Operationally-Safe Peer-to-Peer Energy Trading in Distribution Grids: A Game-Theoretic Market-Clearing Mechanism

TL;DR

This paper proposes a game-theoretic, distributed market-clearing mechanism for peer-to-peer energy trading in distribution grids, ensuring safety, efficiency, and scalability, with proven convergence to an optimal equilibrium.

Contribution

It introduces a novel generalized aggregative game model and a distributed clearing mechanism with convergence guarantees for safe and efficient energy trading.

Findings

The mechanism converges to a variational generalized Nash equilibrium.

Numerical results demonstrate scalability on IEEE 37-bus system.

Active participation benefits prosumers and the network operator.

Abstract

In future distribution grids, prosumers (i.e., energy consumers with storage and/or production capabilities) will trade energy with each other and with the main grid. To ensure an efficient and safe operation of energy trading, in this paper, we formulate a peer-to-peer energy market of prosumers as a generalized aggregative game, in which a network operator is only responsible for the operational constraints of the system. We design a distributed market-clearing mechanism with convergence guarantee to an economically-efficient and operationally-safe configuration (i.e., a variational generalized Nash equilibrium). Numerical studies on the IEEE 37-bus testcase show the scalability of the proposed approach and suggest that active participation in the market is beneficial for both prosumers and the network operator.