A Novel Transactive Energy Market Model for Residential Energy Hubs

Abstract

The rise of distributed energy generation and storage is creating new opportunities for energy consumers to actively engage with energy markets. Achieving these potential benefits will require the implementation of new business models to address limitations of existing market structures. One promising area of research involves the use of peer to peer trading systems via residential energy hubs. These local area trading systems can increase renewable energy generation through improved infrastructure utilisation and financial returns. However, facilitating these trading systems is challenging due to the constraints of physical laws and energy losses. The model presented in this paper addresses these challenges by demonstrating a transactive energy market structure for local energy trading that accounts for physical constraints and losses. It fairly allocates the gains of trade and incentivises agents to minimise distribution losses. This market structure can be implemented with existing metering data and approximate values of electrical distribution network properties.