In this work, we build an optimization scheme to manage the electrical consumption of a variaty of appliances within smart homes. Examples of these appliances are air-conditioners, fridges, and water heaters. The aim is to reduce the electrical bill incured by the houshold while maintaing the desired comfort level set by the user.

As the name suggests, microgrids are small-scale grids that generally contain loads and generation resources with the ability to connect and disconnected from the main grid. Here, we propose an optimization framework that enables microgrid owners to optimize their operation while also providing different ancillary services to the main grid (a win-win approach).

When multiple microgrids are connecting within a distribution system, it becomes desirable to optimize them collectively. However, each microgrid is typically operated by a different entity (the owner). Therefore, in this work, we utilize distributed optimization techniques to achieve global goals for the distribution system while maintaining the independent operation of each microgrid.