Power Pool vs P2P Energy Trading Mechanisms: A Social Welfare Perspective

This paper presents a comparative study of Power Pool and Peer-to-Peer (P2P) energy trading mechanisms from a social welfare perspective. Focusing on the evolving landscape of energy trading, particularly amidst the integration of renewable energy sources, this study utilizes linear programming and a multi-stage matching mechanism (MMM) to analyze and compare these two models. Our findings reveal that while the P2P model facilitates a greater volume of energy transactions, the Power Pool model achieves higher social welfare. This contrast highlights the distinct strengths and weaknesses of each market mechanism. The research underscores the importance of developing criteria for an efficient comparison between the two models and contemplates the inclusion of additional variables like carbon credits and the impact of geographical proximity on renewable energy trading. The study contributes to a deeper understanding of these trading mechanisms, providing insights crucial for shaping future energy markets.