- The paper introduces a cooperative Stackelberg game framework where the CPS sets high peak prices to incentivize prosumers to trade energy, relieving grid stress.
- It derives a closed-form equilibrium price and employs auction-based and mid-market pricing strategies to ensure stable and transparent coalition formation.
- Numerical simulations confirm that the approach minimizes the need for costly reserve energy while reducing prosumer expenses during peak demand periods.
Grid Influenced Peer-to-Peer Energy Trading: An Analytical Framework
The paper "Grid Influenced Peer-to-Peer Energy Trading" presents a comprehensive analysis of a peer-to-peer (P2P) energy trading framework that integrates with centralized power systems to manage electricity demand during peak hours. This trading mechanism is formalized using a cooperative Stackelberg game model, where the centralized power system (CPS) acts as the leader and prosumers as followers. The primary objective is to incentivize prosumers to meet their energy demand through P2P trading, thus alleviating the burden on the CPS during high-demand periods.
Cooperative Stackelberg Game and Equilibrium
The proposed scheme involves a Stackelberg game where the CPS, as the leader, sets a high electricity price at peak demand times to influence prosumers to engage in P2P trading. The CPS's pricing strategy during peak periods is crucial, and a closed-form expression of the equilibrium price is derived to minimize its cost effectively. Prosumers respond to the CPS's decision by forming coalitions to trade energy amongst themselves, choosing either auction-based or mid-market pricing strategies for P2P transactions.
The game theory analysis demonstrates that a unique and stable Stackelberg equilibrium exists due to the strategy-proof nature of the auction process among prosumers. The auction mechanism ensures that participants reveal their true preferences, thereby stabilizing coalition formation. The prosumer-centric perspective is validated through properties like transitivity, dominance, and rational-economic behavior, reinforcing the potential for widespread adoption among prosumers.
Implications and Numerical Results
Numerical simulations in the paper illustrate the significant benefits achieved by adopting this model. At the equilibrium, the CPS can achieve zero additional cost by not needing to draw on expensive reserve energy to meet prosumer demand. On the other hand, prosumers benefit economically through reduced energy costs compared to conventional grid pricing, particularly during peak hours.
The model's modularity is highlighted in its ability to adapt pricing strategies in response to the varying demand profiles of prosumers. This adaptability ensures a dynamic balance between supply and demand, leveraging P2P platforms to enhance grid reliability and efficiency.
Future Directions and Impact
The paper addresses key components necessary for integrating P2P energy trading within existing energy systems, emphasizing both economic and operational scalability. However, several avenues for future work remain, including addressing the impact of demand uncertainty and further exploration of prosumer non-cooperative behavior and its implications on coalition dynamics.
In conclusion, the research provides an insightful approach to modernizing grid operations through P2P energy trading. The framework aligns with the increasing penetration of distributed energy resources and could drive significant improvements in grid sustainability and energy market designs. As P2P systems continue to evolve, the findings could foreseeably contribute to shaping policy and technological advancements in the energy sector.