Multi Agent-based Distributed Energy Arbitrage in Residential Distribution System

The energy arbitrage in residential microgrid system gained attention in recent years and the idea is to efficiently utilize the small scale distributed energy resources. Although the peer-to-peer (P2P) business framework is widely considered in such distribution systems, the conventional P2P model may become inefficient when the supply-to-demand ratio is very high or low in the system, which could increase the system operational cost. Moreover, it is more challenging to accommodate a large number of prosumers in a P2P market due to communication and computation burden. Considering these issues, this paper proposes a regionally-expanded P2P energy trading system in a hierarchical structure. In this approach, a large system can be divided into small sub-systems that can participate in the energy arbitrage effectively. The proposed energy arbitrage model was applied in residential microgrids consist of smart solar homes, namely nanogrids, to verify the effectiveness. Results showed that the proposed approach can provide more financial benefits to the consumers by reducing the operational cost.