Sean Meyn
Department of Electrical and Computer Engineering
Coordinated Science Laboratory
University of Illinois at Urbana-Champaign
Optimization and the Price of Anarchy in a Dynamic Newsboy Model
This seminar concerns resource allocation, pricing, and performance evaluation in electric power markets. The ultimate goal is the integration of new approaches to dynamic control of stochastic networks, with recent results concerning the competitive market equilibrium in network industries, to obtain comprehensive approaches to model reduction and control for network-level bulk power systems.
Described are some modest first steps: a dynamic flow model constructed for a single-consumer model in analogy with a standard stochastic queuing model; the approximation of the socially-optimal policy by an explicit threshold policy; and the inability to sustain the socially-optimal policy as a decentralized market outcome. Generalizations to complex models are also described.
These conclusions have implication to other industries that require high reliability and provide critical services which are undergoing rapid deregulation.