# Towards a Consumer-Centric Grid: A Behavioral Perspective

arXiv: https://arxiv.org/abs/1511.01065 · HTML: https://mlsanity.com/paper/1511.01065/

## Key facts

- Cited by 1 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 1 Nov 2015.

## Built on by (most cited first, 1 of 1)

- [Prospect Theory-inspired Automated P2P Energy Trading with Q-learning-based Dynamic Pricing](https://mlsanity.com/paper/2208.12777/) (2022)

## Abstract (arXiv)

Active consumer participation is seen as an integral part of the emerging smart grid. Examples include demand-side management programs, incorporation of consumer-owned energy storage or renewable energy units, and active energy trading. However, despite the foreseen technological benefits of such consumer-centric grid features, to date, their widespread adoption in practice remains modest. To shed light on this challenge, this paper explores the potential of prospect theory, a Nobel-prize winning theory, as a decision-making framework that can help understand how risk and uncertainty can impact the decisions of smart grid consumers. After introducing the basic notions of prospect theory, several examples drawn from a number of smart grid applications are developed. These results show that a better understanding of the role of human decision-making within the smart grid is paramount for optimizing its operation and expediting the deployment of its various technologies.