Impact of the Designed Electricity Trading Price Function using Cournot Model on the Cost Benefit Analysis in Local Market inside a Microgrid

The present work is an attempt to propose a design methodology for the electricity sharing management (ESM) in local market (LM) inside a microgrid. Prosumers with solar photovoltaic (PV) installations participate in LM in which the central entity is a local market operator (LMO). Each PV prosumer in LM plays the role of either a buyer or a seller of electricity at a particular time slot depending upon the circumstances and own electricity profile (EP). The ESM is introduced in this work with the consideration that LMO owns a solar PV plant. Unlike the EP based traditional pricing schemes, present work proposes the design for 2-dimensional (2-D) electricity trading price function (ETPF) in LM. The ETPF, in present work, not only considers the EP of LMO at a particular time slot but also acquaints with a preference parameter in pricing schemes to improve profit margin of LMO. Two different situations are taken care of in this work. The ETPF in Situation 1 and 2 are designed with the assumption that players in LM are limited to the seller role prosumers and the buyer role prosumers, respectively. Equilibrium solutions for the aforesaid situations in LM have been derived using Cournot model. A comparative study has been carried out to accentuate the benefits achieved by LMO in terms of profit improvement using the designed 2-D ETPF over its 1-D counterpart. A comparative study on the cost benefit analysis with the designed ETPF in aforesaid situations has also been presented in this work.