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-Load shifting and peak shaving under time-of-use rates
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Microgrids are an increasingly common component of the evolving electricity grids with the potential to improve local reliability, reduce costs, and increase penetration rates for distributed renewable generation. The additional complexity of microgrids often leads to increased investment costs, creating a barrier for widespread adoption. These cos...
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... economic impact of this value stream can be particularly high in scenarios where utility TOU rates consist of both volumetric and power charges. Such tariffs are typically very strong incentives to enable both load leveling and peak shaving, as illustrated in Figure 1. In this case, an optimized load profile would theoretically be capped by a dynamic maximum demand level that follows the different time-ofuse periods established in the utility tariff. ...
Citations
... Practical feasibility, on the other hand, assesses the cost-benefit analysis of microgrid implementation [24], including the initial installation costs [25], maintenance and operating expenses [21,26], and potential revenue streams [27]. ...
... A number of identified independent business entities are in this framework developed on the basis of value creation, delivery and value capture (De Martini, 2019). Similarly, microgrids provide value streams in areas like Demand Response (DR), energy markets and improved resiliency (Stadler et al., 2016). Energy-attribute dependent characteristics of Smart Cities can be harnessed through business model innovation by energy utilities to tap the emerging economic opportunities in new electricity networks (Masera et al., 2018). ...
In electricity distribution networks, tariff designs set the interface between the users and network operators or service providers. Tariff designs provide the reference base for tariff schedules covering multiple categories of network users. It is widely accepted that electric utility rate designs have subjective and objective multi-criteria dependencies. Based on utility rate making literature, subcriteria for selection of tariff designs can be listed under the economic, technological, and social criteria. In this study, two widely used electricity tariff designs, volumetric or energy charges and capacity or demand charges are considered. In addition, real-time pricing and a hybrid tariff design that combines energy and capacity charges with critical peak pricing are also included in the comparison. Performance evaluation of these tariff designs on quantifiable parameters relating to economic aspects is carried out using the Tariff Design and Analysis Tool. Literature on electricity tariff designs and pricing provides the metadata on performance relating to qualitative criteria covering mainly the technological and social aspects. A synthesis of the quantitative and qualitative criteria evaluations was done by developing a Benefits-Opportunities-Costs-Risks (BOCR) model in the Analytic Network Process (ANP), a Multi-Criteria Decision Making methodology. A quantitative assessment of inconsistencies in evaluation and synthesis of the model using a consistency index shows that the developed ANP framework for tariff design selection is a valid approach. The developed BOCR model in ANP shows that the hybrid tariff design of Energy and Capacity charges with Coincident Peak Pricing is the best alternative. A sensitivity analysis shows that the ranking is variable when the BOCR priorities change.
... Microgrids offer the main value streams, including enhanced supply resilience and reliability, demand response management (price and event-based incentives and direct/indirect benefits), power export, and ancillary and network support services (Stadler et al., 2015;Monash University, 2019;Wright et al, 2022). ...
This opportunity assessment reports on the state-of-the-art of Local Distributed Energy Resource (DER) Networks Solutions in Australia and aimed to identify the knowledge gaps in relation to the growth of renewable energy in local distribution networks that require attention from the research community.
... To this end, researchers provide reviews and tutorials on the use of microgrids internationally. Microgrids can be valuable [13], and their trajectories suggest that they are becoming https://doi. ...
Lack of access to reliable energy is a major concern for countries in sub-Saharan Africa. The national grids are unable to consistently satisfy demand. Therefore, users turn to distributed generation systems in the form of backup generators. However, such systems are usually designed based on a rule of thumb. We employ a mixed-integer linear programming model that considers several options such as renewable energy, combined heat and power, and storage technologies, in addition to those on-site, to provide optimal design and dispatch decisions that minimize total cost. We apply this model to a case study for a hospital in South Africa, considering its need for reliable electricity in light of multiple outages that might occur over the course of a year, as well as its high heating and cooling loads. Our results show that optimal design and dispatch decisions for the distributed generation system address reliability challenges, regardless of the time at which they occur. And, these solutions yield millions of dollars in savings, suggesting that technologies such as the absorption chiller may be overlooked in typical designs; its integration can reduce demand charges even in the absence of combined heat and power. We show that total cost is most sensitive to changes in site electrical demand, followed by capital cost, fuel cost, photovoltaic production, and monthly demand charges; changes in fuel cost primarily affect system sizes of combined heat and power and the absorption chiller, while photovoltaic system size is more sensitive to the changes in capital and fuel costs, photovoltaic resource availability, and hourly electrical demand. Finally, an outage simulator demonstrates the ability of our optimized system to sustain with no interruptions in power five-hour outages with probability 1.0 and ten-hour outages with probability 0.65, significant improvements over 0.5 and 0.0, respectively, under a business-as-usual case.
