Transactive energy systems: what has communications got to do with it?

The smart grid vision is unveiling new possibilities in the ways utilities and consumers interact with energy; transactive energy (TE) being one of them. In TE system, economic and control mechanisms are combined in such a way as to allow dynamic balance of supply and demand across the entire electrical infrastructure using value as a key operational parameter. The central theme of TE is that by actively engaging prosumers and exploiting their roles in the energy value chain the grid can become more flexible; this adds economic and social dimensions to the grid operations. Although TE is currently at nascent stage, its development and delivery are being shaped by the emergence of distributed energy management techniques such as Virtual Power Plant (VPP) and Peer-2-Peer (P2P) energy trading. In these systems, rather than the vertical hierarchical flow of electricity found in traditional grid, the TE element also allows market-driven horizontal interactions between energy producers and consumers.

In this talk, the various challenges that the industry stakeholders must confront in a bid to maintain technical, social and economic equilibrium in the TE sector will be discussed. This includes definition of TE scenarios and reference design, development of common platform model and the requisite regulatory framework to accommodate TE services in the grid. These challenges are not trivial, adequately addressing them will inspire new economic processes and business models that not only rewards prosumers but also protects the utilities from abrupt or unexpected contingencies. For the market makers, one of the key questions is to determine how VPP and P2P create new opportunities for TE. Overlaying the TE services over the power network suggests that ICT-driven trading platform must be available to provide the needed interface between energy buyers and potential sellers within the network. Therefore, in order to maximize the benefits of TE to the operators and prosumers, communication network design paradigms must be developed to support the transactive exchanges between producers and consumers. A rethinking of existing ICT infrastructure and technologies with a view to retrofitting them for TE is be presented.