Architectural Principals of Transactive Energy
Thursday, June 15, 2017 at 08:48AM
Toby Considine in Microgrids and Distributed Systems, Paths to Transactive Energy, Services, Smart Grid, System Architecture, Transactive Energy

This post is part of the continuing Paths to Transactive Energy series. You can find them all listed by clicking on the matching metatag at the bottom of each post.

Transactive energy describes a pattern of integration where parties exchange the value or a commodity resource [power] over time and make forward commitments to sell or purchase that commodity. The Common Transactive Services (CTS) can be used in central auction-type systems, where a single entity announces or broadcasts prices or in markets were two or more parties come to a mutual agreement on price and delivery.

All forward transactions are committed, that is one party commits to delivering the service or commodity, one commits to buying it. If a provider wishes not to deliver, or if a purchaser wishes not to take delivery, they can participate in a separate negotiation, with a separate price, that can be netted against the original committed transaction. Such a buy-back resembles today’s Demand Response.

If one purchaser wishes to acquire more power at the last minute, and one wishes to acquire less, they can negotiate an exchange on the spot market. Different market structures and market rules will change the format, but not the substance of this transaction.

The CTS are essentially identical for any commodity resource or service. CTS works for transmission rights and ancillary services, as well as for other resource markets such as transactive water or transactive thermal markets. In each case, the product is delivery of the commodity at the designated time at the designated rate.

The CTS can work in many market structures. CTS can be used with a single (for the microgrid / micromarket) brokered trading floor or with peer-to-peer transactions. Compound transactions can link multiple simple transactions, such as paired transmission and delivery. Different circumstances will work best with different market structures, but in all cases, the communications can use the CTS.

  1. Each party represents a node that acts in its own interests to support its own purposes.
  2. The internal mechanisms and systems of a node are not communicated as part of the CTS.
  3. The system of systems that make up a node may choose to organize some or part of their internal operations using transactive energy / transactive agents.
  4. Actors inside a node interact with the internal market, not the external; there is no direct market interaction with things / markets / prices external to the node.
  5. The purpose of an transactive node is to support the purposes of its owners and occupants, and not to support the things outside the node.
  6. Economic signals or availability from outside the node might influence the market, if any, inside the node, but only as the market interface on the node relays that information. This may include markups, smoothing, discounts or any other means or mechanism that the owner of the node chooses to use (or that the maker of the system that operates the node chooses to use so that the owner of the node box will choose that system).
  7. Parties external to the node should not use the possible existence of an economic entity inside the box as an excuse to penetrate the veil of the black box.

     

Article originally appeared on New Daedalus (http://www.newdaedalus.com/).
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