Transactive energy systems use principles of value to coordinate responsive supply and demand in energy systems. Work continues within the Transactive Systems Program, which is funded by the U.S. Department of Energy at Pacific Northwest National Laboratory, to understand the value of, understand the theory behind, and simulate the behaviors of transactive energy systems. This report summarizes recent advances made by this program. The main capability advances include a more comprehensive valuation model, including recommended documentation that should make valuation studies of all sorts more transparent, definition of economic metrics with which transactive mechanisms can be evaluated, and multiple improvements to the time-simulation environment that is being used to evaluate transactive scenarios. v Summary Transactive system designs are intended to drive electric system operations toward an optimal balance of supply and demand at all levels of the grid. To accomplish this, they actively seek the engagement of all potentially responsive electrical assets, including customer-owned and third-party assets, through transparent, competitive means. This provides the flexibility required by tomorrow's power grid, whether generation shifts from centralized to more distributed resources or from dispatchable generation plants to intermittent renewables. Operating such a grid, capable of powering our society by providing the reliability and affordable electricity rates it demands, necessitates new operational flexibility from resources on a large scale. In order to do this at reasonable cost, much of this flexibility is expected to be derived from distributed assets such as continually responsive loads, distributed electrical and thermal storage, smart inverters for solar photovoltaic systems, electric vehicles, etc. The U.S. Department of Energy's (DOE's) Transactive Systems Program (TSP) encourages the development of transactive designs that offer systematic, scalable, and equitable approaches for managing energy system operations. Because several designs have already been proposed, some have also been and demonstrated in the field, and more are sure to follow, the program works to inform decision makers on alternative transactive designs and their characteristics. It does this by developing a simulation environment capable of testing a variety of transactive system designs. This includes establishing a set of test scenarios with realistic models and data sets for testing such alternative transactive system designs. In addition, criteria and a disciplined process for evaluation are proposed as part of the TSP's valuation methodology element. The valuation criteria are supplemented with systemic criteria for measuring proper behavior of the transactive system being studied on topics such as scalability, optimality, and convergence. These are derived from TSP elements that contribute to a theoretical framework for transactive systems. This document reports on an early trial of the first year's progress developing an analy...
