Peer-to-Peer Energy Trading in Microgrids: Towards an Integrated Open and Distributed Market

Abstract

This work focuses on the electric power market, comparing the status quo with the recent trend towards the increase in distributed self-generation capabilities by prosumers. Starting from the existing tension between the intrinsically hierarchical current structure of the electricity distribution network and the substantially distributed and self-organising nature of the self-generation, we explore the limitations imposed by the current conditions. Initially, we introduce a potential multi-layered architecture for a Peer-to-Peer (P2P) energy market, discussing the fundamental aspects of local production and local consumption as part of a microgrid. Secondly, we analyse the consequent changes for the different users' roles, also in connection with some incentive models connected with the decentralisation of the power production. To give a full picture to the reader, we also scrutinise relevant elements of energy trading, such as Smart Contract and grid stability. Thirdly, we present an example of a typical P2P settlement, showcasing the role of all the previously analysed aspects. To conclude, we performed a review of relevant activities in this domain, to showcase where existing projects are going and what are the most important themes covered. Being this a work in progress, many open questions are still on the table and will be addressed in the next stages of the research. Eventually, by providing a reference model as base for further discussions and improvements, we would like to engage ourselves in a dialog with the different users and the broad community, oriented towards a more fair and ecological-friendly solution for the electricity market of the future.

Community-Based Microgrids: Literature Review and Pathways to Decarbonise the Local Electricity Network

“…The SGAM model [21] represents five interoperable layers, namely, component, communication, information, function and business layer features, by domains and the zones of the operations. Focusing more on market participation, a multi-layered architecture for the P2P deregulated energy market is discussed in [23], with five layers describing the management and operations of the system. The device layer contains physical components installed at individual premises, factories and assets in the electrical distribution network.…”

“…The data can be transmitted through different communication protocols, such as Message Queuing Telemetry Transport (MQTT), Data Distribution Service (DDS), Power-Line Communication (PLC), Wi-Fi, Long-Range Wide-Area Network (LoRaWAN), etc., depending upon the appropriateness and distance of communication. The selection of protocols can affect numerous aspects, such as scalability, regulatory compliance and energetic footprint [23]. Issues such as connection drops and finite bandwidth will lead to low-quality data, which will subsequently impact the control decisions, meaning that the entire operation can malfunction.…”

Blockchain, Data Protection and P2P Energy Trading: A Review on Legal and Economic Challenges

“…As BCT-based platforms for P2P energy trading process a large amount of prosumers data, they have posed unprecedented challenges for data protection. Indeed, several issues concern user anonymity, privacy [19], the governance of BCT systems [16] and the role of energy market players [20][21][22][23][24]. It implies that BCT represents an interdisciplinary research field which involves technical, legal and economic aspects [25].…”

Mathematical programming-based models for the distribution networks' decarbonization

“…A P2P energy trading architecture includes between six [174], or four [175] layers for proper implementation. These layers comprise the grid infrastructure, participants in the LEM, and the communication and control systems.…”