  In this paper, we propose a market design based on game theory to optimally
utilize the flexibility of distributed energy resources (DERs) such as solar
PV, batteries, electric vehicles, and flexible loads. Market agents perform
multiperiod optimization to determine their feasible flexibility limits for
power injections while satisfying all constraints of their DERs. This is
followed by a Stackelberg game between the market operator and the agents. The
market operator as the leader aims to regulate the aggregate power injection
around a desired value by leveraging the flexibility of their agents, and
computes optimal prices for both electricity and flexibility services. The
agents follow by optimally bidding their desired flexible power injections in
response to these prices. We show the existence of an equilibrium among the
market agents between all agents and the operator, along with simulation
results for a small example system.
