Coordinated Clearing of Transmission and Distribution Electricity Markets Based on Transaction Feasible Regions

The growing deployment of distributed energy resources on the demand side has increased the influence of distribution network power flows on transmission system operation. Although transmission and distribution networks are physically interconnected, effective mechanisms for coordinating their electricity markets remain limited. This paper proposes a coordinated transmission-distribution market clearing method based on transaction feasible regions (TFRs). First, a prosumer TFR is constructed using equivalent projection (EP) theory and approximated by a polytope using progressive vertex enumeration (PVE). This procedure projects individual trading strategies, including equipment constraints and decision preferences, onto a space of market coupling variables comprising power, price, and cost. Next, EP is applied to construct a distribution market TFR that incorporates internal power flow and network topology constraints, thereby providing an aggregated representation of the distribution market's trading decision space and operational security boundaries. Finally, a multilevel interaction framework comprising feasible-region projection, centralized market clearing, and operating schedule determination is developed for the day-ahead market to coordinate transmission and distribution market clearing. Case studies show that a distribution market TFR incorporating distribution network security constraints and prosumer trading constraints can be represented in a reduced-dimensional space by approximately 100-1000 linear inequalities in the trading variables.