IEEE Systems, Man and Cybernetics Magazine - July 2021 - 11

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Digital technologies have led to solutions in different
domains where the price of producing a new unit of a specific
good tends to zero [1]. This is the so-called zero marginal
cost regime, where goods are abundant and,
therefore, markets-which presuppose scarcity-do not
function in the way their designers have expected.
For example, digital media, such as downloadable
music and ebooks, have nearly zero marginal costs since
the cost of producing one more unit of a copy of a given
good is virtually zero, in contrast to a CD or a printed
book, where there is a nonzero production cost [2]. (Actually,
there is always some small storage cost for digital
media, which is usually negligible in comparison to traditional
production costs.) As a result, new business models,
like subscription-based access (e.g., Netflix and
Spotify) and demand-based matching (e.g., Uber and Airbnb),
are now widely diffused. Such markets based on ICTenabled
platforms are not
the only possibility. An
alternative governance model-frequently neglected by
mainstream research-can be established based on a
shared pool of resources forming a commons [3]. The
importance of this approach was demonstrated by the
awarding of the Nobel Prize in Economic Sciences to Elinor
Ostrom in 2009 for her " analysis of economic governance,
especially the commons. "
Since the late 20th century, the electricity sector has
been moving toward a liberalized open market model. In
this free market-based design, public utilities are
unbundled to create liberalized markets comprising consumers,
energy retailers, distribution network operators,
transmission system operators, and large generation
plants. Today, the upsurge in the number of aggregators
and other ancillary energy service providers, who heavily
employ ICTs, is signaling some changes to the electricity
market. Changes are also precipitated by the fact that the
electric grid is moving toward a scenario where a large
fraction of the electricity costs is capital costs and marginal
operating costs are nearly zero [4]. This development
may well disrupt the current market structure or even
make electricity markets obsolete, especially in the case of
small-scale customers, such as households or offices, connected
to the distribution grid.
In Europe, electricity markets are evolving to accommodate
new elements and zero marginal cost production
(this has created negative prices during specific periods)
[5]. The " winter package " [6], [7] is a piece of concrete evidence,
where new regulations are being designed to support
a large number of entities whose main role is to
manage the distributed energy resources (DERs). Remarkably,
their management approaches strongly rely on ICTs,
creating a new series of cybersolutions, like virtual power
plants, virtual batteries, and virtual microgrids (see, e.g.,
several recent articles [8]-[11]), which have already been
incorporated in the system operation.
Most of these solutions implicitly assume that energy is
a scarce resource, and so markets would be a natural
July 2021 IEEE SYSTEMS, MAN, & CYBERNETICS MAGAZINE 11
http://www.SHUTTERSTOCK.COM/WINUI
IEEE Systems, Man and Cybernetics Magazine - July 2021

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