DLMP integrated P2P2G energy trading in distribution-level grid-interactive transactive energy systems

The rapid growth in installing small-scale renewable energy resources with storage units and flexible loads in distribution networks has led to a paradigm shift in the modern power system wherein the traditional electricity consumers become energy-sharing-capable prosumers (producer+consumer). In the given context, designing new energy management platforms facilitating the local energy market environments are inevitable to efficiently manage the prosumers through proper incentive mechanism while securely managing the distribution networks. In such systems, it is imperative to make simultaneous coordination between the prosumers themselves and the distribution system operators, but it is exceptionally challenging. This paper, therefore, presents a coordinated and fully distributed two-level peer-to-peer-to-grid transactive energy management framework that allows the grid-interactive prosumers to participate in local electricity markets with iterative distributed energy pricing. In the upper level, we designed a network-constrained cost minimization problem integrated with distribution locational marginal price (DLMP) in a residential power distribution network and solved it in a distributed fashion using the Alternating Direction Method of Multipliers (ADMM) algorithm. In the lower level, a non-cooperative peer-to-peer energy pricing game is formulated at the Rosen–Nash equilibrium point and solved by Nikaido–Isoda relaxation and ADMM algorithms. We justified the proposed scheme’s effectiveness through software simulations by applying it in an IEEE 15-bus distribution system. The results show that the proposed approach reaches convergence within several iterations and a reasonable computation time. Moreover, the developed framework certainly can enhance the economic benefits of the prosumers compared to the traditional peer-to-grid approaches.