Peer-to-Peer Energy Trading in the Real World: Market Design and Evaluation of the User Value Proposition

Electricity markets are experiencing a shift to a more decentralized structure with small distributed renewable generation sources like residential photovoltaic systems. Simultaneously, information systems have driven the development of a “sharing economy” also in the electricity sector and can enable previously passive consumers to directly trade solar electricity in local communities. However, it is unclear how such peer-to-peer (P2P) markets should be designed to create value for the user. In a framed field experiment, we design and implement Switzerland’s first real-world P2P electricity market in a local community. We examine its value proposition for the users and elicit user preferences by enabling the participants to directly influence buy and sell prices for local solar energy. The collected empirical evidence suggests that the P2P exchange is beneficial for users and provides incentives for generation of renewable energy. The results create valuable insights for the design and diffusion of future energy markets

Design and implementation of a blockchain multi-energy system

Abstract The growing adoption of photovoltaic panels on roof-tops increases the pressure on grid operators for offsetting surplus or deficiency in generation. A multi-carrier energy system allows energy to be converted and stored using different energy carriers, thus relieving the stress from grid operators. However, these systems require efficient operation to unfold their full potential. This paper proposes a novel blockchain-enabled process to coordinate, allocate, and settle intra-day energy transactions in a district multi-carrier energy system with electricity and heating sub-networks. An incentive mechanism is designed for an optimal allocation of local green energy generation. The mechanism is implemented for the Ethereum blockchain and operates fully on-chain. The design leaves energy producers the freedom to choose their preferred pricing strategy for profit maximization while restricting them to behavior favoring the common good. We test three pricing strategies, with different levels of knowledge on users’ pricing behaviors, that energy producers may adopt. The price-availability-based allocation system guarantees consumers the lowest possible cost

Experimental bandwidth benchmarking for P2P markets in blockchain managed microgrids

As a basic building block of the smart grid, advanced metering infrastructure (AMI) is substantial for gathering and sending consumption and production data of consumers. The applications facilitated by blockchain technology like local peer to peer (P2P) markets challenge the centrally organized utility industry with its disruptive potential and rely also heavily on AMIs as data source. However, such technologies pose a number of engineering challenges in early stage pilot projects: Unlike centrally managed AMIs, local P2P markets in particular require AMIs to exchange data with their peer devices, which increases the communication requirements due to the decentral nature of blockchain networks. In this paper, we compare the bandwidth requirement of real-time AMI with the requirements for a blockchain managed peer to peer market. By benchmarking both a normal operation and a high throughput scenario we find a ten times higher demand in bandwidth of the blockchain-based solution compared to real-time AMI and select the appropriate communication technology for an upcoming field test.ISSN:1876-610

A Decentralised Sharing App running a Smart Contract on the Ethereum Blockchain

The sharing economy, the business of collectively using privately owned objects and services, has fuelled some of the fastest growing businesses of the past years. However, popular sharing platforms like Airbnb or Uber exhibit several drawbacks: a cumbersome sign up procedure, lack of participant privacy, overbearing terms and conditions, and significant fees for users. We demonstrate a Decentralised App (DAPP) for the sharing of everyday objects based on a smart contract on the Ethereum blockchain. This contract enables users to register and rent devices without involvement of a Trusted Third Party (TTP), disclosure of any personal information or prior sign up to the service. With increasing distribution of cryptocurrencies the use of smart contracts such as proposed in this paper has the potential to revolutionise the sharing economy

User behavior in a real-world peer-to-peer electricity market

Peer-to-peer (P2P) energy markets are a widely discussed approach toward a sustainable energy supply that allows private owners of distributed energy resources (e.g., solar panels) and consuming households to trade energy directly without intermediaries. P2P energy markets are expected to contribute to a green, local, and fair energy system in the future. The approach implies a paradigm shift regarding the role of citizens who evolve from passive consumers into active market participants. While first existing research primarily focused on the technical feasibility of such scenarios, end users and their role in P2P markets have received little attention. The present article studies the behavior of 35 households and two commercial entities in Switzerland's first real-world P2P energy market. In this unique real-world setting, based on a mixed methods approach, we developed and deployed a web application and empirically studied interaction, acceptance, and participation in electricity pricing in this P2P energy market, using data from system logs, surveys, and interviews. The findings are threefold. First, the P2P energy market was well received among its users, indicated by comparably high and stable usage activity of the web application throughout the study (4.5 months). Second, users in the sample are heterogeneous; based on their engagement with the web application and their stated preferences, they can be categorized into those who want to actively set prices (30%); those who prefer automated prices determined by an information system (35%); and non-users/non-respondents to surveys (35%). Third, an analysis of interviews with nine households suggests that P2P energy markets may increase the salience of renewable energies and may promote load-shifting activities. Thus, the article provides empirical insights about the user behavior of households and their future role in decentralized energy scenarios.ISSN:0306-2619ISSN:1872-911

Peer-to-Peer Energy Trading in the Real World: Market Design and Evaluation of the User Value Proposition

Electricity markets are experiencing a shift to a more decentralized structure with small distributed renewable generation sources like residential photovoltaic systems. Simultaneously, information systems have driven the development of a “sharing economy” also in the electricity sector and can enable previously passive consumers to directly trade solar electricity in local communities. However, it is unclear how such peer-to-peer (P2P) markets should be designed to create value for the user. In a framed field experiment, we design and implement Switzerland’s first real-world P2P electricity market in a local community. We examine its value proposition for the users and elicit user preferences by enabling the participants to directly influence buy and sell prices for local solar energy. The collected empirical evidence suggests that the P2P exchange is beneficial for users and provides incentives for generation of renewable energy. The results create valuable insights for the design and diffusion of future energy markets

Bidding on a Peer-to-Peer Energy Market: An Exploratory Field Study

Moving toward sustainable energy systems to address climate change is one of the key challenges of our generation. To that end, investments in renewable energy and balancing renewable supply and energy demand on the larger scale are crucial. One mechanism to create price signals for demand balancing, as well as for consumer engagement, is to establish trading platforms (or peer-to-peer (P2P) markets) through which households can directly buy and sell renewable energy. However, residential consumers are typically lay users with little or no previous exposure to the complexity and the dynamics involved in energy markets. More so, empirical research on consumer engagement in the energy sector indicates that individuals tend to act against their stated proenvironmental intentions and to lose interest in energy management systems particularly quickly—calling into question regulatory efforts to foster P2P markets to push the transition to renewable energy. We have implemented the first empirical study worldwide that analyzes bidding behavior in a real-world P2P energy market, in which users bid for solar energy via an auction mechanism. For the duration of an entire year, users could interact with the market using a web app. The prices settled on the P2P market directly impacted participants’ electricity bills. We provide unique empirical evidence showing that (1) participants were willing to engage in energy trading and that (2) they understood the market mechanism surprisingly well and exhibited learning effects. Still, bidding behavior did not reflect their stated intention of paying a price premium for local solar energy. The market outcomes reveal that P2P energy markets can indeed have a positive impact on balancing demand and supply, thereby addressing the fundamental challenge of distributed renewable energy systems.ISSN:1047-7047ISSN:1526-553