Showing papers on "Energy market published in 2023"

Pricing and Simulating Energy Transactions in Energy Communities

Abstract: Extensive literature is available for modeling and simulating local electricity markets, often called P2P electricity markets, and for pricing local energy transactions in energy communities. Market models and pricing mechanisms provide simulation tools to better understand how these new markets behave, helping to design their main rules for real applications, and assessing the financial compensations of the internal energy transactions. As such, pricing mechanisms are often needed in energy management systems when centralized management approaches are preferred to market-based ones. First, this paper highlights the links between local electricity markets, pricing mechanisms for local electricity transactions, and other approaches to sharing the collective benefits of participating in transactive energy communities. Then, a standard nomenclature is defined to review some of the main pricing mechanisms for local energy transactions, an innovative pricing mechanism based on the economic principles of a post-delivery pool market is proposed, and other relevant approaches for local electricity market simulation such as Nash equilibrium or agent-based simulation are also revisited. The revision was based on systematic searches in common research databases and on the authors’ experience in European and national projects, including local industrial applications for the past five years. A qualitative assessment of the reviewed methods is also provided, and the research challenges are highlighted. This review is intended to serve as a practical guide to pricing mechanisms and market simulation procedures for practical designs of internal financial compensation to share the collective benefits of energy communities.

Review of Selected Aspects of Wind Energy Market Development in Poland and Lithuania in the Face of Current Challenges

Abstract: The disruption of fossil fuel supply chains due to the war in Ukraine has resulted in the need for an urgent reorganisation of the energy supply system, the cost of which has created a substantial increase in electricity prices in many markets. In light of the above, the need for the development of a renewable energy market has become stronger than ever; hence, the authors of this study have oriented their efforts towards investigating the development of the renewable energy market in countries bordering the line of armed conflict in Ukraine, i.e., Poland—strongly dependent on traditional forms of energy production—and Lithuania. The primary objective of the paper is to review the literature on wind energy, which is necessary to establish the current role of this energy dimension in the renewable energy market in the energy systems of Poland and Lithuania. Therefore, this review paper is oriented towards a review and evaluation of the available thematic literature and industry studies, as well as conclusions related to the number and direction of research topics in the area of the explored issues. The basic finding of this review is that the reviewed literature and studies are most strongly oriented towards a general assessment of the ongoing energy transition in the world, in which the thread of the assessment of the energy situation in Poland and Lithuania, including the thread of the analysis of wind energy, is part of broader assessments, most often regarding EU countries. The wind energy of the countries included in the scope of the review is not discussed comprehensively. The gap identified in this respect relates in particular to the aspect of wind energy development potential concerning solutions targeted at the individual consumer. In quantitative terms, studies addressing wind energy in Lithuania represent a lower percentage of the thematic literature acquired for the review. In the area of noted niches, the need for research and analysis is recommended to increase the information supply for developing the renewable energy market in Poland and Lithuania. In doing so, it is important to explore the technical and technological solutions (with a focus on the individual customer) and the economic aspects of wind installations from a micro and macro perspective. In addition, there is a lack of sufficient studies revealing the position of public opinion regarding the development of this dimension of the RES market and the direction of its changes. This is an important problem—particularly in Poland, where the so-called distance law constantly blocks the development of this dimension of RES and where the need to develop energy from renewable sources is particularly urgent.

Operation of the Multiple Energy System with Optimal Coordination of the Consumers in Energy Market

Abstract: Abstract In this paper, optimal coordination of the demand side under uncertainty of the energy price in energy market is studied. The consumers by demand response programs (DRPs) have optimal role in minimization of the energy generation costs in multiple energy system. The consumers can participate via local generation strategy (LGS) and demand curtailment strategy (DCS). The optimal coordination is considered as two stage optimization, in which minimization of the consumers’ bills is done in first stage. In following, the minimization of the generation costs is performed in second stage optimization. The LGS is taken into accounted through optimal discharging of plug electric vehicles (PEVs). Finally, numerical simulation is implemented to show superiority of the proposed approach to minimization of the energy generation costs.

