Peer-to-peer trading under subscribed capacity tariffs - an equilibrium approach

Abstract

Local peer-to-peer (P2P) markets are envisioned as a promising market design to integrate the increasing number of agents in the distribution grid. To incentivize grid-friendly consumption profiles, we suggest a subscribed capacity tariff where end-users pay for a capacity level with a high excess energy term. The P2P market functions as a capacity market where end-users buy capacity from other agents when needed. We demonstrate the concept by formulating the local P2P market equilibrium problem as a mixed complementarity problem (MCP). Analysis of a neighborhood case study shows that both aggregated peak load and agent costs decreases.