Peer-to-peer trading is a next-generation energy management technique that economically benefits proactive consumers (prosumers) transacting their energy as goods and services. At the same time, peer-to-peer energy trading is also expected to help the grid by reducing peak demand, lowering reserve requirements, and curtailing network loss. However, large-scale deployment of peer-to-peer trading in electricity networks poses a number of challenges in modeling transactions in both the virtual and physical layers of the network. As such, this article provides a comprehensive review of the state-of-the-art in research on peer-to-peer energy trading techniques. By doing so, we provide an overview of the key features of peer-to-peer trading and its benefits of relevance to the grid and prosumers. Then, we systematically classify the existing research in terms of the challenges that the studies address in the virtual and the physical layers. We then further identify and discuss those technical approaches that have been extensively used to address the challenges in peer-to-peer transactions. Finally, the paper is concluded with potential future research directions.

Peer-to-Peer Trading in Electricity Networks: An Overview

The power grid is rapidly transforming, and while recent grid innovations increased the utilization of advanced control methods, the next-generation grid demands technologies that enable the integration of distributed energy resources (DERs)—and consumers that both seamlessly buy and sell electricity. This paper develops an optimization model and blockchain-based architecture to manage the operation of crowdsourced energy systems (CESs), with peer-to-peer (P2P) energy trading transactions (ETTs). An operational model of CESs in distribution networks is presented considering various types of ETT and crowdsourcees. Then, a two-phase operation algorithm is presented: Phase I focuses on the day-ahead scheduling of generation and controllable DERs, whereas Phase II is developed for hour-ahead or real-time operation of distribution networks. The developed approach supports seamless P2P energy trading between individual prosumers and/or the utility. The presented operational model can also be used to operate islanded microgrids. The CES framework and the operation algorithm are then prototyped through an efficient blockchain implementation, namely, the IBM Hyperledger Fabric. This implementation allows the system operator to manage the network users to seamlessly trade energy. Case studies and prototype illustration are provided.

Energy Crowdsourcing and Peer-to-Peer Energy Trading in Blockchain-Enabled Smart Grids

Peer-to-peer energy systems for connected communities: A review of recent advances and emerging challenges

https://oar.princeton.edu/bitstream/88435/pr1w49x/1/OA_MotivationalGameTheoreticApproachPeerPeerEnergyTradingSmartGrid.pdf

A motivational game-theoretic approach for peer-to-peer energy trading in the smart grid

Increase in the deployment of distributed energy resources (DERs) has triggered a new trend to redesign electricity markets as consumer-centric markets relying on peer-to-peer (P2P) approaches. In the P2P markets, players can directly negotiate under bilateral energy trading to match demand and supply. The trading scheme should be designed adequately to incentivise players to participate in the trading process actively. This article proposes a decentralized P2P energy trading scheme for electricity markets with high penetration of DERs. A novel algorithm using primal-dual gradient method is described to clear the market in a fully decentralized manner without interaction of any central entity. Also, to incorporate technical constraints in the energy trading, line flow constraints are modeled in the bilateral energy trading to avoid overloaded or congested lines in the system. This market structure respects market players’ preferences by allowing bilateral energy trading with product differentiation. The performance of the proposed method is evaluated using simulation studies, and it is found that market players can trade energy to maximize their welfare without violating line flow constraints. Also, compared with other similar methods for P2P trading, the proposed approach needs lower data exchange and has a faster convergence.

