Towards a Peer-to-Peer Energy Market: an Overview

TL;DR

This paper explores the design and implications of a peer-to-peer energy market, emphasizing decentralized microgrid trading, user roles, incentives, and smart contracts, aiming to foster a fairer and more sustainable electricity system.

Contribution

It proposes a multi-layered architecture for P2P energy trading, analyzes user roles and incentives, and reviews current projects to guide future research and development.

Findings

Proposed a P2P energy market architecture.

Analyzed user roles and incentive models.

Reviewed existing projects and future challenges.

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.