Fully decentralized approach for peer-to-peer energy trading in smart grid

Abstract

Over the years, there is an increasing presence of proactive agents in the current power system. As the world is advancing with the aid of technology, there is a need for a more decentralized power system and electricity market. For implementing a decentralized electricity market, P2P (Peer-to-peer) energy trading is one of the promising approaches. This study aims to develop a proper market-clearing mechanism for P2P energy trading between producers and consumers. In this context, P2P trading platform allows agents to negotiate directly during trading with ease. This reduces the hassle of going through an intermediary. This paper aims to test the effectiveness of the proposed decentralized approach for P2P energy trading as compared to a centralized approach for P2P energy trading. To accomplish the task, the use of simulation platform MATLAB (MATrix LABoratory) is necessary. The algorithm developed in MATLAB will show a comparison of different results through simulations and graphs. Besides, this project further categorized decentralized P2P energy trading into four different cases by exempting power losses and network fees initially, and progressively introducing them back into the energy trading platform. Overall, with these simulation results, the difference between a decentralized and centralized approach are minimal. On this basis, the concept of developing a P2P energy trading market is feasible.