# Assessing the techno-economic benefits of LEMs for different grid topologies and prosumer shares

## TL;DR

This study shows that local energy markets can significantly lower energy prices and reduce grid strain in most scenarios, but their success depends on minimizing extra costs and bureaucracy.

## Contribution

The paper introduces a comprehensive techno-economic analysis of local energy markets across 400 grid configurations with varying renewable energy penetration.

## Key findings

- Local energy markets reduced average energy prices in 99% of the scenarios.
- Operational peak power levels were reduced by 80% in most cases.
- LEM viability is highest in areas where energy generation and demand align.

## Abstract

The shift toward decentralized and renewable energy sources has introduced significant challenges to traditional power systems, necessitating innovative market designs. Local energy markets present a viable solution for integrating distributed energy resources such as photovoltaic systems, electric vehicles, and heat pumps. This study investigates the techno-economic implications of local energy markets compared to conventional market designs, focusing on their impact on average energy prices and operational peak power. Through comprehensive simulations across various grid topologies with varying penetration levels of the distributed energy resources, totaling 400 simulation setups, we demonstrate that local energy markets can enhance economic efficiency and grid stability with 99% of the scenarios boasting lower average energy prices and 80% lower operational peak power levels. The findings suggest that local energy markets can play a role in the future energy system, provided that additional infrastructure, management costs, and bureaucratic complexity are kept to a minimum.

•400 different configurations of grid topology, PVs, EVs, and heat pumps are analyzed•Local energy markets can reduce economic burden in 99% of the cases and technical in 80%•They are especially suitable in areas where generation and demand coincide often•Minimizing additional costs and bureaucracy is crucial for LEM viability

400 different configurations of grid topology, PVs, EVs, and heat pumps are analyzed

Local energy markets can reduce economic burden in 99% of the cases and technical in 80%

They are especially suitable in areas where generation and demand coincide often

Minimizing additional costs and bureaucracy is crucial for LEM viability

Energy engineering; Energy resources; Energy sustainability