Peer-to-Peer Energy Trading in the Real World: Market Design and Evaluation of the User Value Proposition

Electricity markets are experiencing a shift to a more decentralized structure with small distributed renewable generation sources like residential photovoltaic systems. Simultaneously, information systems have driven the development of a “sharing economy” also in the electricity sector and can enable previously passive consumers to directly trade solar electricity in local communities. However, it is unclear how such peer-to-peer (P2P) markets should be designed to create value for the user. In a framed field experiment, we design and implement Switzerland’s first real-world P2P electricity market in a local community. We examine its value proposition for the users and elicit user preferences by enabling the participants to directly influence buy and sell prices for local solar energy. The collected empirical evidence suggests that the P2P exchange is beneficial for users and provides incentives for generation of renewable energy. The results create valuable insights for the design and diffusion of future energy markets.