Cyber-Physical Decentralized Planning for Communizing

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* Article: Cyber-physical decentralized planning for communizing. By Pedro HJ Nardelli, Pedro E Gória Silva, et al. Competition & Change. Special Issue: Rethinking Economic Planning




"This paper proposes a decentralized planning constructed as a cyber-physical system to jointly manage supply and demand, including aspects related to production and circulation, without the mediation of money. Our aim is to provide a concrete technical solution for a future society based on communizing and commons-based resource allocation as an attempt to move in-against-and-beyond the value-form, which is the social “force-field” that characterizes the capitalist mode of production.

This contribution is divided into three articulated parts:

(i) a review of the elementary forms that jointly determine the capitalist social organization,

(ii) a defense of the proposition that the money-form must be destroyed to enable a new mode of production based on communizing, and

(iii) a proposal of a cyber-physical implementation of a jointly decentralized production planning and resource allocation over large infrastructures that enable a multilevel polycentric governance as a variation of the Interactive Economic Planning and Optimized Selections (I-EPOS) algorithm when coordination is needed."


"This article defends the acts of communizing as the basis of a new mode of production, where social coordination is enabled by some of the recent advances in information and communication technologies (ICTs), in many ways aligned with (Groos, 2021; Bernes, 2020; Sutterlütti and Meretz, 2023). Our focus will be on a specific decentralized planning method called Interactive Economic Planning and Optimized Selections (I-EPOS) developed by Pournaras et al. (2018); Pournaras (2020). ...

The rest of this paper is organized as follows.

  • We first present the elementary social forms of capitalism as a purified scientific (ideal) object defined by a totalizing social force-field determined by the value-form, from where intrinsic vulnerabilities shall be found.
  • Then, we present a new conceptualization of cyber-physical systems introduced by Nardelli (2022) that is helpful to both reject solutions that resemble capitalist forms and support the communizing-based political economy.
  • As a step further, we present our vision of a fully demonetized future based on decentralized planning following polycentric governance for communizing, similar to the decentralized solution for energy systems first presented by Giotitsas et al. (2022); Nardelli et al. (2021)."


Value-form as a social force-field

"Since his own time, Karl Marx’s writings have been a fertile ground for heated debates, both between persons or groups identified as Marxist against non-Marxist and among Marxists themselves. In this section, we follow the approach taken by scholars like Elbe (2013), who classify different Marxisms. Until the seventies, there were two principal readings: Orthodox Marxism, supported by the Soviet Union, and Western Marxism, associated with young Marx. The first one is usually associated with “economicism” and the second with “humanism.” Although these strains are still relevant within different groups both in academic circles and communist parties, a New Reading of Marx dealing with rigid patterns of social relation, or simply social forms, emerged in Germany motivated by then-forgotten Soviet writers from 1920s; they are Evgeny Pashukanis and Isaak Rubin, both victims of the purges during the late 1930s. Roughly speaking, the key to understanding Capital is the recurrent (almost naturalized) forms of social relations like the market exchange of equivalents mediated by money and wage labor. The Value-form Theory, associated with the first chapters of Capital, becomes the cornerstone of this approach, which is pedagogically exposed by Heinrich (2021).

A specific line of research affiliated with this reinterpretation of Marx is the State derivation debate, where the State and the Legal Subject are also derived from the commodity-form. The logical formulation follows a chain where the elementary form of wealth in the capitalist mode of production—the commodity—is the basis to derive other necessary forms that constitute the capitalist mode of production as such. It is worth highlighting that the capitalist mode of production, as indicated here, is a purified scientific object, which is constituted historically, and, thus, is not eternal. The specific difference between capitalism, on the one side, and the other past and possibly future ways to organize societies and social practices, on the other side, can be then explicitly characterized through social forms.

Holloway (2022) schematically presents the derivation of the capitalist social forms (or the form-determination chain), constituting then the links in the chain of destruction [that] are difficult to break. The derivation sequence, as presented in Chapter 19, goes as follows: (a) if commodity, then value; (b) if commodity-value, then labor; (c) if commodity–value–labour, then money; (d) if commodity–value–labour–money, then identity; (e) if money, then capital and exploitation; (f) if capital, then state; and finally (f) if commodity–value–labour–money–identity–capital–state, then destruction of nature–pandemics–global warming–extinction. In this sense, the logical core of capitalist sociality is constituted with money being the universal social binding, or as the title of Chapter 28 puts Money rules. Money is the serial killer destroying us all.

