A Decentralized Market Design to Increase Transaction Quantity Serving Diverse Future Energy Products

This paper proposes a decentralized market arrangement that better reflects the cost of diverse energy resources and the flexibility of demand, thus able to offer a wide range of energy products. It contrasts to the centralized market that tends to represent the characteristics of the supply and demand of the entire system, but typically demand has very little price elasticity. The performances of the traditional market designs and the proposed decentralized market are compared from the perspective of market economy and system reliability under three different scenarios: i) The same market clearing prices and quantities ii) Complete market participant satisfaction iii) Growth in clearing quantity and reduction in clearing price. This paper contributes in three areas: i) An efficiency assessment by splitting the market into a number of segments in the single centralized market ii) The ability of the proposed market to promote demand flexibility iii) Market drive for more energy products to suit diverse requirements.