... As a complement to the utility grid, MGs supply power to a specific group of users in a particular area, where the users are usually single energy consumers. Currently, most studies on MG EMS focus on distributed energy capacity planning [92,93] , demand response optimization [94,95] , uncertainty scheduling methods [96,97] , and optimization solution methods [98,99] . ...
The widespread use of distributed energy sources provides exciting potential for demand-side energy sharing and collective self-consumption schemes. Demand-side energy sharing and collective self-consumption systems are committed to coordinating the operation of distributed generation, energy storage, and load demand. Recently, with the development of Internet technology, sharing economy is rapidly penetrating various fields. The application of sharing economy in the energy sector enables more and more end-users to participate in energy transactions. However, the deployment of energy sharing technologies poses many challenges. This paper comprehensively reviews recent developments in demand-side energy sharing and collective self-consumption schemes. The definition and classification of sharing economy are presented, with a focus on the applications in the energy sector: virtual power plants, peer-to-peer energy trading, shared energy storage, and microgrid energy sharing cloud. Challenges and future research directions are thoroughly discussed.
... LMs lead to many benefits to various market stakeholders (Kilkki et al., 2018). At the end-consumer level, LMs enable empowerment and a more active role in the energy markets, cost savings and increased energy efficiency (Stadler et al., 2016). It fulfills the growing citizens' willingness for local and sustainable energy supply (Mengelkamp et al., 2018b;Soeiro and Ferreira Dias, 2020). ...
With the development of decentralized sources of electricity generation, different ways of organizing electricity exchanges at the local level have been developed. The literature has studied extensively over the past decade how local exchanges can take place. This has resulted in different concepts reflecting different perimeters of study. However, the perimeters of these different concepts are not always well defined in the literature, which can lead to some con- fusion about the organization of the local market under study. There is a lack of harmonization because different terms may be used for the same concept or the same term may be used for several concepts. This paper aims to propose a harmonization of the different concepts for the study of local markets including local energy markets, peer-to-peer trading, local flexibility markets, microgrids, energy communities and transactive energy. These concepts are com- pared by identifying the characteristics of each. For this purpose, a literature review was per- formed in order to understand the context in which these concepts emerged and to identify their specific characteristics. Moreover, this paper proposes to analyze the economic challenges of local exchanges by identifying the economic incentives and solutions developed to make business models viable.
... Consequently, these changes in revenue streams will attract new actors to facilitate demand response, create flexibility for system operators (e.g., by means of aggregators), and install new equipment or services for customers as well as system operators [17]. The purpose of this new configuration in electricity systems is not merely sustainability but also moving towards goals related to other values (e.g., creation of local energy markets and fostering energy democracy) [22]. Based on this information, the smart grid can be considered as a disruptive (transformative) innovation [23]. ...
With its potentially disruptive nature, the smart grid can be viewed from both a transformational and an innovation systems perspective. Synthesising these, a research approach is adopted in which a Technological Innovation System (TIS) analysis is combined with a transformational perspective to identify a broader range of success and failure factors. This study analyses smart grid innovation system development. The main research question is: What systemic and transformational failures are identified in the development of smart grid innovation in the Netherlands from 2001 to 2021 by combining TIS and a transformational perspective? The question is answered by mapping the events to TIS functions and identifying both ‘systemic failures’ and ‘transformational failures’. Transformational failures are linked to events outside the smart grid TIS that work against the alignment and harmonising of activities within the TIS. Results show that the smart grid innovation system experienced three periods and that it suffers from various structural and transformational failures. TIS functions like knowledge diffusion, and the creation of legitimacy were only fulfilled to a limited extent. Consequently, smart grid innovation is currently still not considered a mainstream technology in the energy transition, and there is little attention to the role of end-users. The study ends with suggestions for future research, including the suitability of the research approach for other contexts and when applied to other energy system innovations.
