Abstract: Discusses the pricing problem on power market. The concept of incentive Stackelberg strategy was introduced into the model of a simplified power market system that comprises subsidiary systems of users and power system networks. The utility maximization of users is considered to determine dynamically the new power price on a rationally developing power market. The algorithm taking account of incentive strategy is more reasonable than that just splitting the bill as in the past. A linear strategy and two nonlinear strategies were proposed to the power pricing problem according to both the output capacity of Power Company and demand of users. Some numerical simulations were carried out for the linear strategy and two nonlinear strategies via MATLAB, thus illustrating the effectiveness and practicability of the proposed algorithm.