This paper presents a stochastic dynamic cooperative game model of power exchange between interconnected utilities. The model is used for the qualitative analysis of an efficient management of the interconnected networks. It also permits an analysis of the different pricing schemes through which the utilities effectuate the side-payments associated with the bargaining solutions. The case of two utilities is approached via the Nash-Harsanyi bargaining solution. Different approaches concerning the design of acceptable pricing schemes are proposed and discussed.
Published October 1990 , 13 pages