Automated energy sharing in MV and LV distribution grids within an energy community: A case for Croatian city of Križevci with a hybrid renewable system

Abstract

Local energy sharing (LES) is a concept that enables sharing between distribution system participants such as consumers, producers, and prosumers at the local level in a transparent and cooperative manner. It can improve local supply-demand balancing, reduce voltage deviations, and improve social welfare. However, the feasibility of such an approach is highly dependent on the regulatory framework and implementation requires investment in an adequate information and communication infrastructure. This paper examines components for the implementation of LES within energy communities in the EU, with a focus on price-forming methods that can be integrated into a net-billing system and adopted for different regulatory set-ups. Further, a method for the assessment of impacts on market participants is provided. The approach is applied for the assessment of the opportunities for LES in the city of Križevci, considering local generation, flexibility options, and real-life regulatory requirements. It is shown that LES under appropriate regulatory provisions can be an effective market-based mechanism for stimulating local generation and flexibility activation, and that way support decarbonization and local self-sufficiency. All members can benefit from participating in the energy community, but the distribution of the benefits notably depends on the applied LES price-forming method. On the other hand, subject to regulatory setup, the trade-offs are reflected on reduced revenues for market participants that generate income based on transmission fees, taxes, and/or surcharges.