Exploring Energy Trading Markets in Smart Grid and Microgrid Systems and Their Implications for Sustainability in Smart Cities

Filipe Bandeiras, Álvaro Gomes, Mário Gomes and Paulo Coelho ()
Additional contact information
Filipe Bandeiras: Smart Cities Research Center (Ci2-IPT), 2300-313 Tomar, Portugal
Álvaro Gomes: Institute for Systems Engineering and Computers at Coimbra (INESC Coimbra), 3030-290 Coimbra, Portugal
Mário Gomes: Smart Cities Research Center (Ci2-IPT), 2300-313 Tomar, Portugal
Paulo Coelho: Smart Cities Research Center (Ci2-IPT), 2300-313 Tomar, Portugal

Energies, 2023, vol. 16, issue 2, 1-41

Abstract: Smart cities are aimed at connecting urban infrastructures to enhance the efficiency of their operation and services while taking sustainability goals into consideration. As a result of the intermittency associated with renewable generation, smart city systems such as smart grids and microgrids may not be able to ensure the security of supply. This can be mitigated by allowing these systems to trade surplus energy with other neighboring systems through local energy markets based on peer-to-peer schemes. Such an approach can play an important role on achieving sustainability due to the positive impacts at the economic, social, and environmental level. Therefore, this work explores the design of local energy markets to help determine how they are relevant to smart grid and microgrid applications and what their contributions are to sustainability in smart cities. Essentially, this is achieved by performing a literature review to address key characteristics related to the design of local energy markets while considering their relationship with urban sustainability. In addition, the concept of game theory and its potential to evaluate market designs are also introduced and discussed. Finally, the suitability of centralized, decentralized, and distributed market designs for each dimension of sustainability is estimated based on their design characteristics.

Keywords: local energy market; peer-to-peer energy trading; smart city; smart grid; microgrid; urban sustainability; game theory (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.mdpi.com/1996-1073/16/2/801/pdf (application/pdf)
https://www.mdpi.com/1996-1073/16/2/801/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jeners:v:16:y:2023:i:2:p:801-:d:1031092

Access Statistics for this article

Energies is currently edited by Ms. Agatha Cao

More articles in Energies from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().