Assessing the techno-economic benefits of LEMs for different grid topologies and prosumer shares

Abstract

The shift towards decentralized and renewable energy sources has introduced significant challenges to traditional power systems, necessitating innovative market designs. Local energy markets present a viable solution for integrating distributed energy resources such as photovoltaic systems, electric vehicles, and heat pumps within various grid topologies. This study investigates the techno-economic benefits of local energy markets compared to conventional market designs, focusing on their impact on average energy prices and operational peak power, using a self-developed agent-based energy system simulation tool. Through comprehensive simulations across the countryside, rural, suburban, and urban grid topologies with varying penetration levels of the distributed energy resources, totaling 400 simulation setups, we demonstrate that local energy markets can enhance economic efficiency and grid stability with 99 % of the scenarios boasting lower average energy prices and 80 % lower operational peak power levels. Our findings suggest that local energy markets can play a role in the future energy system, especially in areas with high shares of PV and HP, provided that additional infrastructure, management costs, and bureaucratic complexity are kept to a minimum.

Figures (9)

• Figure 1: What economic and technical effect do local energy markets have on the energy system? To answer this question, we ran 400 different simulations with varying levels of PV, electric vehicles, heat pumps, and different grid topologies. Using our own agent-based simulation tool we ran the simulations with and without a local energy market. The results show that local energy markets can reduce economic and technical burdens in 99 and 80 %, respectively. Nevertheless, they cannot be introduced without any safeguarding measures as operation within technical constraints cannot be guaranteed by these types of markets alone.
• Figure 2: Methodology for the creation of the scenarios to be examined
• Figure 3: Comparison of the average energy price and operational peak power ratio for scenarios with and without LEMs for every combination of PV, EV and HP
• Figure 4: Comparison of the absolute energy prices for scenarios with and without LEMs for every combination of PV, EV and HP
• Figure 5: Comparison of the operational peak power values for scenarios with and without LEMs for every combination of PV, EV and HP