Dual-consensus federated electricity market coordination for privacy-preserving and democratisation-aware trading across interconnected energy communities

Interconnected energy communities require market designs that retain economic efficiency while addressing emerging needs for privacy, autonomy, and market-level democratisation. This paper proposes democratisation-aware federated multi-community electricity market (DF-MCEM) architectures for coordinating local, inter-community, and grid exchanges across heterogeneous community compositions and market designs. To operationalise objective-level democratisation, two objective components are introduced: 1) participation incentives that reward broad local engagement, and 2) an exchange channel preference index (ECPI) that prioritises local and inter-community exchange while penalising excessive grid reliance. Two privacy-preserving federated architectures are developed to embed these components into the coordination layer using SCA-ADMM: a community-level DF-MCEM (CDF-MCEM) that enforces consensus on inter-community trades, and a system-level DF-MCEM (SDF-MCEM) that introduces a second consensus on aggregated channel-usage shares. A democratic energy market index (DEMI) is introduced to evaluate realised outcomes in terms of procedural democracy, distributive equity, and spatial localism. Across nine scenarios and four architectures, activating the democratisation-aware terms increases DEMI by 0.101–0.113 absolute points relative to the non-democratised centralised benchmark. CDF-MCEM closely reproduces the democratisation-aware centralised solution, with an average welfare gap of only 0.16% and an average traded-energy gap of 0.27%. SDF-MCEM provides an explicit system-level democratisation-consensus layer, with an average welfare loss of 2.62% relative to the democratisation-aware centralised benchmark. The results show that democratisation-aware federated coordination can substantially improve participation, equity, and localism while keeping agent-level data local.

Subjects

Distributed optimisation

Energy communities

Energy democracy

Federated market-clearing

Privacy-preserving coordination

DDC Class

537: Electricity and Electronics

Options

Dual-consensus federated electricity market coordination for privacy-preserving and democratisation-aware trading across interconnected energy communities