Negotiation strategy based on game theory with agent for bilateral bargaining of power market

Under the environment of wholesale competition power markets in the future in China, the bilateral bargaining strategy of long-term 'direct supply' contract between consumer and generation company is studied. Considering the expectant profit of bargaining, the mixed strategy for bidding in multi-player bargaining is proposed. The game theory and its Nash equilibrium in the mixed strategy are analyzed in detail. The analytic hierarchical process (AHP) is applied to synthetically evaluate potential bargainers and obtain the selected probability of mixed strategy so as to find the appropriate bargainers, reduce the cost of long-term contract negotiation, and finally sign the contact successfully. The idea of multi-agent system (MAS) is used to simulate the circulatory negotiation process of multi-player participates and the validity of the method is demonstrated by a numerical example with multi-player participates.