IEEE Electrification Magazine - December 2016 - 33

valuation, hybrid economic and control theory, and architecture/interoperability/outreach-are tasks within a
suite of transactive systems projects at the PNNL and
closely mirror the organization of the OE DOE program.

Valuation
The DOE research portfolio strives to quantify the value of
transactive systems themselves as well as the value that
transactive systems are able to reveal or create. A fundamental question is whether valuation studies should be
conducted any differently when power grid scenarios
employ transactive systems to coordinate the power grid's
flexibility. A final report published earlier this year suggests the answer is yes, they should.

Hybrid Economic and Control Theory
Now that the research community has begun to define
and test transactive systems, at least at pilot-scale levels,
we strive to understand these interesting and complex
systems. Can economic theory or control system principles describe and bound, if not accurately predict, the outcomes of transactive systems? What, if anything, can be
done to ensure that a transactive system will converge
toward an optimum solution? What are the bounds to
safely predict stable behavior? How can we characterize
the behavior of hierarchical or layered interactions across
the electric system from wholesale/bulk power, medium
voltage distribution, and retail delivery?

Architecture/Interoperability/Outreach
The introduction of transactive system techniques into
power system operations requires engineering concepts
and business policies to be aligned across the electricity
stakeholder community. Collaboration and outreach are
critical, especially in the formative years of transactive
systems. Much education and eventual buy-in may be
required before transactive systems will be adopted and
used. The way that grid operations are structured to
accommodate transactive systems needs to be reviewed
architecturally, with buy-ins from stakeholders. Transacting devices and systems will also need to have welldefined, cyberphysical interfaces that allow them to
easily integrate with the grid and operate reliably. A variety of products and services needs to be established to
support certification to standards and run on trusted
platforms. The DOE's roles in forming and supporting the
GWAC, Smart Grid Interoperability Panel, and National
Institute of Standards and Technology Transactive Energy
Challenge are examples of such contributions to architecture, interoperability, and general outreach.

Simulation
Transactive system technology advancement may be
currently limited by our abilities to simulate such systems. Transactive systems require economic principles
and market-like structures to be applied to physical

Assets engaged by the PNWSGd

he following types of assets were engaged by the PNWSGD:
electric water heaters, solar PV generators, distributed

generation, battery storage, residential thermostats, dynamic
voltage management, a suite of smart residential appliances,
in-home displays, wind generation, and smart transformers.

circuit models; economic and market influences must
therefore be cosimulated with the physical system to
accurately represent their effect. Furthermore, transactive systems are influenced by human behaviors that
are extremely hard to characterize and predict. For
example, what drives an individual to place a bid or an
offer into a transaction, and can that outcome be modeled either for the entire market or for individual market participants? System participants' abilities to offer
flexibility into the system are driven by tradeoffs among
cash, social welfare, and participants' perceptions of
their energy-use objectives, such as comfort. As transactive systems engage electricity customers and other distribution system actors, transmission system and
distribution system simulations interact; they can no
longer be simulated as entirely separate, independent
parts of the power grid.
The DOE EE Building Technologies Office envisions
transactive systems as a potential solution to its ambitious energy conservation goals for buildings. Namely,
the office challenges U.S. commercial buildings to reduce
energy use 20% by 2020 and 50% by 2050. The research at
the PNNL and elsewhere is proposing numerous building-level transactive systems as a step toward achieving
these goals. Furthermore, if the new methods can be
reproduced quickly from one successful implementation
to the next, the research investment pays dividends
quickly. The VOLTTRON application platform has gained
some traction in this respect, in that the core implementation is an open-source platform. New applications are
being added to the VOLTTRON repository, many of which
are openly available.

Valuation Studies Applied
to Transactive Systems
The DOE OE and EE jointly invested in a PNNL research
effort to value transactive systems. More precisely, the
research tackles those considerations that must be made
to value and compare various transactive system mechanisms as they are applied to the grid and other objectives
and services. After realizing the challenge of comparing
alternative transactive mechanisms that are only subtly
different, a rigorous effort was launched to represent a
fundamental structure of valuation studies and to create
the context under which the valuations and comparisons
could be meaningfully completed.
IEEE Electrific ation Magazine / d ec em be r 2 0 1 6

Table of Contents for the Digital Edition of IEEE Electrification Magazine - December 2016