Renewables with Energy Storage: A Time-series Socioeconomic Model for Business and Welfare Analysis

Abstract

This paper seeks to quantify the effects of the increasing penetration level of renewable distributed generation and energy storage systems on the regulated electricity market over time. More specifically, the emphasis is on the long-term implications of distributed energy resources on energy loss and how it affects the electricity market. The proposed methodology is based on a modified combination of the Bass diffusion model (time-series forecasting of the penetration level of distributed energy resources) and the optimized tariff model (socioeconomic regulated electricity market model). Such models have not previously been applied jointly, even though they exhibit great potential for long-term market assessment in the context of distributed energy resources integration. The methodology enables the analysis of multiple public policies regarding renewable distributed generation and energy storage systems, such as net billing schemes to accelerate their deployment. Furthermore, the methodology also enables the assessment of energy storage systems' feasibility. By applying the methodology to a concession area in southern Brazil, results demonstrate that energy storage systems are feasible if combined with appropriate public policies, as a performance index (mean socioeconomic gain) of 329 (MR$) was obtained.