Unlock Energy Savings: How Community Microgrids are Revolutionizing Home Power
"Discover how operating-envelopes-aware decentralized welfare maximization is transforming energy communities and empowering homeowners to save."
The push for electrical grid decarbonization has led to an increase in behind-the-meter (BTM) distributed energy resources (DER). Many homeowners are still unable to install BTM DER due to physical, financial, and jurisdictional challenges. Energy communities provide a solution by allowing spatially co-located customers to pool and aggregate their resources, performing energy and monetary transactions as a single entity.
Net energy metering (NEM) policies have become increasingly popular, measuring a community's net consumption and assigning a buy (retail) rate for net-importing and a sell (export) rate for net-exporting. NEM aggregation (NEMA) and virtual NEM (VNEM) programs are playing a key role in the growth of energy communities.
Uncoordinated DER imports and exports can strain distribution networks. Dynamic operating envelopes (OEs) imposed by distribution system operators (DSO) offer a solution, providing greater flexibility than fixed export limits. This work proposes a network-aware energy community market mechanism that maximizes global welfare through operating-envelopes-aware, resource-aware, and threshold-based pricing and payment.
How Operating Envelopes Optimize Community Microgrids
The proposed market mechanism incorporates DSO-imposed OEs at the end-user level to ensure network-aware operation, guaranteeing surplus levels to members higher than standalone setups. It also achieves welfare optimality and satisfies the generalized cost-causation principle.
- Network Awareness: DSO-imposed OEs are incorporated at the end-user level, ensuring that the community's operation is network-aware.
- Surplus Guarantees: Surplus levels are guaranteed to members, exceeding what they could attain under standalone settings.
- Welfare Optimality: The system achieves welfare optimality through decentralized optimization.
- Cost Causation: The generalized cost-causation principle is satisfied, ensuring fair distribution of costs and benefits.
The Future of Community Microgrids
This research proposes an OEs-aware market mechanism for energy communities, integrating DSO's dynamic OEs into its pricing structure. This encourages collective member response, achieving maximum global welfare and making community membership advantageous. The mechanism employs a uniform, dynamic price announced based on aggregate generation-storage resources. The OEs-aware mechanism aligns with the generalized cost-causation principle, ensuring just and fair cost allocations.