A New Model for Matching Asks and Bids in P2P Energy Trading: Game Theory Method

Abstract

Peer-to-Peer (P2P) energy trading is one of the emerging approaches for managing energy within microgrids. Various methods and mechanisms have been proposed for market settlement in P2P energy trading. One of the challenges in these approaches is the underutilization of the maximum capacity of the P2P energy market. In this article, to maximize the utilization of the P2P market capacity and address the buying and selling requests, a combination of auction-based and bilateral negotiation approaches has been utilized. One of the advantages of double auction-based approaches is the ability to maximize social welfare due to the presence of an auctioneer in their structure. On the other hand, one of the challenges of these approaches is that some buyers and sellers may exit the market clearing process based on their own bids and asks. As a result, they would need to find alternative ways to sell and buy their energy. In the proposed approach, buyers and sellers are divided into two groups. The first group consists of participants who have won in the auction process. In this scenario, buyers engage in a Stackelberg game with the P2P energy trading platform, which acts as the auctioneer. In this game, the auctioneer plays the role of the leader, and the buyers play the role of followers. Each of them strives to maximize their social welfare function. After the completion of the market settlement process for the first group, the buyers and sellers of the second group attempt to match their contracts with each other through bilateral negotiations. Another challenge in P2P energy trading is the lack of simultaneous consideration of both economic (market settlement) and technical aspects (network constraints). In the proposed mechanism, constraints and network topology are also considered in the transactions process to minimize the possibility of overload and line congestion. The proposed mechanism has been implemented on the IEEE 37-feeder test system, and the results show that the proposed mechanism performs significantly better than other existing methods.

Keywords:

• peer-to-peer (P2P)
• local energy trading
• auction method
• Stackelberg game
• bilateral negotiation
• social welfare

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Ali Izanlo

Ali Izanlo was born in Shirvan, Iran, in 1990. He received his BSc degree in electrical engineering from Birjand University, Birjand, Iran in 2009. He received his MSc degree from Noshivani University of Technology in Mazandaran, Iran. His current research interests include variable and adjustable speed power generation with permanent magnet and doubly fed induction generators, automotive power electronics and drives, current measurement systems for power electronics, smart grids, and renewable energy.

Abdolreza Sheikholeslami

Abdolreza Sheikholeslami was born in Iran. He received the B.Sc. (Hons.) degree in electrical engineering from Mazandaran University, Babolsar, Iran, in 1979, and the M.Sc. and Ph.D. degrees in electrical power engineering from the University of Strathclyde, Glasgow, U.K., in 1978 and 1989, respectively. He has been an Associate Professor with the Department of Electrical and Computer Engineering, Babol Noshirvani University of Technology, Babol, Iran, since 2009. His current research interests include power electronic, power quality, harmonics, smart grids, and renewable energy.

S. Asghar Gholamian

S. Asghar Gholamian was born in Babolsar, Iran, in 1976. He received the B.Sc. degree in electrical engineering from K. N. Toosi University of Technology, Tehran, Iran, in 1999, the M.Sc. degree in electric power engineering (electrical machines) from the University of Mazandaran, Babol, Iran, in 2001, and the Ph.D. degree in electrical engineering from K. N. Toosi University of Technology in 2009. He is currently an Associate Professor with the Department of Electrical Engineering, Babol Noshirvani University of Technology, Babol, Iran. His research interests include design, simulation, and modeling of electrical machines.

Mohammad verij Kazemi

Mohammad verij Kazemi was born in Nowshahr, Iran, in 1983. He received the B.Sc. degree in electrical engineering from Gilan University, Gilan, Iran, in 2006, and the M.Sc. degree in electrical engineering from Sahand University of Technology, Tabriz, Iran, in 2008, and the Ph.D. degree in electrical engineering from Babol Noshirvani University of Technology, Mazandaran, Iran, in 2020. He is currently working with the University and with West Mazandaran Distribution Electrical Company. His research interests include renewable energy conversion, smart grid, data-driven, and evolutionary optimization algorithms.

S. Naghi Hosseini

S. Naghi Hosseini was born in Babol, Iran, in 1983. He received the Ph.D. degree in electrical engineering from Babol Noshirvani University of Technology, Mazandaran, Iran, in 2021. He is currently working with the University. His research interests include renewable energy conversion, smart grid, data-driven, and harmonics, smart grids, and renewable energy.