With the launch of a new round of electricity market reform in China

a large number of electricity retailers have been set up. As a new participant in electricity market

electricity procurement and sale strategies have become core issues for electricity retailers. In view of the increasing demand response ability

a bi-level model of electricity procurement and sale strategies for electricity retailers is proposed by taking user demand response into account. The upper-level model takes maximum retailers' profit as its objective

while the lower-level model takes maximum users' utility as its objective. Besides

the penalty mechanism of the bilateral contract is considered and the user's electricity utilization response behavior is modeled. Moreover

the mechanism of electricity retailers representative users' demand response resources is adopted to interact with the real-time market. Finally

this model is verified with PJM market's data. Results show that the proposed model can provide an optimal electricity procurement and sale strategy to both electricity retailers and the users.