Coordinating Consumer-Centric Market and Grid Operation on Distribution Grid

The increasing penetration of distributed energy resources, along with developments in house management systems, are supporting prosumers to play an active role in the electricity market. In particular, a peer-to-peer (P2P) electricity market is an attractive framework to allow direct transactions between prosumers. However, this may raise several challenges in the operation and management of the distribution grid. In this context, the main contribution of this paper is the design of P2P electricity markets taking into account grid characteristics while solving potential congestion and voltage problems. The paper proposes a coordination methodology between P2P markets and distribution system operator (DSO) allocating a grid tariff to the prosumers that cause grid limit violations. Such tariff is defined based on the euclidean distance among trading prosumers, which is implemented in the P2P market through product differentiation approach. The proposed methodology is compared to a benchmark model in a representative distribution grid with 138 nodes and 109 prosumers. An important conclusion is that the proposed methodology is capable of achieving a trade-off between prosumers P2P transactions and grid operation.