Proposal of New Mechanisms in Decentralized Electricity Trading among Small-scale Consumers

Abstract

Global warming and a rising energy prices have recently motivated various countries to promote introduction of renewable energy generations. However, energy generations such as photovoltaic power generation bring about unexpected fluctuation and thereby might violate simultaneous balancing electricity demand and supply. Against this situation, the Smart Grid concept has lately attracted attention. In the smart grid concept, mutual information exchange among suppliers and consumers can be achieved to balance and optimize the supply and demand of electricity. In addition, the necessity for electricity trade by which small-scale consumers such as households buy and sell electricity is now advocated to realize further stability of the grid system. This study proposes new trading mechanisms applied in the electricity trade and evaluates them in terms of electricity price and social surplus in the market. All the four mechanisms we propose in this study are simple enough for small-scale consumers to trade electricity everyday and we examine their validity using multi-agent simulations. Results demonstrate that the market-driven mechanism integrating all demand and supply attains higher surplus.