IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v241y2019icp625-639.html
   My bibliography  Save this article

Integration of energy markets in microgrids: A double-sided auction with device-oriented bidding strategies

Author

Listed:
  • El-Baz, Wessam
  • Tzscheutschler, Peter
  • Wagner, Ulrich

Abstract

Energy trading markets are one of the most viable solutions to incentivize prosumers in Microgrids. They offer the utility a versatile access for flexible loads coordination without violating the consumer privacy. In the literature, several models and designs were presented to address different aspects of energy trading markets, yet there is a gap between these models and their application in real-life. This paper describes a novel discrete-timely double-sided auction model that facilitates energy trading between prosumers in near real-time and forward markets. Since the practical realization of the model represents a crucial criterion for this model, the market is designed with fast clearing mechanism and simple bidding rules that guarantee the benefits of the prosumers, their privacy, and consider their personal preferences. Additionally, a decentralized home energy management approach is followed at the prosumer level to maximize the system reliability and enable an easy integration of multiple devices from different manufacturers. Hence, a device-oriented bidding strategy is demonstrated that considers the physical characteristics and technical limitations of each device type such as electric vehicles (EV), micro-combined heat and power systems (micro-CHP) or heat pumps. Furthermore, an open-source day-ahead probabilistic forecast for the photovoltaic systems (PV) is integrated with a bidding scheme that maximizes the prosumers commitment in the forward market. In the results, field measurements and testbeds data are used to quantify the benefits of the market model to the utility and the prosumers based on different metrics such as self-sufficiency, self-consumption, peak load and CO2 emission reduction, and total costs. The results indicate that the market model can increase self-sufficiency and self-consumption of a microgrid while reducing the prosumer costs on average by 23%.

