A network-aware peer-to-peer energy trading framework with dynamic pricing mechanism

Abstract

This article proposes a comprehensive framework for Peer-to-Peer (P2P) energy trading on the radial distribution network. First, a time-series-based day-ahead market clearing mechanism is proposed for P2P energy trading, which co-optimizes the peer matching process and distribution network operations in order to achieve optimal P2P trades. Second, we propose a dynamic pricing mechanism that considers both the supply-demand ratio and the prevailing grid prices to determine the pricing signal for P2P energy trading. 15-bus radial distribution network is used to evaluate the proposed framework. The simulation results indicate that the developed market clearing mechanism optimally schedules the prosumers’ distributed energy resources and matches them with their peers in a manner that maximizes social welfare without violating network constraints. In addition, the proposed pricing mechanism offers peers better rates than grid prices and incentivizes them to maintain network health.