Deep Reinforcement Learning-Based Explainable Pricing Policy for Virtual Storage Rental Service

Xiangyu Li, Hangyue Liu, Chaojie Li, Guo Chen*, Cuo Zhang, Zhao Yang Dong

*Corresponding author for this work

Research output: Journal Publications and ReviewsRGC 21 - Publication in refereed journalpeer-review

23 Citations (Scopus)

Abstract

The shared community energy storage system (CESS) can reduce energy storage costs by exploiting the complementarity of end-users and economies of scale. To further improve the economic feasibility of the CESS, we propose a novel business model and pricing method for the virtual storage rental service (VSRS). In this model, the rental users aim to minimize the electricity bill by renting the virtual capacity and optimizing its operation, while the CESS operator seeks to maximize the revenue from the combination of energy arbitrage and the VSRS. The pricing problem and the optimal operation problems of the CESS and users' virtual batteries are modeled as a bi-level optimization problem. Next, the proposed problem is solved through transformer-based deep deterministic policy gradient (TDDPG) method and mixed-integer linear programming (MILP) due to the non-convexity and non-continuity of the original problem. The post-hoc interpretability of the policy network is provided based on the Shapley value to reveal the importance of different input features for decision-making. Numerical simulations suggest that the proposed VSRS could benefit the CESS operator and users. Moreover, the explanation based on the Shapley value could effectively generate an implicit solution for understanding the policy network. © 2023 IEEE.
Original languageEnglish
Pages (from-to)4373-4384
JournalIEEE Transactions on Smart Grid
Volume14
Issue number6
Online published13 Mar 2023
DOIs
Publication statusPublished - Nov 2023
Externally publishedYes

Research Keywords

  • deep reinforcement learning
  • explainable pricing policy
  • Shared community energy storage
  • virtual storage service

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