On the computation of Nash bargaining solution with an energy management example

Computational methods for Nash bargaining problems are presented. The Nash bargaining problem is dealt with in a Hilbert space setting as a constrained optimization problem. The feasible direction method is applied to find its solution. It is also shown that the Nash bargaining problem can be solved as a hierarchical decision problem, where at the top level of the hierarchy a fixed point search algorithm is used to obtain the bargaining solution. This approach is demonstrated by a computation of a cooperative energy management policy for N power plants.