An Equilibrium Approach Assessing Tariff Designs for Local Energy Markets in the Context of Active Consumers

As consumers go from passive to active, it is necessary to consider if the price signals from the grid are enough to promote optimal utilization of the decentralized resources in the context of the larger power system. The research
considers tariff design options in the context of active consumers that can
participate in both local and centralized electricity markets. The interaction between a neighborhood with the possibility of a local market and the grid is modeled as a complementarity problem. The results provide insight into the appropriateness of different tariff design structures and an assessment of the impact of a local market on the deployment and operation of decentralized resources.