Costs and benefits assessment considering deferral of assets expansion in distribution systems

Distribution network planning is to identify the least cost network investment that satisfies load growth requirements without violating any system and operational constraints. Due to their high efficiency, small size, low investment cost, modularity and ability to exploit renewable energy sources, are increasingly becoming an attractive alternative to network reinforcement and expansion. Numerous studies used different approaches to evaluate the benefits to a network from DGs in the form of loss reduction, loading level reduction. However, few of the studies have shown how to translate these into monetary terms reflecting the resultant reduction in system operation and development. This paper presents a novel methodology for quantifying the benefits to a network in terms of investment deferral arising from connecting distributed generation (DGs) in the distribution network. Starting from the principle that the time horizon of future reinforcement of an asset in the network can be evaluated from the asset loading level and the projected load growth rate, as developed by the University of Bath, the loadflow-based methodology aims to translate the investment horizon into monetary terms reflecting future network development cost. Using the proposed methodology, the paper quantifies the network costs or benefits introduced by DGs in terms of thermal capacity limits of lines and assets. The proposed method is demonstrated on the IEEE 14 bus system, quantifying the costs and benefits to the network when connecting DGs at various sites and in different sizes. This method can also be used as a platform to assess the fitness of future DG siting and sizing plans in a distribution network.