Peer-to-Peer Energy Trading and the Sharing Economy: Social, Markets and Regulatory Perspectives

Abstract

Peer-to-peer (P2P) energy trading is a new data-driven business model currently being trialed within the energy sector. Introducing P2P transactions to an essential service such as energy could have far-reaching implications for individuals and the grid. This paper raises considerations and questions from social, economic/markets and regulatory points of view, that should be understood and addressed by societies and policymakers. It does this by considering under what circumstances it is reasonable to conceptualize P2P energy trading as part of the sharing economy, and drawing parallels to the sharing economy experience in other sectors. In order to reap the full societal benefits, while avoiding considerable risks to infrastructure and individuals, a policy approach promoting dialogue and innovation is necessary. We suggest the regulatory sandbox is the most appropriate tool to achieve this and would help avoid the breakdown of trust between policymakers and platform companies observed in other sectors.

Blockchain Enabled Decentralized Local Electricity Markets With Flexibility From Heating Sources

“…The innovation of peer-to-peer electricity trading enables prosumers to directly exchange electricity in local markets for regional energy balance. The peer-to-peer electricity trading has been well documented in terms of the architecture design [1]- [3], pricing design [4], [5], auction mechanisms [6], [7], and regulations [24], for which the game-theoretic approaches have been widely applied to analyze the decision making and interactions among stakeholders. In [1], the key elements and technologies of the peer-to-peer electricity trading were identified and categorized into a hierarchical system architecture, in which the trading behaviors were modeled through using the game theory.…”

“…Reference [7] designed a uniform-price auction mechanism for peer-to-peer energy trading in both sellers and buyers' markets for an efficient energy allocation. Schneiders et al [24] investigated practical regulations and regulatory trails for implementing the peer-to-peer electricity trading, and identified the policy barriers for policy makers in order to reap the social benefits while avoid risks on power system infrastructures and prosumers.…”

Expansion of servitization in the energy sector and its implications

“…Many countries are using the regulatory sandbox to promote new technologies in the energy sector (IEA ISGAN, 2019; Schneiders et al, 2021). However, there are cases in which the regulatory sandbox has not been passed due to conflicts of interest.…”

Peer-to-Peer Energy Trading and the Sharing Economy: Social, Markets and Regulatory Perspectives

“…For example, could the knowledge that you are using electricity from your local school, or your neighbor, or your parents, result in you using electricity differently? The power of narrative and storytelling in energy has been demonstrated (Moezzi, Janda, and Rotmann 2017), but further research on its role in this context would be required to test this hypothesis.…”