A Decentralized Bilateral Energy Trading System for Peer-to-Peer Electricity Markets

This paper proposes a novel game-theoretic model for peer-to-peer (P2P) energy trading among the prosumers in a community. The buyers can adjust the energy consumption behavior based on the price and quantity of the energy offered by the sellers. There exist two separate competitions during the trading process: 1) price competition among the sellers; and 2) seller selection competition among the buyers. The price competition among the sellers is modeled as a noncooperative game. The evolutionary game theory is used to model the dynamics of the buyers for selecting sellers. Moreover, an M-leader and N-follower Stackelberg game approach is used to model the interaction between buyers and sellers. Two iterative algorithms are proposed for the implementation of the games such that an equilibrium state exists in each of the games. The proposed method is applied to a small community microgrid with photo-voltaic and energy storage systems. Simulation results show the convergence of the algorithms and the effectiveness of the proposed model to handle P2P energy trading. The results also show that P2P energy trading provides significant financial and technical benefits to the community, and it is emerging as an alternative to cost-intensive energy storage systems.

/pdf/peer-to-peer-energy-trading-in-a-prosumer-based-community-54x1blz37r.pdf

Peer-to-Peer Energy Trading in a Prosumer-Based Community Microgrid: A Game-Theoretic Model

Peer-to-peer (P2P) energy trading is one of the promising approaches for implementing decentralized electricity market paradigms. In the P2P trading, each actor negotiates directly with a set of trading partners. Since the physical network or grid is used for energy transfer, power losses are inevitable, and grid-related costs always occur during the P2P trading. A proper market clearing mechanism is required for the P2P energy trading between different producers and consumers. This paper proposes a decentralized market clearing mechanism for the P2P energy trading considering the privacy of the agents, power losses as well as the utilization fees for using the third party owned network. Grid-related costs in the P2P energy trading are considered by calculating the network utilization fees using an electrical distance approach. The simulation results are presented to verify the effectiveness of the proposed decentralized approach for market clearing in P2P energy trading.

/pdf/peer-to-peer-energy-trading-in-smart-grid-considering-power-1cu00ucydf.pdf

Peer-to-Peer Energy Trading in Smart Grid Considering Power Losses and Network Fees

The concept of community microgrid distribution system presents a new framework for operation and management of the future distribution systems with various operating constraints and a business model. It aims at extending the benefits of traditional microgrid by sharing the energy resources among multiple partners. Peer-to-peer (P2P) energy trading model seems to be one of the suitable models for energy trading in future community microgrid distribution system. This paper proposes a hierarchical peer-to-peer (HP2P) energy trading framework for future community microgrid distribution networks to provide efficient energy trading in the microgrid energy market. The proposed HP2P framework is applied to a sample community microgrid distribution system. It results in cost saving and hence its effectiveness is verified by simulation study.

A Hierarchical Peer-to-Peer Energy Trading in Community Microgrid Distribution Systems

This article presents a scalable mechanism for peer-to-peer (P2P) energy trading among prosumers in a smart grid. In the proposed mechanism, prosumers engage in a non-mediated negotiation with their peers to reach an agreement on the price and quantity of energy to be exchanged. Instead of concurrent bilateral negotiation between all peers with high overheads, an iterative peer matching process is employed to match peers for bilateral negotiation. The proposed negotiation algorithm enables prosumers to come to an agreement, given that they have no prior knowledge about the preference structure of their trading partners. A greediness factor is introduced to model the selfish behavior of prosumers in the negotiation process and to investigate its impact on the negotiation outcome. In order to recover the costs related to power losses, a transaction fee is applied to each transaction that enables the grid operator to recover incurred losses due to P2P trades. The case studies demonstrate that the proposed mechanism discourages greedy behavior of prosumers in the negotiation process as it does not increase their economic surplus. Also, it has an appropriate performance from the computation overheads and scalability perspectives.

Amrit Paudel

Papers

Peer-to-Peer Energy Trading in a Prosumer-Based Community Microgrid: A Game-Theoretic Model

Peer-to-Peer Energy Trading in Smart Grid Considering Power Losses and Network Fees

A Hierarchical Peer-to-Peer Energy Trading in Community Microgrid Distribution Systems

A New Method for Peer Matching and Negotiation of Prosumers in Peer-to-Peer Energy Markets

A Proof-of-Stake public blockchain based pricing scheme for peer-to-peer energy trading