Suggested Citation

  • El-Baz, Wessam & Tzscheutschler, Peter & Wagner, Ulrich, 2019. "Integration of energy markets in microgrids: A double-sided auction with device-oriented bidding strategies," Applied Energy, Elsevier, vol. 241(C), pages 625-639.
    • Handle: RePEc:eee:appene:v:241:y:2019:i:c:p:625-639
    DOI: 10.1016/j.apenergy.2019.02.049
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261919303460
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2019.02.049?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. D. G. Devine & B. W. Marion, 1980. "The Influence of Consumer Price Information on Retail Pricing and Consumer Behavior: Reply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(2), pages 267-269.
    2. Bahrami, Shahab & Amini, M. Hadi, 2018. "A decentralized trading algorithm for an electricity market with generation uncertainty," Applied Energy, Elsevier, vol. 218(C), pages 520-532.
    3. Guo, Yabin & Wang, Jiangyu & Chen, Huanxin & Li, Guannan & Liu, Jiangyan & Xu, Chengliang & Huang, Ronggeng & Huang, Yao, 2018. "Machine learning-based thermal response time ahead energy demand prediction for building heating systems," Applied Energy, Elsevier, vol. 221(C), pages 16-27.
    4. Killian, M. & Zauner, M. & Kozek, M., 2018. "Comprehensive smart home energy management system using mixed-integer quadratic-programming," Applied Energy, Elsevier, vol. 222(C), pages 662-672.
    5. Zhang, Chenghua & Wu, Jianzhong & Zhou, Yue & Cheng, Meng & Long, Chao, 2018. "Peer-to-Peer energy trading in a Microgrid," Applied Energy, Elsevier, vol. 220(C), pages 1-12.
    6. Mengelkamp, Esther & Gärttner, Johannes & Rock, Kerstin & Kessler, Scott & Orsini, Lawrence & Weinhardt, Christof, 2018. "Designing microgrid energy markets," Applied Energy, Elsevier, vol. 210(C), pages 870-880.
    7. Aghajani, G.R. & Shayanfar, H.A. & Shayeghi, H., 2017. "Demand side management in a smart micro-grid in the presence of renewable generation and demand response," Energy, Elsevier, vol. 126(C), pages 622-637.
    8. Zhou, Yue & Wu, Jianzhong & Long, Chao, 2018. "Evaluation of peer-to-peer energy sharing mechanisms based on a multiagent simulation framework," Applied Energy, Elsevier, vol. 222(C), pages 993-1022.
    9. Long, Chao & Wu, Jianzhong & Zhou, Yue & Jenkins, Nick, 2018. "Peer-to-peer energy sharing through a two-stage aggregated battery control in a community Microgrid," Applied Energy, Elsevier, vol. 226(C), pages 261-276.
    10. Cason, Timothy N. & Friedman, Daniel, 1996. "Price formation in double auction markets," Journal of Economic Dynamics and Control, Elsevier, vol. 20(8), pages 1307-1337, August.
    11. Wu, Zhou & Tazvinga, Henerica & Xia, Xiaohua, 2015. "Demand side management of photovoltaic-battery hybrid system," Applied Energy, Elsevier, vol. 148(C), pages 294-304.
    12. Ben Ali, I. & Turki, M. & Belhadj, J. & Roboam, X., 2018. "Optimized fuzzy rule-based energy management for a battery-less PV/wind-BWRO desalination system," Energy, Elsevier, vol. 159(C), pages 216-228.
    13. Gottwalt, Sebastian & Ketter, Wolfgang & Block, Carsten & Collins, John & Weinhardt, Christof, 2011. "Demand side management—A simulation of household behavior under variable prices," Energy Policy, Elsevier, vol. 39(12), pages 8163-8174.
    14. Jiang, Bo & Muzhikyan, Aramazd & Farid, Amro M. & Youcef-Toumi, Kamal, 2017. "Demand side management in power grid enterprise control: A comparison of industrial & social welfare approaches," Applied Energy, Elsevier, vol. 187(C), pages 833-846.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Neves, Diana & Scott, Ian & Silva, Carlos A., 2020. "Peer-to-peer energy trading potential: An assessment for the residential sector under different technology and tariff availabilities," Energy, Elsevier, vol. 205(C).
    2. Tushar, Wayes & Saha, Tapan Kumar & Yuen, Chau & Azim, M. Imran & Morstyn, Thomas & Poor, H. Vincent & Niyato, Dustin & Bean, Richard, 2020. "A coalition formation game framework for peer-to-peer energy trading," Applied Energy, Elsevier, vol. 261(C).
    3. Elkazaz, Mahmoud & Sumner, Mark & Thomas, David, 2021. "A hierarchical and decentralized energy management system for peer-to-peer energy trading," Applied Energy, Elsevier, vol. 291(C).
