As energy prices rise nationwide, Washington State University researchers have developed and tested a local electricity trading approach that could someday help communities save money and improve grid reliability.
In collaboration with Avista Utilities and its Energy Innovation Lab, WSU researchers simulated an electricity trading system for solar and battery storage shared within a neighborhood. Over five days, the proof-of-concept work showed potential energy cost savings of about 12% for that area. The findings are published in the IEEE Transactions on Industry Applications.
“The changing landscape of the electricity industry necessitates practical solutions for coordinated operation at the distribution level,” said John Theisen, lead author on the paper and a PhD candidate in the School of Electrical Engineering and Computer Science. “If you can coordinate and move electricity around in a way that is optimal, you can increase efficiency, offer better utilization, and save a lot of money for the people operating the assets, the utility companies, and for the consumers. This is the application of what everyone’s been talking about.”
The energy grid is no longer just a centralized system. Power increasingly comes from many distributed sources, like rooftop solar panels or small community wind and solar projects. Electricity demand is growing, and building new transmission lines can take years. Coordinating resources locally could make the grid more efficient and reduce costs over time.
WSU researchers have developed a system that creates a way to trade and share energy of assets — like solar panels and batteries — at the local distribution level.
At the large-scale transmission level, utilities have traded electricity for decades. Power grid operators buy when prices are low and sell when they have surplus. Prices and trading activity fluctuate throughout the day and year. At the local distribution level, electricity is reduced to safe, usable voltages and moved to homes and businesses.
The WSU system creates a way to trade and share energy of these assets — like solar panels and batteries — at the local distribution level. For example, a hospital or university might have a battery sitting idle onsite, intended to provide back-up energy in an emergency. This research explores how those assets could be used to optimize electricity trading locally, similar to trading at the transmission level.
“When you can utilize an underutilized asset, you can gain a lot more value from it,” said Theisen.
The test used battery assets and electricity feeders in Spokane’s Catalyst Building and South Landing Eco-District. The researchers developed a cloud-based system that analyzed energy prices and solar forecasts, allowing asset owners to trade energy locally or use the larger grid. The test project represented one section of a distribution feeder, or about one-eighth of the region’s substation.
The researchers were able to implement responsiveness, allowing the asset owners to respond to changes in the price of energy through the day.
“It was pretty seamless,” said Theisen.
Under the chosen conditions over a five-day period, the simulations demonstrated potential savings valued at about $1,000 for the selected assets.
“If those kinds of assets existed everywhere in the distribution system at that level of participation, you can save hundreds of thousands of dollars a year on costs,” he said.
Avista supported the study. While current energy prices reflect infrastructure upgrades and clean energy requirements, projects like this aim to offset future costs and improve efficiency. Savings from smarter systems could help utilities reinvest in grid improvements and resilience.
“Everyone’s worried that the price of electricity is rising, and it will,” said Theisen. “The only way you can get around that is by being more energy efficient and to figure out these smarter ways to coordinate electricity.”
