Virtual net-billing: A fair energy sharing method for collective self-consumption

Abstract

This paper proposes an energy sharing method for collective self-consumption called virtual net-billing. The proposed method enables the members of an energy community to fairly share energy in real-time, based on their individual contribution. To achieve this, a mathematical model is developed, which separates the total self-consumption of the community into a portion caused by behind-the-meter self-consumption and a portion caused by the energy sharing. The properties of the proposed method are explored analytically, using cooperative game theory, and through simulations of 600 hypothetical energy communities, developed using real-world data. To assess the fairness of the proposed method, a theoretical framework is developed, which consists of three mutually non-exclusive definitions and three numerical indicators. Using this framework, the method is compared to five existing energy sharing methods from the scientific literature. The results indicate that virtual net-billing provides the lowest trade-off between fairness and computation complexity compared to the existing methods, which makes it suitable for large energy communities and easy implementation in real-world settings.