Energy Trading Strategy of Distributed Energy Resources Aggregator in Day-Ahead Market Considering Risk Preference Behaviors

Abstract: Distributed energy resources aggregators (DERAs) are permitted to participate in regional wholesale markets in many counties. At present, new market players such as aggregators participate in China’s power market transactions. However, studies related to market trading strategy have mostly focused on centralized wind power and PV generation units. Few studies have been conducted on the decision-making strategies for DERAs in China’s power market. This paper proposes an auxiliary decision-making model for distributed energy systems to participate in the day-ahead market with more reasonable trading strategies. Firstly, the Gaussian mixture model (GMM) is used to deal with the uncertainties of wind power and photovoltaic (PV) output in the distributed energy system. Secondly, the information gap decision theory (IGDT) is used to deal with the uncertainty of price fluctuations in the spot electricity market. Thirdly, according to the different risk preferences of the DERAs facing market price fluctuation, the robust decision model and opportunity decision-making model in the day-ahead market are constructed, respectively. Finally, to deal with the irrational behavior of the DERAs’ perception of “gain” and “loss” with market risks in China’s two-tier market environment, the prospect theory and the marine predator’s algorithm (MPA) are employed to obtain a day-ahead trading decision scheme for DERA. The analyses show that RDES with robust preference can withstand greater price volatility in the day-ahead market; they will reduce the bidding expectations and increase the system operating cost to improve the achievability of the expected revenue. However, DERAs under the opportunity strategy is more inclined to sell electricity to the market and offset system operating costs with revenue. The proposed model can provide strategic reference for DERAs with different risk preferences to bid in day-ahead market and can improve the level of aggregators’ participation in electricity trading.

Peer to Peer Energy Transaction Market Prediction in Smart Grids using Blockchain and LSTM

Abstract: Predicting future demand for distributed energy sources is difficult because of the energy generations is unpredictability. We proposed an auto executable blockchain-based peer-to-peer energy transaction market with Long ShortTerm Memory (LSTM) neural network for energy trading and predictions. Our proposed energy transaction market and trading strategy are built via smart contracts inside the blockchain. The energy trading process in the market is auto executable and does not need a long waiting time as in the conventional bidding strategy. LSTM is integrated into the market for predicting future energy usage. Experimental results show that the proposed blockchain-based peer-to-peer energy transaction market can earn more profit than the traditional method.

Fuzzy Decision-Based Energy Management of Energy Grids with Hubs considering Participation of Hubs and Networks in the Energy Markets

Abstract: With the creation of competitive environments, such as electricity market, it is expected that energy networks and active consumers such as energy hubs participate in the market to promote their economic situation. So, the article proposes the optimal involvement of energy networks and hubs in energy markets in two wholesale and retail designs based on the energy management system at the same time. The proposed scheme is expressed as two-objective optimization. The first objective is to minimize the cost of different types of energy in electricity-gas-thermal networks. In another objective function, the cost of energy (which is the difference between the energy purchase cost and energy sale income) of energy hubs in the retail market is minimized. The scheme is bound to optimal power flow equations of the mentioned networks and operating model of power sources and active loads. Then, the Pareto optimization mixed with the sum of weighted functions helps extract an optimal compromise solution on the basis of fuzzy decision-making. Finally, the scheme is applied to a test system, and the obtained numerical results confirm that energy hubs are improved financially, and economic and operation conditions of the electricity-gas-thermal networks are enhanced simultaneously. So, significant profit can be achieved for EHs in the retail energy market. The economic situation of the networks enhances up to roughly 10% compared with that of power flow studies. Also, operating situation of the networks enhances by about 12% to 53% compared with a case without EHs.

Community Market Based Energy Trading Among Interconnected Microgrids With Adjustable Power

Abstract: Interconnected microgrids (MGs) system is regarded as one of the future power system configurations, where individual MGs can support each other through interchanging energy. This paper presents a community market structure to manage the energy trading among MGs and also with the main grid. In local layer, individual MGs would operate and bid as autonomous entities; in market layer, an independent third party would coordinate the energy transaction among different MGs by mimicking the role of auctioneer. To cost-effectively utilize the controllable units in MGs, the concept of adjustable power is discussed. Apart from the surplus or deficit energy, adjustable power is also incorporated in the individual MGs’ bidding strategies. The local trading prices are determined via the market clearing. We analyze the economic benefits of such an energy trading mechanism and also the value of adjustable power. Numerical results demonstrate the effectiveness of the proposed framework for the energy trading among multiple MGs system.

