A novel pricing scheme for virtual communities towards energy Efficiency

A major challenge in an open and competitive electricity market that exploits renewable energy sources is the alignment between the variable rate energy production and the ad hoc energy consumption of the end users. In this context, there is a need for modern pricing schemes that will be able to effectively incentivize willing users towards modifying their energy consumption pattern based on current conditions. Existing pricing schemes treat all users the same, thus mitigating the behavioral change dynamics. To address this deficiency, we propose a Community Real Time Pricing (C-RTP) model, where users form communities and are charged according to the energy behavior of their entire community. The proposed C-RTP system is compared against the most widely accepted model in the literature, the RTP pricing model, and is shown to achieve lower energy cost (10%-15%) without sacrificing the end users' welfare or the profits of the energy service provider.