Applying lessons learned from transmission open access to distribution and grid-edge Transactive Energy systems

With increasing penetration of distributed energy resources, emergence of smart end-use devices, and enhancements in communication and control technologies, the grid-edge devices and prosumers (i.e., consumers with local means of generating electricity, such as roof-top solar) are finding their place as “transactive” agents in the electric energy arena. As the Transactive Energy (TE) paradigm at the retail/distribution level is taking shape to accommodate these new market participants, there are a number of parallels that can be drawn between the de-regulation of the wholesale/transmission sector in the mid-1990s and the opening up of the distribution grid to accommodate these new participants. This paper will discuss the similarities and differences between the bulk power/wholesale market systems and the retail TE systems involving distribution grid and grid edge intelligent devices as well as end-use consumers and prosumers. It will identify some of the tools and methods developed for wholesale transactive exchanges that, with some modification, can be applied in the emerging distribution and grid-edge transactive operations. The paper will also point out the gaps and possible solutions to address the potentially much higher dimensionality of grid-edge transactions, and idiosyncrasies of the distribution system compared to bulk power system operation and wholesale markets. Illustrative examples will be presented to substantiate the issues and to demonstrate the potential solutions.