Holloway’s argument is constructed based on the hope-against the capitalist forms that restrain the overflowing of social practices (or doing, or concrete-labor, or productive human activity), which are always more than the logically imposed constraints byproduct of the social form. By focusing on the immanent antagonisms and on the fact, shown in detail by Paraná (2018), that capital is mostly fictitious (credit money), with a huge gap of what can be actually materially produced, hope can emerge. In summary, the negative of capitalist forms, especially the demonetization of the social relations, is the hope-against capitalism, the concrete utopia against wishful thinking; the struggle is then to be located at social forms and their immanent overflowing, not in the logical links that indicate the chain of destruction."

Cyber-physical system design for the distributed energy resource allocation

"One example that follows this cyber-physical system design is the distributed energy resource allocation through virtual microgrids, as presented by Nardelli et al. (2021); Giotitsas et al. (2022). The socio-technical proposal in those articles is to communize an electrified energy system, indicating ways to both repair existing hardware and operate the grid considering the necessary balance of supply and demand of electricity (also including storage and flexible loads). In more concrete terms, Mashlakov et al. (2021) develop a simulation-based example of how peer-produced energy could be communized and distributed across different users using the I-EPOS algorithm at the decision layer based on the information obtained from physical attributes at the data layer, while evaluating the impacts on the physical layer. Although those works are not boldly claiming for a new mode of production based on communizing, they provide a clear illustration of the ambivalence of ICTs to govern large-scale shared infrastructures like this electrified energy system as a commons that will be presented in more detail later. Note that the term “ambivalence” here is borrowed from Feenberg (1990) who argues that technologies, despite being produced in favor of capitalist existing relations, also offer a place for struggle. Following our argument, some ICTs could be appropriated as a tool in-against-and-beyond the value-form, and this is so because it is ambivalent."

The I-EPOS as a General-Purpose Decentralized Collective Learning Algorithm

Pedro HJ Nardelli, Pedro E Gória Silva, et al. :

"The I-EPOS algorithm and how it is capable of allocate resources in the previously described vision of the communist mode of production, capable of enabling a polycentric commons-based governance system.. I-EPOS was proposed by Pournaras et al. (2018) as a general-purpose decentralized collective learning algorithm. In I-EPOS, distributed elements called agents in a network self-determine a set of viable options for themselves, for example, resource consumption and production schedules. Each of these options, or “plans,” has an associated “local” numerical quantification referred to as cost following the literature in the field that represents the agent’s preference for that plan. Moreover, these plans collectively have a system-wide impact that is modeled in terms of a “global cost.” Note that cost here is a mathematical function that might represent money (as monetary expenses or profits), but they can also represent other parameters of interest as well, for example, fairness, environmental impacts, emissions, and deviation from desired states. These latter ones are what interest us most. The I-EPOS algorithm is capable of optimizing the global cost alone, implying full cooperation and thereby selflessness; the local costs alone, implying no coordination and thereby selfishness; or their mixture, implying a tradeoff between selflessness and selfishness.

A rigorous mathematical analysis of I-EPOS can be found in articles by Pournaras et al. (2018); Pournaras (2020); here, we only give a brief non-technical explanation. Consider a network of distributed agents; all the agents have a finite set of feasible plans that represent the resource allocation. For example, consider a network of machines in a modern manufacturing industry that can communicate with each other via an Internet of Things network. These machines have to perform certain processes to manufacture a product, and they can do this independently or by coordinating with each other. For such a machine, a plan could be “2.145: 1.339,2.132,1.534,3.685,1.876,4.81,” where 2.145 represents the local cost, that is, the energy consumed by the machine over a 6-h process schedule (given by the energy consumed per hour, kWh). The machine proposes several such plans, each with different preferences (or costs). Every such machine, or agent, is connected to each other in the network, and all of them have their own plans corresponding to their individual schedules and energy consumption. I-EPOS determines an aggregated response by summing up (element-wise) the selected plans and their costs. Thus, the selected plans of all the agents form a global response vector with an associated global cost. The overall objective is to cooperatively select plans that minimize the global cost. Note that this kind of cooperation is particularly useful when the agents’ choices depend on each other. Moreover, in I-EPOS, agents’ and system’s preferences, that is, local and global costs, can be balanced.

