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Regulatory Options for Local Reserve Energy Markets: Implications for Prosumers, Utilities, and other Stakeholders

While the share of fluctuating renewable energy resources is constantly increasing, the centralized, hierarchical organization of the current energy system and markets cannot adequately accommodate such decentralized electricity generation. New ideas have been developed and discussed for improved integration, also in Germany, one of the lead markets. Examples in this context are virtual power plants and microgrids. This paper presents a new local reserve energy market design (applied to residential households), which can facilitate the operation and allow trading within these constructs. Emphasis is put on the regulatory options and current market framework, mainly from a European and a German perspective, which serve as a basis for implementing the local market. It can be shown that using existing regulatory structures, a local market with simple rules (comparable to an "energy-eBay") can be easily installed.

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JEL Codes: Q40: Energy: General, Q41: Energy: Demand and Supply; Prices

Keywords: local reserve energy market, balance group, prosumer

DOI: 10.5547/01956574.37.SI2.cros

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Published in Volume 37, Bollino-Madlener Special Issue of the bi-monthly journal of the IAEE's Energy Economics Education Foundation.


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