To alleviate congestions of grids is one of the most important managerial performance indicators in the electricity market. The role of retail electricity providers (REPs) can be effective in alleviating such congestions. However, little effort has been devoted for involving REPs collaboratively in congestion alleviation. This paper addresses this shortfall in the literature. It proposes an innovative solution for the congestion problem through reinforcing a collaboration between the ISO and REPs in implementing demand response (DR) programs. The idea of economic signaling, conveyed by the ISO to REPs, is employed to assist REPs in trading with demand response aggregators. Stackelberg game theory is adopted for designing such trade in the market. The effectiveness of the proposed method is evaluated using a test power system. The paper demonstrates an effective performance for the proposed method. By providing a novel game theory solution for the congestion problem based on involving REPs in the DR program, a contribution is made to the current practice of grid congestion management. The paper outcomes will be of particular interest when the grid faces the highest possible demand particularly during the hot season.
