Community storage for firming

We analyze the benefit of storage capacity sharing for a set of consumers in a community (e.g., an apartment building or an industrial park). Each consumer has its own choice of either installing its own storage system or investing in a shared storage system. More precisely, they will decide on the capacity of the storage system to minimize the installation cost subject to a chance constraint for firming (e.g., to limit the exposure risk to the real time market). If the consumers decide to operate a shared storage system, they must also decide on a scheme to allocate the costs. We formulate the problem as a cooperative game and identify an efficient and stable cost allocation rule. In settings where certain statistical information is private, the cooperative storage sharing game becomes embedded with a non-cooperative information reporting game. We show our proposed cost allocation rule induces all consumers to report their private information truthfully.