A New Method for Peer Matching and Negotiation of Prosumers in Peer-to-Peer Energy Markets

Mohsen Khorasany, Amrit Paudel, Reza Razzaghi, Pierluigi Siano

Research output: Contribution to journalArticleResearchpeer-review

Abstract

This paper presents a scalable mechanism for peer-to-peer (P2P) energy trading among prosumers in a smart grid. In the proposed mechanism, prosumers engage in a non-mediated negotiation with their peers to reach an agreement on the price and quantity of energy to be exchanged. Instead of concurrent bilateral negotiation between all peers with high overheads, an iterative peer matching process is employed to match peers for bilateral negotiation. The proposed negotiation algorithm enables prosumers to come to an agreement, given that they have no prior knowledge about the preference structure of their trading partners. A greediness factor is introduced to model the selfish behavior of prosumers in the negotiation process and to investigate its impact on the negotiation outcome. In order to recover the costs related to power losses, a transaction fee is applied to each transaction that enables the grid operator to recover incurred losses due to P2P trades. The case studies demonstrate that the proposed mechanism discourages greedy behavior of prosumers in the negotiation process as it does not increase their economic surplus. Also, it has an appropriate performance from the computation overheads and scalability perspectives.

Original languageEnglish
JournalIEEE Transactions on Smart Grid
DOIs
Publication statusAccepted/In press - 31 Dec 2020

Keywords

  • Computational complexity
  • Decentralized algorithm
  • Economics
  • Indexes
  • market design
  • multi-issue negotiation
  • Optimization
  • Peer-to-peer computing
  • peer-to-peer market
  • prosumer
  • Scalability
  • Smart grids
  • smart grids
  • transaction fee.

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