IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v358y2024ics0306261923018913.html
   My bibliography  Save this article

Designing a decentralized peer-to-peer energy market for an active distribution network considering loss and transaction fee allocation, and fairness

Author

Listed:
  • Zare, Amir
  • Mehdinejad, Mehdi
  • Abedi, Mehrdad

Abstract

Transactive energy management (TEM) in smart grids is a promising approach for enhancing the participation of consumers in managing their energies and developing decentralized energy market models using peer-to-peer (P2P) transactions. The present paper designs and models a fully decentralized P2P energy market considering the technical constraints of the physical electricity network to redesign electricity markets as consumer-centric markets. As the sellers and buyers trade energy via the electricity grid, allocating power losses and transaction fees to players in P2P transactions is of utmost significance. The proposed market allows prosumers to engage directly in bilateral energy trading without requiring intermediaries. In addition to local P2P markets, the buyer prosumers can purchase energy from the upstream market and participate in the demand response (DR) program during hours of local generation shortage. A fairness index is applied to evaluate the players’ satisfaction with fairness and participation in the proposed market. Finally, an alternating direction method of multipliers (ADMM) is utilized to clear the proposed decentralized market. Numerical studies are performed on a standard IEEE 13-bus distribution network with multiple prosumers. The simulation results verify the effectiveness and feasibility of the proposed decentralized market and its clearing approach.

Suggested Citation

  • Zare, Amir & Mehdinejad, Mehdi & Abedi, Mehrdad, 2024. "Designing a decentralized peer-to-peer energy market for an active distribution network considering loss and transaction fee allocation, and fairness," Applied Energy, Elsevier, vol. 358(C).
    • Handle: RePEc:eee:appene:v:358:y:2024:i:c:s0306261923018913
    DOI: 10.1016/j.apenergy.2023.122527
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261923018913
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2023.122527?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. Guerrero, Jaysson & Sok, Bunyim & Chapman, Archie C. & Verbič, Gregor, 2021. "Electrical-distance driven peer-to-peer energy trading in a low-voltage network," Applied Energy, Elsevier, vol. 287(C).
    2. Azim, M. Imran & Tushar, Wayes & Saha, Tapan K., 2020. "Investigating the impact of P2P trading on power losses in grid-connected networks with prosumers," Applied Energy, Elsevier, vol. 263(C).
    3. 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.
    4. Alam, Muhammad Raisul & St-Hilaire, Marc & Kunz, Thomas, 2019. "Peer-to-peer energy trading among smart homes," Applied Energy, Elsevier, vol. 238(C), pages 1434-1443.
    5. 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.
    6. Yael Parag & Benjamin K. Sovacool, 2016. "Electricity market design for the prosumer era," Nature Energy, Nature, vol. 1(4), pages 1-6, April.
    7. Wang, Tonghe & Guo, Jian & Ai, Songpu & Cao, Junwei, 2021. "RBT: A distributed reputation system for blockchain-based peer-to-peer energy trading with fairness consideration," Applied Energy, Elsevier, vol. 295(C).
    8. Jing, Rui & Xie, Mei Na & Wang, Feng Xiang & Chen, Long Xiang, 2020. "Fair P2P energy trading between residential and commercial multi-energy systems enabling integrated demand-side management," Applied Energy, Elsevier, vol. 262(C).
    Full references (including those not matched with items on IDEAS)

    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. Arnob Das & Susmita Datta Peu & Md. Abdul Mannan Akanda & Abu Reza Md. Towfiqul Islam, 2023. "Peer-to-Peer Energy Trading Pricing Mechanisms: Towards a Comprehensive Analysis of Energy and Network Service Pricing (NSP) Mechanisms to Get Sustainable Enviro-Economical Energy Sector," Energies, MDPI, vol. 16(5), pages 1-27, February.
    2. 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).
    3. 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).
    4. 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).
    5. Filipe Bandeiras & Álvaro Gomes & Mário Gomes & Paulo Coelho, 2023. "Exploring Energy Trading Markets in Smart Grid and Microgrid Systems and Their Implications for Sustainability in Smart Cities," Energies, MDPI, vol. 16(2), pages 1-41, January.
    6. 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).
    7. Tushar, Wayes & Yuen, Chau & Saha, Tapan K. & Morstyn, Thomas & Chapman, Archie C. & Alam, M. Jan E. & Hanif, Sarmad & Poor, H. Vincent, 2021. "Peer-to-peer energy systems for connected communities: A review of recent advances and emerging challenges," Applied Energy, Elsevier, vol. 282(PA).
    8. Pere Mir-Artigues & Pablo del Río, 2021. "Prosumers’ Behavior under a Regulation That Encourages Strict Self-Sufficiency. The Case of Spanish Photovoltaic Micro-Generation," Energies, MDPI, vol. 14(4), pages 1-19, February.
    9. Zhou, Yuekuan & Lund, Peter D., 2023. "Peer-to-peer energy sharing and trading of renewable energy in smart communities ─ trading pricing models, decision-making and agent-based collaboration," Renewable Energy, Elsevier, vol. 207(C), pages 177-193.
    10. 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).
    11. Azim, M. Imran & Tushar, Wayes & Saha, Tapan K. & Yuen, Chau & Smith, David, 2022. "Peer-to-peer kilowatt and negawatt trading: A review of challenges and recent advances in distribution networks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 169(C).
    12. Park, Sung-Won & Zhang, Zhong & Li, Furong & Son, Sung-Yong, 2021. "Peer-to-peer trading-based efficient flexibility securing mechanism to support distribution system stability," Applied Energy, Elsevier, vol. 285(C).
    13. Ma, Li & Wang, Lingfeng & Liu, Zhaoxi, 2021. "Multi-level trading community formation and hybrid trading network construction in local energy market," Applied Energy, Elsevier, vol. 285(C).
    14. Andreolli, Francesca & D'Alpaos, Chiara & Kort, Peter, 2023. "Does P2P Trading Favor Investments in PV-Battery Systems?," FEEM Working Papers 330498, Fondazione Eni Enrico Mattei (FEEM).
    15. Karami, Mahdi & Madlener, Reinhard, 2022. "Business models for peer-to-peer energy trading in Germany based on households’ beliefs and preferences," Applied Energy, Elsevier, vol. 306(PB).
    16. 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.
    17. Francesca Andreolli & Chiara D'Alpaos & Peter Kort, 2023. "Does P2P Trading Favor Investments in PV-Battery Systems?," Working Papers 2023.02, Fondazione Eni Enrico Mattei.
    18. Faia, Ricardo & Lezama, Fernando & Soares, João & Pinto, Tiago & Vale, Zita, 2024. "Local electricity markets: A review on benefits, barriers, current trends and future perspectives," Renewable and Sustainable Energy Reviews, Elsevier, vol. 190(PA).
    19. Henri van Soest, 2018. "Peer-to-peer electricity trading: A review of the legal context," Competition and Regulation in Network Industries, , vol. 19(3-4), pages 180-199, September.
    20. Chen, Kaixuan & Lin, Jin & Song, Yonghua, 2019. "Trading strategy optimization for a prosumer in continuous double auction-based peer-to-peer market: A prediction-integration model," Applied Energy, Elsevier, vol. 242(C), pages 1121-1133.

    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:358:y:2024:i:c:s0306261923018913. 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.