Mechanism design for data sharing: An electricity retail perspective

• Data products can reduce uncertainty in decision-making problems with uncertainty. • Data revenues and costs are defined by uncertainty reduction and privacy exposure. • Electricity-side and data-side transactions are linked with data sharing framework. • The profit allocation mechanism ensures the profitability of electricity retailer. Information incompletion always forces market participants to make decisions under uncertainty in energy transactions, while obtaining related data is a feasible way for them to reduce uncertainty and gain profits. However, the application of data transactions is not yet mature. To extend the application range of data transactions and concretize the data transaction model, a novel framework of electricity-side and data-side transactions linked with data sharing is proposed from the electricity retail perspective in this paper. The necessity and processes of data sharing between the electricity retailer and data suppliers are elaborately illustrated in the framework. Data revenues and data costs are analyzed according to uncertainty reduction and information provision. Considering the widely used two-settlement system of electricity markets, data revenues and data costs can be expressed in closed forms and their differences are net profits that are regarded to drive the data flow. Furthermore, an ex-post profit allocation mechanism is matched to appropriately allocate the net profits between the electricity retailer and data suppliers in the data sharing model. By comparison with the Shapley value method, the mechanism is less time-consuming and will ensure the profitability of the electricity retailer. Finally, a practical case with real data is employed to realize the results proposed in the theoretical analysis, and the feasibility of the data sharing model and profit allocation mechanism is validated.