Sharing Energy in Wide Area: A Two-Layer Energy Sharing Scheme for Massive Prosumers

TL;DR

This paper introduces a two-layer energy sharing market for prosumers that enhances social efficiency in large-scale systems by combining local sharing and wide-area clearing, supported by a distributed bidding algorithm.

Contribution

It proposes a novel two-layer market structure and an efficient hierarchical bidding algorithm for massive prosumer energy sharing.

Findings

Near-social-optimal market outcomes in large systems

Effective handling of complex MPEC optimization problems

Validated scalability on IEEE 123-bus system with 11,250 prosumers

Abstract

The popularization of distributed energy resources transforms end-users from consumers into prosumers. Inspired by the sharing economy principle, energy sharing markets for prosumers are proposed to facilitate the utilization of renewable energy. This paper proposes a novel two-layer energy sharing market for massive prosumers, which can promote social efficiency by wider-area sharing. In this market, there is an upper-level wide-area market (WAM) in the distribution system and numerous lower-level local-area markets (LAMs) in communities. Prosumers in the same community share energy with each other in the LAM, which can be uncleared. The energy surplus and shortage of LAMs are cleared in the WAM. Thanks to the wide-area two-layer structure, the market outcome is near-social-optimal in large-scale systems. However, the proposed market forms a complex mathematical program with equilibrium constraints (MPEC). To solve the problem, we propose an efficient and hierarchically distributed bidding algorithm. The proposed two-layer market and bidding algorithm are verified on the IEEE 123-bus system with 11250 prosumers, which demonstrates the practicality and efficiency for large-scale markets.