Virtual power consumption rights trading mechanism for multiple prosumers in distribution systems

Demand response is an effective way to address electricity supply shortages. However, traditional incentive-based and price-based demand response mechanisms have drawbacks of sacrificing user autonomy and lacking control precision, respectively. Therefore, China is currently exploring a new mechanism based on virtual electricity rights trading. This paper introduces a novel virtual power consumption rights trading mechanism designed for multiple prosumers to ensure the economic operation of distribution systems under conditions of insufficient power supply. The proposed mechanism coordinates power consumption rights among prosumers, allocating these rights to those with a higher willingness to consume electricity, thus maintaining an economical state for the distribution system during power shortages. Simulation results show that, using the proposed mechanism, allowing power consumption rights trading significantly increases the net profit of each prosumer and reduces load reduction losses for high-loss prosumers compared to cases where trading is not allowed. This verifies the effectiveness of the proposed mechanism.