    4. Lissy Langer, 2020. "An Optimal Peer-to-Peer Market Considering Modulating Heat Pumps and Photovoltaic Systems under the German Levy Regime," Energies, MDPI, vol. 13(20), pages 1-25, October.
    5. Chen, Xi & Liu, Boxuan & Qiu, Jing & Shen, Wei & Reedman, Luke & Dong, Zhao Yang, 2021. "A new trading mechanism for prosumers based on flexible reliability preferences in active distribution network," Applied Energy, Elsevier, vol. 283(C).
    6. Bidan Zhang & Yang Du & Xiaoyang Chen & Eng Gee Lim & Lin Jiang & Ke Yan, 2022. "Potential Benefits for Residential Building with Photovoltaic Battery System Participation in Peer-to-Peer Energy Trading," Energies, MDPI, vol. 15(11), pages 1-21, May.
    7. Palacios-Garcia, Emilio J. & Carpent, Xavier & Bos, Joppe W. & Deconinck, Geert, 2022. "Efficient privacy-preserving aggregation for demand side management of residential loads," Applied Energy, Elsevier, vol. 328(C).
    8. Mario Tovar & Miguel Robles & Felipe Rashid, 2020. "PV Power Prediction, Using CNN-LSTM Hybrid Neural Network Model. Case of Study: Temixco-Morelos, México," Energies, MDPI, vol. 13(24), pages 1-15, December.
    9. Lee, Minwoo & Han, Changho & Kwon, Soonbum & Kim, Yongchan, 2023. "Energy and cost savings through heat trading between two massive prosumers using solar and ground energy systems connected to district heating networks," Energy, Elsevier, vol. 284(C).
    10. Schwidtal, J.M. & Piccini, P. & Troncia, M. & Chitchyan, R. & Montakhabi, M. & Francis, C. & Gorbatcheva, A. & Capper, T. & Mustafa, M.A. & Andoni, M. & Robu, V. & Bahloul, M. & Scott, I.J. & Mbavarir, 2023. "Emerging business models in local energy markets: A systematic review of peer-to-peer, community self-consumption, and transactive energy models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 179(C).
    11. Sebastian Schreck & Robin Sudhoff & Sebastian Thiem & Stefan Niessen, 2022. "On the Importance of Grid Tariff Designs in Local Energy Markets," Energies, MDPI, vol. 15(17), pages 1-25, August.
    12. Jafari, Amirreza & Ganjeh Ganjehlou, Hamed & Khalili, Tohid & Bidram, Ali, 2020. "A fair electricity market strategy for energy management and reliability enhancement of islanded multi-microgrids," Applied Energy, Elsevier, vol. 270(C).
    13. Rodrigues, Stefane Dias & Garcia, Vinicius Jacques, 2023. "Transactive energy in microgrid communities: A systematic review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 171(C).
    14. Capper, Timothy & Gorbatcheva, Anna & Mustafa, Mustafa A. & Bahloul, Mohamed & Schwidtal, Jan Marc & Chitchyan, Ruzanna & Andoni, Merlinda & Robu, Valentin & Montakhabi, Mehdi & Scott, Ian J. & Franci, 2022. "Peer-to-peer, community self-consumption, and transactive energy: A systematic literature review of local energy market models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 162(C).
    15. Rezaei, Navid & Pezhmani, Yasin & Khazali, Amirhossein, 2022. "Economic-environmental risk-averse optimal heat and power energy management of a grid-connected multi microgrid system considering demand response and bidding strategy," Energy, Elsevier, vol. 240(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Esmat, Ayman & de Vos, Martijn & Ghiassi-Farrokhfal, Yashar & Palensky, Peter & Epema, Dick, 2021. "A novel decentralized platform for peer-to-peer energy trading market with blockchain technology," Applied Energy, Elsevier, vol. 282(PA).
    2. Capper, Timothy & Gorbatcheva, Anna & Mustafa, Mustafa A. & Bahloul, Mohamed & Schwidtal, Jan Marc & Chitchyan, Ruzanna & Andoni, Merlinda & Robu, Valentin & Montakhabi, Mehdi & Scott, Ian J. & Franci, 2022. "Peer-to-peer, community self-consumption, and transactive energy: A systematic literature review of local energy market models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 162(C).
    3. Siripha Junlakarn & Phimsupha Kokchang & Kulyos Audomvongseree, 2022. "Drivers and Challenges of Peer-to-Peer Energy Trading Development in Thailand," Energies, MDPI, vol. 15(3), pages 1-25, February.