... LMs lead to many benefits to various market stakeholders (Kilkki et al., 2018). At the end-consumer level, LMs enable empowerment and a more active role in the energy markets, cost savings and increased energy efficiency (Stadler et al., 2016). It fulfills the growing citizens' willingness for local and sustainable energy supply (Mengelkamp et al., 2018b;Soeiro and Ferreira Dias, 2020). ...
The development of distributed energy sources will challenge the management of the electrical system. Local flexibility markets (LFMs) are a promising solution to coordinate the dispatch of distributed energy sources. The LFM development is in its infancy, and numerous challenges should be addressed. This study focuses on four topics for LFM success: the governance model, coordination issues, inc-dec gaming, and competition. Based on a review of current projects, we identify challenges related to the four topics and discuss solutions to overcome these challenges. The proposed solutions are crucial to achieving market efficiency and cannot be considered independently.
... This is the author's version which has not been fully edited and content may change prior to final publication. which is the price that the customers pay to avoid power outages [44]. ...
This paper provides a stochastic framework for the energy management of multi-area hybrid microgrids to identify the optimal daily power dispatch in the islanded mode of operation. The primary goal of this framework is to minimize operational costs and power outages for customers by effectively managing the power resources of the hybrid microgrid. These resources include renewable energy sources, battery energy storage systems, and electric vehicles. To obtain accurate results, the costs related to active and reactive powers of diesel generator units are considered in this study. In addition, the uncertainties in the, power generated from renewable energy sources, electric vehicles charging and microgrid demand are modeled using the Monte Carlo Simulation as a scenario generation technique. The number of generated scenarios is reduced using the Fast Forward Scenario reduction technique. The proposed problem is formulated as a constrained mixed-integer nonlinear programming optimization problem and is solved using the Transient Search Optimization algorithm. The obtained solution is compared against other meta-heuristic optimization techniques to ensure the reliability of the results. To investigate the effectiveness of the proposed framework, several case studies are simulated on an islanded hybrid microgrid. The simulation results show the improvement in the economic performance and the reliability of the hybrid MG. The results also indicate the impact of increasing penetration levels of renewable energy resources on the operation cost and power exchange between AC and DC areas.
... The main objective of this paper is to give the inclusive review about the prevailing secondary level control methods as well as to indicate the possibilities for the further research in this field. In that sense, few research article providing MG reviews [34], [35], some focused on MG control [36]- [38] and few are on the secondary layer control system [22]. In view of the extensive study on communication system of MGs, this article emphasis on the secondary level control and configurations utilized in secondary layer through looking at lessening dependency on the infrastructure of communication and by considering diverse methods based on distributed control. ...
The proliferation of distributed energy resources in distribution systems has given rise to a new concept known as Microgrids (MGs). The effective control of MGs is a crucial aspect that needs to be prioritized before undertaking any implementation procedure. This article provides a comprehensive overview of hierarchical control methods that ensure efficient and robust control for MGs. Specifically, it focuses on the secondary controller approaches (centralized, distributed, and decentralized control) and examines their primary strengths and weaknesses. The techniques are thoroughly discussed, deliberated, and compared to facilitate a better understanding. According to functionality, the hierarchical-based control scheme is allocated into three levels: primary, secondary, and tertiary. For secondary control level, the MG communication structures permit the usage of various control methods that provided the significance of the secondary controller for consistent and reliable MG performance and the deficiency of an inclusive recommendation for scholars. Also, it gives a review of the literature on present important matters related to MG secondary control approaches in relation to the challenges of communication systems. The problem of the secondary level control is deliberated with an emphasis on challenges like delays. Further, at the secondary layer, the distributed control techniques for reducing communication system utilization and then reducing communication system delays are conferred. Furthermore, the benefits and limitations of various control structures, such as centralized, decentralized, and distributed are also discusses in this study. Later a comparative analysis of entire control approaches, the best methods of control according to the author’s perspective are also discussed.
