An optimal compensation schemes decision framework for solar PV distributed generation trading: Assessing economic and energy used for prosumers in Malaysia

Abstract

While discovering for the competitive rates of renewable energy (RE) generated, the compensation schemes in Malaysia have changed several times since 2011. Due to inadequate financial return, the earlier net-energy-metering (NEM) scheme introduced in 2016 had seen reluctance in user engagement compared to the prior feed-in-tariff (FiT). Hereof, NEM had evolved to NEM 2.0 and NEM 3.0 to continue the initiative of solar PV rooftops. However, the performance of NEM 3.0 in providing attractive compensation scheme to prosumers has yet to be quantitatively studied. In this paper, we developed three (3) solar PV compensation scheme models (i.e., self-consumption (SELCO), NEM 2.0 and NEM 3.0) to assess the prosumers’ economic and energy used profile. A university building that plays role as prosumer and holds a commercial flat electricity tariff has been chosen as a case study. The analyses will examine the impact of each compensation scheme model on consumer electricity bills under different electricity pricing tariff schemes (i.e., flat, real-time and enhanced-time-of-use (ETOU)). The results found that regardless the sizing of solar PV, the NEM 2.0 model shows an accrued bill savings of about 45% to 50%, followed by NEM 3.0 and SELCO accordingly. This is due to the facts that one-on-one offset prices basis for NEM 2.0 is higher than NEM 3.0 that depends on real-time wholesale tariff. Furthermore, by increasing the percentage of deferrable load for demand side management strategy will increase the electricity cost savings. The findings that appeared in this paper could assist the prosumers in choosing the optimal compensation scheme for solar PV at the distribution level while supporting the government and policymakers in designing effective compensation schemes.