Peer-to-Peer Energy Storage Capacity Sharing for Renewables: A Marginal Pricing-Based Flexibility Market for Distribution Networks

The distributed renewable energy sources have been rapidly increasing in distribution networks, and some of them are configured with energy storage devices. Indeed, sharing surplus energy storage capacities for subsidizing the investment costs is economically attractive. Although such willingness is emerging, targeted trading mechanisms are less explored. Inspired by the electricity markets, this paper innovates a peer-to-peer energy storage flexibility market within distribution networks, which involves multiple vendors and customers, accompanied by a marginal pricing mechanism to enable the economic reallocation of surplus energy storage capacities in distribution systems. A small-scale market is first studied to show the proposed market mechanism and a larger-scale case is used to further demonstrate the scalability and effectiveness of the mechanism. Case studies set three distinct scenarios: markets with or without deficits and with carryover energy constraints. The numerical simulation validates its ability in reflecting the capacity supply–demand relationship, ensuring revenue adequacy and effectively improving economic efficiency.