Toward Future Information Market: An Information Valuation Paradigm

With the development of internet technology, information has become an increasingly important asset for the operation and planning of power systems. However, the existing research and practice pay less attention on information value evaluation, i.e., the potential for information to be converted into actual economic benefits. To this end, this paper studies a holistic and general information valuation model. First, an information market framework is formulated to clarify the contributions of information vendors and customers. A qualitybased information valuation paradigm is developed, in which such quality is measured from two dimensions, i.e., Shannonentropy and non-noise ratio, considering both quantity and accuracy of the information. Based on the proposed information utility function, we investigate the potential application in smart grids. Here we show the valuation of photovoltaic power forecasting-related information in a unit commitment problem. Case studies based on the IEEE 30-bus system validate the effectiveness of the proposed paradigm and method.