Abstract
The increasing adoption of distributed energy resources (DERs) and smart grid technologies (SGTs) by end-user retail customers is changing significantly both technical and economic operations in the distribution grid. The next-generation retail electricity market will promote decentralization, efficiency, and competitiveness by accommodating existing and new agents through new business models and transactive approaches in an advanced metering infrastructure (AMI). However, these changes will bring several technical challenges to be addressed in transmission and distribution systems. Considerable activities have been carried out worldwide to study the impacts of integrating DERs into the grid and in the wholesale electricity market. However, the big vision and framework of the next-generation retail market in the context of DERs is still unclear. This paper aims to present a brief review of the present retail electricity market, some recent developments, and a comprehensive vision of the next-generation retail electricity market by describing its expected characteristics, challenges, needs, and future research topics to be addressed. A framework of integrating retail and wholesale electricity markets is also presented and discussed. The proposed vision and framework particularly highlight the necessity of new business models and regulatory initiatives to establish decentralized markets for DERs at the retail level as well as advances in technology and infrastructure necessary to allow the widespread use of DERs in active and effective ways.
Highlights
The traditional way of generating, transmitting, and distributing electricity has been changing significantly as generating units become more distributed, efficient, and closer to consumption centers
Working in the distribution grid operations, distribution system operator (DSO) will be responsible for maintaining the safety and reliability of the distribution system through efficient protection and control mechanisms, coordinating ancillary services provided by distributed energy resources (DERs) agents, planning the distribution system expansion, and islanding their territory partially or totally when black-start capacity from DERs is available in the event of a transmission system disturbance [58,113]
Working in the distribution grid operations, DSOs will be responsible for maintaining the safety and reliability of the distribution system through efficient protection and control mechanisms, coordinating ancillary services provided by DER agents, planning the distribution system expansion, and islanding their territory partially or totally when blackstart capacity from DERs is available in the event of a transmission system disturbance
Summary
The traditional way of generating, transmitting, and distributing electricity has been changing significantly as generating units become more distributed, efficient, and closer to consumption centers. The increasing adoption of DERs and SGTs in the distribution grid has led researchers, policy-makers, and other stakeholders to define the concept of transactive energy as a reliable, affordable, and sustainable system that promotes the dynamic balance of supply and demand and maximizes the social welfare of all its agents [13] Under this environment, all decisions have economic and/or engineering “values,” such as profit or performance, as key operational parameters [14]. With the increasing penetration and participation of electricity market, some recent developments on transactive energy, a comprehensive vision of the DER agents in the distribution grid, what are the expected technical and economic characteristics, next-generation retail electricity market, a framework of integrating retail and wholesale markets, and challenges, and needs of the next-generation retail electricity markets?.
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