Transactive Energy: Stabilizing Oscillations in Integrated Wholesale-Retail Energy Markets

Transactive energy is a control technique that uses market mechanisms to achieve desired control objectives. A number of studies have identified a well-known economic theory effect called a “cobweb” that can occur when the transactive control system is not properly designed. This work proposes a control framework to mitigate this effect by adding an extra control layer. This proposed control layer expresses the flexibility of load on the distribution side into the transmission system. By using FNCS, a co-simulation platform, new control framework is evaluated on a power system model composed of a single transmission system with the potential of thousands of flexible distribution systems. The co-simulation is able to replicate the cobweb effect and demonstrate that improper transactive control design can create oscillations at high penetrations of price-responsive loads. Furthermore, the proposed transactive control system is shown to be able to eliminate the cobweb effect while also effectively diminishing price and load spikes.