Stackelberg Game-Based Scheduling Strategy for River Basin Virtual Power Plants with Compensation Contracts

In remote regions with abundant hydropower resources, upstream and downstream river basin virtual power plants (RBVPPs) operated by different entities are hydraulically coupled. Independent scheduling may therefore lead to inefficient water allocation and profit losses because downstream inflow depends on upstream reservoir releases. This study proposes a multi-RBVPP scheduling strategy based on a bidirectional water compensation contract. The independent-operation outflow schedule serves as the contractual baseline, and both increases and decreases in upstream releases are compensated according to their time-dependent effects on the downstream inflow. These effects are quantified using matrices for hydraulic connectivity, flow distribution coefficients, and water travel time. In the Stackelberg framework, the downstream RBVPP determines the time-varying compensation prices and electricity sales plan, whereas the upstream RBVPP adjusts reservoir releases and generation schedules subject to its own operational constraints. Only boundary outflow information is exchanged, preserving the privacy of internal operations. Conditional value-at-risk (CVaR) and scenario-based stochastic optimization are used to address uncertainties in renewable generation and hydrological conditions. The results for wet, normal, and dry conditions show that the proposed framework increases the profits of both RBVPPs and improves the coordinated use of basin water resources.