Decentralized Energy Market Integrating Carbon Allowance Trade and Uncertainty Balance in Energy Communities

Abstract

With the sustained attention on carbon neutrality, the personal carbon trading (PCT) scheme has been embraced as an auspicious paradigm for scaling down carbon emissions. To facilitate the simultaneous clearance of energy and carbon allowance inside the energy community while hedging against uncertainty, a joint trading framework is proposed in this article. The energy trading is implemented in a peer-to-peer (P2P) manner without the intervention of a central operator, and the uncertainty trading is materialized through procuring reserve of conventional generators and flexibility of users. Under the PCT scheme, carbon allowance is transacted via a sharing mechanism. Possible excessive carbon emissions due to uncertainty balance are tackled by obliging renewable agents to procure sufficient carbon allowances, following the consumption responsibility principle. A two-stage iterative method consisting of tightening Mc-Cormick envelope and alternating direction method of multipliers (ADMM) is devised to transform the model into a mixed-integer second-order cone program (MISOCP) and to allow for a fully decentralized market-clearing procedure. Numerical results have validated the effectiveness of the proposed market model.

Towards a Low Carbon Future: Evaluating Scenarios for an Energy Community Through a Multi-Objective Optimisation Approach

“…With lower environmental impacts and higher energy efficiencies, ECs have a substantial cost advantage if inserted in a carbon trading ecosystem [26]. Moreover, a personal carbon trading (PCT) scheme has been discussed in literature [27,28], as a promising and innovative policy tool to mitigate carbon emissions at the household and individual level, and to encourage the adoption of low-carbon lifestyles. In this sense, the present work analysed the cost of CO2eq emissions reduction based on the data from Fig.…”