I-EPOS has been shown to work well in scenarios involving collective sharing and usage of resources. For example, consider the case of bike sharing that was studied by Pournaras (2020). Here, users visit a nearby bike station to pick up a bike and then deposit the bike in a station close to their destination. For bike sharing scheme to work well, it should always be possible for the users to pick up a bike in a station and return to another, without the station exceeding the capacity of parked bikes, or having stations without bikes when users need them. By using I-EPOS, Pournaras (2020) showed that I-EPOS can reduce the number of manual bike relocations that are materially needed to avoid the problems mentioned above. In addition, the I-EPOS collective learning algorithm has been shown to obtain near-optimal solutions to other scheduling and resource allocation problems such as load balancing in energy demand-response as in the work by Pournaras et al. (2018), uncertainty-based grid planning and operations by Mashlakov et al. (2021), and tasks involving drone swarms by Qin et al. (2022)."


Decentralized Allocation in Electrified Energy Systems

Pedro HJ Nardelli, Pedro E Gória Silva, et al. :

"The technical specification described by Nardelli et al. (2021) that offers a clear design for a decommoditization of an electrified energy system through its communization. This means that energy production is not subordinated to monetization, and access to energy is open to all. In our view, this would be an intentional path-breaking in the commodification tendency taken in electricity markets, as studied by Apajalahti and Kungl (2022). The communization of the electrified energy system is to be deployed in such a way that it can at the same time (i) weaken the self-reinforcing mechanisms that sustain markets and for-profit energy generation-transmission-distribution and (ii) enable other stronger self-reinforcing mechanisms that are necessarily capable of supplying the energy demand.

It is possible to foresee different paths toward this being implemented, but the communizing structure desired would benefit from organizing the physical grid as networked microgrids. For non-industrial demand, many actions could be taken: retrofit targeting energy conservation in buildings, flexible demand management when needed, use of heat pumps, increase of small-scale renewable sources at the distribution side (closer to the end-user), and integration of storage units. All these should lead to lower overall energy demand. However, for technical reasons, the supply and demand of electricity in the grid must match closely to real-time. To match supply by the intermittent (but in many ways predictable) renewable sources and demand by controlling storage units, heat pumps, and other flexible loads like saunas and dishwashers, a cyber-physical packetized energy management is proposed by De Castro Tomé et al. (2020); Nardelli et al. (2019) and further extended in (Nardelli et al., 2021), from where the technical details can be found. Although these solutions could, in principle, be integrated into the existing market structure (at least many parts of Europe, as illustrated by the idea of energy communities as reviewed by Gjorgievski et al. (2021) or peer-to-peer sharing reported by Klein et al. (2020)), the proposed idea explicitly aims at treating energy as a commons, or in the terms used here communizing energy. The proposed governance approach is mainly highlighted by Giotitsas et al. (2022), as well as by Giotitsas et al. (2015, 2020). The key idea is that open access to energy based on needs without payments and organize the operation of the cyber-physical energy system based towards managing scarcity moments via a rule-based scheme open for community deliberation. Therefore, the planning is decentralized in many senses: community deliberation of operational constraints of how to handle scarcity of supply, multi-agent BitTorrent-type of energy multiplexing through virtual packetization, and the possibility of coordination of individual, regional and global elements towards a shared goal. The iterative stages of bottom-up and top-down of the multi-agent approach of I-EPOS offers one scalable possibility to perform decentralized planning to enable a widespread of communization in-against-and-beyond the value-form.

We present a case that illustrates this approach. In an electricity grid network, for example, every household has its own preferences for the consumption schedules but these preferences have a collective impact on the performance on the grid as a connected network where supply and demand must match in very low time scales for operational reasons. This affects, for example, the electricity that can be shared, the peak load, and the transmission line capacity. I-EPOS can be used to balance those local (individual, agent’s) usage preferences and the overall grid (global) quality requirements by optimizing the tradeoff between the global cost and the local cost. I-EPOS also performs this optimization in an unsupervised and decentralized manner by collectively learning and combining the agents’ plans, while maintaining privacy and autonomy (agents’ schedules do not need to be shared).

