Energy Management and Peer-to-peer Trading in Future Smart Grids: A Distributed Game-Theoretic Approach

We consider the economic dispatch problem for a day-ahead, peer-to-peer (P2P) electricity market of prosumers (i.e., energy consumers who can also produce electricity) in a distribution network. In our model, each prosumer has the capability of producing power through its dispatchable or non-dispatchable generation units and/or has a storage energy unit. Furthermore, we consider a hybrid main grid & P2P market in which each prosumer can trade power both with the main grid and with (some of) the other prosumers. First, we cast the economic dispatch problem as a noncooperative game with coupling constraints. Then, we design a fully-scalable algorithm to steer the system to a generalized Nash equilibrium (GNE). Finally, we show through numerical studies that the proposed methodology has the potential to ensure safe and efficient operation of the power grid.