Impact of local electricity markets and peer-to-peer trading on low-voltage grid operations

As penetration of variable renewable energy sources (VRES) continues to increase, more creative approaches must be taken to balance supply and demand than has been necessary in the past. One of these ideas is to create local energy communities (LECs) where households trade electricity with their neighbors directly, instead of buying and selling from the local utility (a process known as peer-to-peer trading, or P2P trading). Given its novel and still largely theoretical nature, the effects of such a community’s effect on the local low-voltage electricity networks are still largely unknown. A recent paper by BEYOND partners NTNU and SINTEF investigates this effect.

The study suggest that the creation of local markets reduces total electricity costs, improves self-consumption, and promotes more effective use of local distributed energy resources. These LECs are considered in two cases: one in which houses have solar PV panels installed, and one in which these houses also have batteries. The battery + PV case nearly doubles the amount of electricity traded in the community compared to the PV-only case.

The overall results show that establishing a P2P system for the PVs within the LEC reduced peak grid import and total system losses by 13.7% and 44.7% respectively, in addition to reducing the total amount of electricity procured from the wholesale market by 5%. The inclusion of batteries in these communities further reduces overall community costs, but has some adverse effects on voltage and peak grid consumption. This is due to the large amount of battery charging that takes place in the early morning when electricity prices are lowest. This is shown in the Figure below:

Uncontrolled battery charging leads to voltage drops and an increased peak consumption of 19.2% compared to the reference case. While the results of this case study are highly system dependent, it is a valuable contribution to the body of research surrounding this topic.

The paper can be viewed in full at:

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