    4. Rodrigues, Daniel L. & Ye, Xianming & Xia, Xiaohua & Zhu, Bing, 2020. "Battery energy storage sizing optimisation for different ownership structures in a peer-to-peer energy sharing community," Applied Energy, Elsevier, vol. 262(C).
    5. Zhou, Yue & Wu, Jianzhong & Song, Guanyu & Long, Chao, 2020. "Framework design and optimal bidding strategy for ancillary service provision from a peer-to-peer energy trading community," Applied Energy, Elsevier, vol. 278(C).
    6. Lüth, Alexandra & Zepter, Jan Martin & Crespo del Granado, Pedro & Egging, Ruud, 2018. "Local electricity market designs for peer-to-peer trading: The role of battery flexibility," Applied Energy, Elsevier, vol. 229(C), pages 1233-1243.
    7. Meena, Nand K. & Yang, Jin & Zacharis, Evan, 2019. "Optimisation framework for the design and operation of open-market urban and remote community microgrids," Applied Energy, Elsevier, vol. 252(C), pages 1-1.
    8. Schwidtal, J.M. & Piccini, P. & Troncia, M. & Chitchyan, R. & Montakhabi, M. & Francis, C. & Gorbatcheva, A. & Capper, T. & Mustafa, M.A. & Andoni, M. & Robu, V. & Bahloul, M. & Scott, I.J. & Mbavarir, 2023. "Emerging business models in local energy markets: A systematic review of peer-to-peer, community self-consumption, and transactive energy models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 179(C).
    9. Zheng, Boshen & Wei, Wei & Chen, Yue & Wu, Qiuwei & Mei, Shengwei, 2022. "A peer-to-peer energy trading market embedded with residential shared energy storage units," Applied Energy, Elsevier, vol. 308(C).
    10. Jin, Xiaolong & Wu, Qiuwei & Jia, Hongjie, 2020. "Local flexibility markets: Literature review on concepts, models and clearing methods," Applied Energy, Elsevier, vol. 261(C).
    11. Azim, M. Imran & Tushar, Wayes & Saha, Tapan K., 2021. "Cooperative negawatt P2P energy trading for low-voltage distribution networks," Applied Energy, Elsevier, vol. 299(C).
    12. Kirchhoff, Hannes & Strunz, Kai, 2019. "Key drivers for successful development of peer-to-peer microgrids for swarm electrification," Applied Energy, Elsevier, vol. 244(C), pages 46-62.
    13. Lyu, Cheng & Jia, Youwei & Xu, Zhao, 2021. "Fully decentralized peer-to-peer energy sharing framework for smart buildings with local battery system and aggregated electric vehicles," Applied Energy, Elsevier, vol. 299(C).
    14. Wang, Zibo & Yu, Xiaodan & Mu, Yunfei & Jia, Hongjie, 2020. "A distributed Peer-to-Peer energy transaction method for diversified prosumers in Urban Community Microgrid System," Applied Energy, Elsevier, vol. 260(C).
    15. Hu, Qian & Zhu, Ziqing & Bu, Siqi & Wing Chan, Ka & Li, Fangxing, 2021. "A multi-market nanogrid P2P energy and ancillary service trading paradigm: Mechanisms and implementations," Applied Energy, Elsevier, vol. 293(C).
    16. Davarzani, Sima & Pisica, Ioana & Taylor, Gareth A. & Munisami, Kevin J., 2021. "Residential Demand Response Strategies and Applications in Active Distribution Network Management," Renewable and Sustainable Energy Reviews, Elsevier, vol. 138(C).
    17. Yuki Matsuda & Yuto Yamazaki & Hiromu Oki & Yasuhiro Takeda & Daishi Sagawa & Kenji Tanaka, 2021. "Demonstration of Blockchain Based Peer to Peer Energy Trading System with Real-Life Used PHEV and HEMS Charge Control," Energies, MDPI, vol. 14(22), pages 1-12, November.
    18. Tushar, Wayes & Saha, Tapan Kumar & Yuen, Chau & Azim, M. Imran & Morstyn, Thomas & Poor, H. Vincent & Niyato, Dustin & Bean, Richard, 2020. "A coalition formation game framework for peer-to-peer energy trading," Applied Energy, Elsevier, vol. 261(C).
    19. Soto, Esteban A. & Bosman, Lisa B. & Wollega, Ebisa & Leon-Salas, Walter D., 2021. "Peer-to-peer energy trading: A review of the literature," Applied Energy, Elsevier, vol. 283(C).
    20. de la Hoz, Jordi & Martín, Helena & Alonso, Alex & Carolina Luna, Adriana & Matas, José & Vasquez, Juan C. & Guerrero, Josep M., 2019. "Regulatory-framework-embedded energy management system for microgrids: The case study of the Spanish self-consumption scheme," Applied Energy, Elsevier, vol. 251(C), pages 1-1.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:241:y:2019:i:c:p:625-639. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.