Developing Novel Technologies and Services for Intelligent Low Voltage Electricity Grids: Cost–Benefit Analysis and Policy Implications

Alemu Moges Belay, Sanket Puranik, Ramon Gallart-Fernández, Heidi Tuiskula, Joaquim Melendez, Ilias Lamprinos, Francisco Díaz-González and Miha Smolnikar
Additional contact information
Alemu Moges Belay: Smart Innovation Norway, Håkon Melbergs vei 16, 1783 Halden, Norway
Sanket Puranik: Smart Innovation Norway, Håkon Melbergs vei 16, 1783 Halden, Norway
Ramon Gallart-Fernández: Estabanell Energia, C. del Rec, 28, 08401 Granollers, Spain
Heidi Tuiskula: Smart Innovation Norway, Håkon Melbergs vei 16, 1783 Halden, Norway
Joaquim Melendez: Institut d’Informàtica i Aplicacions, University of Girona, Campus Montilivi, 17003 Girona, Spain
Ilias Lamprinos: Intracom S.A. Telecom Solutions, 19.7 km Markopoulou Ave., GR-19002 Peania Athens, Greece
Francisco Díaz-González: Centre d’Innovació Tecnològica en Convertidors Estàtics i Accionaments (CITCEA-UPC), Department of Electrical Engineering, Universitat Politecnica de Catalunya ETS d’Enginyeria Industrial de Barcelona, C. Avinguda Diagonal, 647, Pl. 2, 08028 Barcelona, Spain
Miha Smolnikar: ComSensus d.o.o., Brezje pri Dobu 8a, SI-1233 Dob, Slovenia

Energies, 2021, vol. 15, issue 1, 1-25

Abstract: The paper presents a set of prototype smart grid technologies and services and validates the economic viability of the proposed solution using cost–benefit analysis (CBA). The study considered the EU-funded project called RESOLVD and implemented the technologies and services in a real-life pilot. The paper focuses on the analysis of technological solutions which enhance the operational efficiency and the hosting capacity of low-voltage electricity distribution grids. The solutions provided better integration of a hybrid battery storage system, with the grid interfacing power electronics, smart gateways for the interconnection of assets at the grid edge, and sensors enhancing infrastructure observability and control. The result from the CBA indicates the economic viability of the project, high scalability, and replicability. The economic benefits were realized with the breakeven value of eight secondary substations (SS) and 16 feeders. The scenario test on the DSO’s willingness to pay for the software as a service (SaaS) revealed that the payback period can further be reduced by almost half with a higher internal rate of return (IRR) and net present value (NPV). Both the CBA and scenario tests showed RESOLVD solution can become more economically viable when deployed in largescale. Moreover, the CBA results provide evidence to the energy policy by allowing DSOs to consider both CAPEX and OPEX for better investment decisions. Further, the paper proposes an alternative business approach that shifts from grid reinforcement to service provision. The paper also discusses the research implications on energy policy and business.

Keywords: cost–benefit analysis; smart grid; hosting capacity; efficiency; technology; economic; the EU; willingness to pay; policy (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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