A market-based integrated framework to allocate low-voltage network capacity for voltage and congestion management

The integration of distributed energy resources (DERs) such as electric vehicles poses an important risk to low-voltage (LV) networks, including voltage drops, spikes, and congestion. Effective use of DER flexibility is essential to mitigate these network issues. This paper proposes a local capacity market (LCM) operating alongside a flexibility market, designed to allocate available network capacity ahead of operation. This framework enables network users to proactively trade capacity rights ahead of operation, receiving power caps that reflect local constraints. We explore four market clearing mechanisms for capacity allocation, which go beyond traditional price-based methods. We evaluate these algorithms on a real LV network model over a single day under varying network constraints and priority rules for network capacity allocation, aiming to investigate the fairness of each clearing algorithm. Our simulations demonstrate that clearing algorithms incorporating both congestion and voltage constraints outperform the copperplate model – commonly used in wholesale electricity markets – in effectively managing voltage and congestion. While different rules can enhance the fairness of the clearing algorithm, they ultimately affect the overall DER power profile. • Introduce a novel LV network capacity market to manage congestion and voltage. • Evaluate alternative allocation methods to enhance fairness and network utilisation. • Model transformer and feeder capacity pricing using power flow-based constraints. • Demonstrate the effectiveness of the framework using real low-voltage network data.