Day-ahead micro-market design for distributed energy resources

This paper defines a day-ahead micro-market structure and illustrates its capability of increasing distributed energy resources' integration. This micro-market mimics in the distribution level the structure of the current European day-ahead markets and their rules to introduce competition, and is based on the social welfare indicator. Micro-markets could overcome two major challenges of pool markets: they could consider the distribution network to ensure feasibility of the matched configurations and they could handle a high penetration of renewable energy without generation costs. A micro-market is controlled and supervised by the micro-market operator who executes the auction algorithm. This paper exposes a state-of-the-art about micro-markets, proposes a structure and a set of rules, and shows micro-market's behaviour in a case study. The results show that with under-sized distribution networks the micro-market can effectively improve the social welfare with respect to other simpler approaches.