Application of a Community Battery-Integrated Microgrid in a Blockchain-Based Local Energy Market Accommodating P2P Trading

Abstract: This paper presents the application of a community battery energy storage system (CBESS)-integrated microgrid (MG) in a blockchain-enabled local energy market (LEM). The proposed LEM balances the community energy requirement while facilitating frequent peer-to-peer (P2P) energy transactions between several energy users in the presence of both energy supplier and energy operator. The architecture is formulated by taking a number of local market and network constraints, that include residential battery energy storage system (RBESS) constraints; CBESS constraints; P2P traded price constraints; P2P traded power constraints; margin constraints of the stakeholders; power grid export and import constraints; and network energy balance constraints, so as to not only incentivise energy users but also reduce import/export from/to power grid while keeping the margins of energy supplier and energy operator unaffected. Different types of transactions data including energy users’ P2P pricing bids and P2P traded energy volume are also stored in the blockchain database. Further, the developed LEM framework is also validated through a case study executed on an actual Australian power grid network, comprising 260 residential energy users; two energy suppliers; an energy operator; and a CBESS, and the performance of the proposed P2P trading-based LEM strategy is compared with the existing business-as-usual (BAU) that directs energy users to buy/sell energy at the time-of-use (ToU)/ feed-in-tariff (FiT) rate. The extensive and comparative simulation results confirm the superior performance of the proposed LEM mechanism in terms of minimising energy users’ electricity bill; lowering power grid import and export; and retaining margins of energy suppliers and the energy operator; and thus, emphasise its application suitability in the current electricity market.

Allocative Efficiency towards Energy Transition: The Cases of Natural Gas and Electricity Markets

Abstract: Conventional economic theory indicates that the free market contributes to allocative efficiency. However, specific energy markets present network industry characteristics which distance them from perfect competition. These markets, therefore, need effective regulation. The liberalizing reforms which took place in the Organization for Economic Cooperation and Development (OECD) and emerging countries from the 1990s onwards have reduced the share of state ownership in the energy sector, but not its functions of regulation, coordination and planning. It is also worth noting the expansion of the government’s agenda due to the energy transition that has unequivocally imposed itself in the 21st century. This article uses the Slacks-Based Measure of the Data Envelopment Analysis (SBM-DEA) methodology to investigate the relationship between market liberalization and sustainability in a low-carbon energy transition context. Taking the cases of the natural gas and electricity markets, we verify whether liberalization contributes to the progress of the energy transition, driven by the emergency need to tackle climate change. The results show that the most advanced markets, in their processes of opening up, tend to be positively associated with a more vigorous energy transition. European nations, such as the United Kingdom and Norway, have experienced a relatively more advanced market liberalization leading to an efficient path toward energy transition. Chile, Canada and Colombia also have efficient scores regarding their energy transitions. For low performing countries, such as Brazil, the study suggests some calls for action that should be pursued to improve their energy market indicators, resulting in a stronger energy transition towards renewables, more competitive energy prices and a larger participation of natural gas in the energy mix, which will contribute to decreasing its external dependency.

Network evolution underneath the volatility spillover in traditional and clean energy markets

Abstract: When facing volatility spillovers in energy markets, all players require risk mitigation strategies to insulate themselves from the same. To prevent energy markets from being strongly crashed by volatility spillovers, which even trigger financial crises, in this paper, we use network analysis as an aid to identify spillovers among the main nine energy markets. Specifically, we first measure the volatility spillovers among the main energy markets through a BEKK model. Based on this, influential markets are identified by using network analysis. The coal, wind and water energy markets should be paid close attention as they occupy vital roles in the volatility spillover network. Even though clean energy markets contribute more in terms of market stability, traditional energy markets are still important to ensure energy supply when experiencing extreme crashes caused by COVID-19. In this paper, we make the contributions to analysing volatility spillovers in multiple energy markets and identifying crucial energy markets in volatility spillover networks, then provide more market information that helps the government and policymakers effectively manage systemic risks caused by volatility spillovers. The effective risk management of crucial energy markets enhances economic recovery and stability, especially in the post-COVID-19 era.