In specific terms, let us consider that every household has: (i) solar generation capabilities, (ii) battery as a storage unit, (iii) electric bike with small battery, (iv) electrified thermal loads like heat pumps, heaters, fridges, and freezers, as well as sauna, (v) appliances that can operate flexibly to accomplish their functions like washing dishes and clothes, and (vi) baseload that does not offer flexibility. Following Nardelli et al. (2021), each household can be virtualized as part of a software-defined energy network that determines a cyber-physical system to operate the energy system as a virtual microgrid based on the operational needs of matching energy supply and demand, as well as managing the batteries. This problem can be posed as an inventory management problem not mediated by money. Every agent defines their own priority plans for usage considering the appliances types (iii)-(v); (vi) is given, but predictable. The distributed generation by solar and the battery are managed as a virtual power plant, where the distributed generation and storage units are virtually aggregated to operate the system. We could call every household as an Energy Client in the software-defined energy network, while the I-EPOS would be the algorithm that runs in the Energy Server; batteries and thermal loads are the Energy Buffers. I-EPOS goal is to build up schedules of use based on explicit request and politically-determined prioritization (e.g., what is more important as a load, an electric bike or a heater or a sauna) that are both acceptable by the agents self-determination and operational for the physical grid. This sort of solution already exists in some places, being compatible with the strict electricity market regulations but, most usually, money mediation takes place. Our vision is that this approach can displace the market if it could be scaled up, creating a self-reinforcing mechanism based on commons (virtually aggregate common pool of resources), following paths of the energy transition posed by Apajalahti and Kungl (2022).

The main limitation of this case study is that it focuses on residential and small commercial building demand, and thus, it should be adapted to be employed for large industrial facilities, transportation, and logistics. As a matter of fact, the proposed communization of energy can only be thought of considering as part of the communization process of the mode of production as a whole. Here, we are (in spirit, but not in practice) reminded of Horvat (2020) and the self-managed socialist enterprise and association of associations. The Yugoslav self-management, shaped by the material and geopolitical conditions, is not a monolithic body of theory. Going back to (Todorovic 1965), we see that the intention to do away with the value-form immediately (or any time soon) is referred to as “socialist romanticism” and dismissed from consideration. The acceptance of the value-form and associated market mechanisms by Kardelj and others was challenged continuously. Echoing Bavcar et al. (1985) via (Kirn 2010), the paradoxical position of workers taking the structural position of a capitalist in the production is not an abolition of capital in any meaningful way. The bureaucracy form that is shaped in this relation to manage the economy allows for the value form to keep existing, as (Hamza, 2016) notes, between the state and the party. In brief, we do not believe that the Yugoslav self-management had abolished value form in any way, and we are skeptical of the potential to do so in the direction it took; where we declare ourselves related in spirit is merely the insisting on the distributed approach, but through the roads not taken–some of which Todorovic would have listed in the romanticist treatise.

In this sense, we claim that by organizing the existing large-infrastructures in a similar manner following the guidelines presented by Nardelli (2022) and indicated by the “clinical” question presented in Table 1. Scaling and passing the critical thresholds of communes has been an oft-cited issue with commons; at the same time, degrowth advocates have issues with large power production systems “because an energy-intensive society based on increasingly sophisticated technological systems managed by bureaucrats and technocrats will grow less democratic and egalitarian over time” even in the case of “green megastructures like high-speed trains or industrial-scale wind farms” (Kallis, 2017). In this sense, there are also issues related to raw materials like copper, iron, and other metals needed to produce electronic appliances, solar panels, and batteries as necessary components of the power grid material infrastructure that need necessarily to be solved in a sustainable non-exploitative manner, both socially and environmentally. Those points are of utmost importance, but require studies that go beyond our aim in this section, which is to show that communizing energy is operationally feasible and, in our view, a necessary (but not sufficient) step for the emergence of a mode of production based on commons as a social form, against value."



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