Conception of innovative business models for active integration into network of decentraliced units for consumers and producers

Status

completed

Summary

Recent developments in electricity supply initiated a process of transforming centrally organised electricity supply environments to more and more distributed ones. As a result, distribution grids increasingly have to face system related challenges (e.g. voltage and capacity related problems) to further integrate distributed, renewable and volatile generation capacities into existing grid infrastructures. However, research for innovations in grid integration and operation approaches show that there exist alternatives to conventional methods by implementing active network management concepts based on new communication technologies. These alternatives - mostly called as “Smart Grid solutions” - enable a more active distribution grid design - among others - due to participation of small scale generation (by controlling reactive and active power settings) units and demand (e.g. by shifting demand to base load periods). Thus, such solutions necessarily have to result in alternative business strategies or models in order to pay off for instance extra costs incurred due to active power curtailments of generation units. In general, such business models incorporate the interactions, strategies and value exchanges of different actor segments in a distributed electricity supply system.

Above all, the main goal of this project is to show the economic impacts of several alternative Smart Grid related business models from selected actors’ perspective characterised by generation, demand, electricity suppliers as well as Distribution System Operators (DSOs). Therefore, four Austrian distribution grid case study areas are comprehensively analysed in order to derive corresponding income and payment balance changes of each actor. In order to prove possible discrimination issues, two newly developed Pareto criterions are considered. Furthermore, the project provides a bottom-up analysis of case study related results towards possible future scenarios of business model related costs and benefits in Austria. This is performed by discussing future capacity developments for distributed generation based on renewable energy sources (DG/RES). Even more, future cost development bandwidths for different DG/RES distribution grid integration strategies as well as upper cost limits for Smart Grid solutions (e.g. Demand Side Management or Smart Metering solutions) are derived and discussed in detail.

Selected calculation results (bottom-up as well as top-down analysis) show that benefits for demand referred to overall installed metering points (mp) in Austria could develop up to 176 €/mp*yr in 2050 (within the Smart Grid and Efficiency DG/RES development scenario), if demand intents to install own generation units. On the contrary, generation could face extra cost of up to 156 €/mp*yr in 2050 (within the Smart Grid and Efficiency DG/RES development scenario), if use of system charges for feeding electricity into the grids are applied. Hence, each business model and DG/RES development scenario derives manifold cost / benefit combinations. Besides that, new grid integration approaches (e.g. coordinated voltage control) show the possibility to reduce future distribution grid cost significantly.

In general, some of the proposed business models and cost allocation strategies show high benefit potentials for selected actor segments. On the contrary, as other actors face the risk of extra costs due to such business models the possible pathways towards a changed electricity supply system need to be well considered. Moreover, detailed technology and business case specific cost / benefit analyses on disaggregated actor level (including profit and loss account calculations) are recommended.

Project management

Dr. Wolfgang Prüggler
Institut für elektrische Anlagen und Energiewirtschaft - Energy Economics Group, TU-Wien

Project or cooperation partner

• Dr. Hans Auer, Dipl.-Ing. Carlo Obersteiner, Dipl.-Ing. Rusbeh Rezania
  Institut für elektrische Anlagen und Energiewirtschaft - Energy Economics Group, TU-Wien
• Dipl.-Ing. Helfried Brunner, Dipl.-Ing. Benoit Bletterie
  Österreichisches Forschungs- und Prüfzentrum Arsenal GmbH, Austrian Institute of Technology
• Roland Weyss
  oekostrom Produktions GmbH
• Dipl.-Ing. Josef Bärnthaler
  Energieagentur Obersteiermark