An Economic Model for Distributed Energy Prosumers

In order to optimally schedule energy, consumers need to understand their energy utility function. The traditional utility function must be modified when consumers acquire production capabilities and become prosumers. This paper presents a formal economic model for prosumers, appropriately integrating distributed generation, storage and demand response capabilities. We identify the limitations of existing prosumer-like models. Finally, we demonstrate how the proposed prosumer model is applied to energy evaluation to distributed prosumer decisions regarding environmental objectives.