Negawatt Trading in the Energy Market: Implementation Challenges and Prospects

Dear Colleagues,

In the smart grid era, consumers are becoming an integral part of the energy market. They can buy what they need, sell out their excess energy, and trade the right to buy to other proactive consumers (prosumers). “Negawatt trading” is a specific trading mechanism for trading the right to buy energy instead of any physical exchange of energy. It increases consumer choice and control and significantly reduces the barriers for consumers to participate in local energy trading. In this way, they can become “prosumers” by using negawatts to replace the megawatt as an equivalence of production. It is a good way for consumers who cannot afford solar or batteries to contribute to, and benefit from, a more transactive grid. The cost and other contextual barriers to participation are far lower, in principle, than having to install solar or batteries, but they can still receive comparatively significant benefits (e.g., in the form of reduced energy costs). We see this as being very important for achieving energy equity in the distributed energy future. Implementing negawatt provides flexibility and freedom to choose the right time for demand minimization, selling price, and trading of the right to buy energy with others. This paradigm provides more control to the prosumers in energy trading. Prosumers can trade with either the grid or other prosumers in the network using a peer-to-peer interface. As a result, prosumers can participate in negawatt trading and reap their expected rewards through flexible control of the energy market. This simple revenue stream drives energy market players’ focus towards saving electricity, innovative business techniques for identifying the most cost-effective solutions to reduce electricity use.

In this Special Issue, the challenges and potential of establishing negawatt trading mechanisms in today’s energy market will be addressed. The exploration of  recent technological advances (e.g., artificial intelligence, distributed ledger, grid-interactive buildings, 5G technologies in the efficient deployability of negawatt trading). We aim to provide a multidisciplinary view of the possibility of negawatt trading in energy markets, which will eventually help to improve smart grids’ energy efficiency.

Topics covered include but are not limited to the following. 1. Prosumer-focused energy management: a) grid-interactive efficient buildings; b) social motivations for negawatt sharing between prosumers; c) secure information exchange and monetary transactions; d) fair pricing mechanisms; e) specialized marketplace for peer-to-peer negawatt sharing; f) social media platforms; g) behavioral economics; h) uniform frameworks for trading both watts and negawatts. 2. Effect of technological advancements: a) distributed ledger technology (DLT); b) blockchains; c) high-speed communication (5G); d) Internet of Things (IoT); e) artificial intelligence (AI); f) distributed energy sources; g) game theory; h) double auction.

Prof. Dr. Vijayakumar Varadarajan
Prof. Dr. Kapil Sharma
Prof. Dr. Mukhtiar Singh
Guest Editors

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