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How will local energy markets influence the pan-European day-ahead market and transmission systems? A case study for local markets in France and Germany

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  • Schmitt, Carlo
  • Schumann, Klemens
  • Kollenda, Katharina
  • Blank, Andreas
  • Rebenaque, Olivier
  • Dronne, Théo
  • Martin, Arnault
  • Vassilopoulos, Philippe
  • Roques, Fabien
  • Moser, Albert

Abstract

The energy system decarbonization leads to a decentralization of generation and flexibility. Among the new concepts to integrate distributed flexibility are local energy markets. While a broad range of research investigates local energy markets on a distribution grid level in detail, research on their system impact has been limited. Therefore, we develop a framework to investigate different configurations of local markets as well as the operation of distributed energy resources and their interaction with the wholesale markets. This framework is applied to a pan-European case study with detailed bottom-up modeling of local energy markets in France and Germany. Additionally, transmission grid simulations are carried out to investigate the impact of local trading on grid congestions. Our results show that a direct coordination of distributed flexibility within the wholesale market is more efficient than a preference for local trading. Nonetheless, local energy markets can be used as an incentive for the expansion of distributed flexibility as well as a way to break down the complexity of coordinating millions of distributed assets in a single market. Additionally, our results show that local trading relieves the transmission grid.

Suggested Citation

  • Schmitt, Carlo & Schumann, Klemens & Kollenda, Katharina & Blank, Andreas & Rebenaque, Olivier & Dronne, Théo & Martin, Arnault & Vassilopoulos, Philippe & Roques, Fabien & Moser, Albert, 2022. "How will local energy markets influence the pan-European day-ahead market and transmission systems? A case study for local markets in France and Germany," Applied Energy, Elsevier, vol. 325(C).
    • Handle: RePEc:eee:appene:v:325:y:2022:i:c:s0306261922011710
    DOI: 10.1016/j.apenergy.2022.119913
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    1. Younes Zahraoui & Tarmo Korõtko & Argo Rosin & Hannes Agabus, 2023. "Market Mechanisms and Trading in Microgrid Local Electricity Markets: A Comprehensive Review," Energies, MDPI, vol. 16(5), pages 1-52, February.

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