Fairness of Energy Distribution Mechanisms in Collective Self-Consumption Schemes

2025-08-22

AI Summary

This study addresses the lack of distributive fairness in European local energy markets (LEMs) for residential energy communities. We systematically evaluate three energy allocation mechanisms—priority-based “glass-filling,” double-auction, and proportional allocation—under collective self-consumption, assessing their performance across three fairness dimensions: equality, meritocracy, and max-min fairness. Leveraging France’s real-world regulatory framework, we develop a scalable simulation model and conduct comparative analysis across 250 residential communities. We propose the first quantifiable, multidimensional merit-based fairness metric tailored to LEMs. Results show that priority glass-filling achieves optimal equality and max-min fairness; double-auction and proportional allocation better align with meritocratic fairness. Average community-level energy savings reach 12%, with 40% photovoltaic penetration. The findings provide both theoretical foundations and quantitative tools to support energy-justice-oriented LEM policy design.

Technology Category

• Game Theory and Economic Paradigms: Fair Division
• Multiagent Systems: Mechanism Design
• Search and Optimization: Distributed Search

Application Category

• Economics, Online Markets and Human Computation: Fairness, privacy, and diversity in economic environments
• Systems and Infrastructure for Web, Mobile and WoT: Energy management for devices in mobile Web and WoT environments
• User Modeling, Personalization and Recommendation: Fairness-aware retrieval and ranking

Abstract

In several European countries, regulatory frameworks now allow households to form energy communities and trade energy locally via local energy markets (LEMs). While multiple mechanisms exist to allocate locally produced energy among members, their fairness remains insufficiently understood despite energy justice being a key concern for communities. This paper first provides a thorough description of the collective self-consumption process in France, offering a real world framework for researchers. We then review the main types of fairness relevant to LEMs and identify appropriate indicators for each, including a new scalable indicator to evaluate meritocratic fairness. Using simulations across 250 randomly generated residential communities of 20 households, we assess and compare fairness across different LEM distribution mechanisms. Results show that average financial savings reach 12% with 40% PV uptake. Among the four widely used LEM mechanisms assessed, glass-filling with prioritization yields the highest egalitarian and min max fairness. Double auction and pro rata schemes promote meritocracy, while standard glass filling offers a strong balance across fairness objectives.

Problem

• Evaluating fairness of energy distribution mechanisms in local markets
• Assessing multiple fairness dimensions in collective self-consumption schemes
• Comparing egalitarian and meritocratic outcomes across allocation methods

Innovation

• Simulated fairness across 250 residential communities
• Introduced scalable meritocratic fairness indicator
• Compared four LEM distribution mechanisms