An Innovative Framework for Heterogeneous Renewable Energy Communities Providing Flexibility Services in Distribution Networks

Increasing electrification and distributed energy integration exacerbate congestion and voltage deviations in distribution networks. Renewable energy communities (RECs) have emerged as a promising bottom-up solution, enabling local coordination and grid support through participation in local energy and flexibility markets. However, market inefficiencies, such as strategic manipulation of the baseline, and the heterogeneity of user preferences introduce substantial complexity to their design and operation. Motivated by these challenges, this paper proposes a novel three-stage framework that jointly considers user behavior and system-level needs. In the first stage, RECs engage in local energy markets (LEMs), where electricity prices are competitive and consider collective users' diverse preferences to ensure efficient energy trading. In the second stage, RECs offer baseline-constrained flexibility services to the distribution system operator (DSO) through the local flexibility market (LFM), which allocates rewards based on actual grid support delivered. In the third stage, internal revenue sharing among REC members is determined through a fairness-guaranteeing method that accounts for marginal flexibility contributions. Simulation results show that, beyond users' preferences, all RECs benefit from participation in the framework; however, these benefits vary according to the preferences and seasonal conditions. These factors also influence REC performance as well as DSO operation and associated costs. The LFM results for a representative winter day indicate the financially-driven member achieves the highest total flexibility revenue (€140.88), while the comfort-driven member earns lower revenue (€35.27). Furthermore, DSO congestion management costs decrease from 2738.83 €/day in winter to 795.17 €/day in summer, which shows seasonal dependence and user behavior in grid operation.