Cost allocation in integrated community energy systems - A review

Li, Na; Hakvoort, Rudi A.; Lukszo, Zofia

doi:10.1016/j.rser.2021.111001

Cited by 48 publications

(20 citation statements)

References 71 publications

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“…Then, the performance of cost allocation methods in terms of the criteria defined in Section 2 is analyzed. Ten cost allocation methods are adopted based on the research in [32], and they are summarized in Table 1 by illustrating their main concepts as well as energy bill components.…”

Section: Cost Allocation Methods and Performancementioning

confidence: 99%

“…If the energy bill structure includes the criteria as a pricing component, the method satisfies that criterion, otherwise, it does not. For the last two criteria (cost reflectiveness and cost predictability), their values are calculated in the research [32] for each individual customer according to their definition. However, in order to estimate the overall performance of each method, the variance of a set of cost reflectiveness and predictability from individual customers is used.…”

Section: Cost Allocation Methods and Performancementioning

confidence: 99%

“…The investment of ICESs has the characteristic of community-owned [4], each member should pay for the cost they cause, and the free-rider behavior is not appreciated in an ICES. Fair cost allocation also promotes the cooperation of the local community and contributes to the long-term development of ICESs [8]. Cost allocation should reflect all the costs involved in ICESs, such as capital cost, operation and maintenance cost, and customer service cost as well as local energy management system cost.…”

Section: Introduction 1background and Motivationmentioning

confidence: 99%

“…Besides, many methods can be used to allocate costs in ICESs according to our previous study [32]. For instance, the costs can be allocated based on energy pricing per kWh, or capacity pricing per kW, or the number of customers, or any combination of these.…”

Section: Introduction 1background and Motivationmentioning

confidence: 99%

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Cost Allocation in Integrated Community Energy Systems—Social Acceptance

Hakvoort

Lukszo

2021

Sustainability

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Integrated community energy systems (ICESs) are a good representative of local energy systems by integrating local distributed energy resources and local communities. It is proposed that costs should be allocated in a socially acceptable manner since there is no regulation in ICESs. In this paper, social acceptance is conceptualized from the dimension of community acceptance considering procedural and distributive justice. A fair process increases the understanding and the acceptance of the cost allocation outcomes, and a fair outcome leads to the acceptance of the cost allocation procedure. This approach adopted the multi-criteria decision-making technique to evaluate social acceptance to select a cost allocation method that was socially acceptable to local community members. The results show that our approach is unique and useful when multiple decision-making groups have to decide together upon the cost allocation method. It is able to provide quantitative results and optimal decisions from a multi-group decision-making perspective. The methodology developed in this research can be applied to any local community energy system to select a cost allocation method. Furthermore, the obtained results can be used by decision-makers to support them in the decision-making process. Based on our approach, policy implications are also analyzed to support the success of cost allocation in ICESs.

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Section: Cost Allocation Methods and Performancementioning

confidence: 99%

Section: Cost Allocation Methods and Performancementioning

confidence: 99%

Section: Introduction 1background and Motivationmentioning

confidence: 99%

Section: Introduction 1background and Motivationmentioning

confidence: 99%

See 2 more Smart Citations

Cost Allocation in Integrated Community Energy Systems—Social Acceptance

Hakvoort

Lukszo

2021

Sustainability

Self Cite

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“…The contribution of each generator unit in the non-power flow-based method is calculated by using the fixed network cost of each line and the magnitude of the DER's transacted power as in postage stamp and contract path methods [8]. Among non-power flow-based methods, the postage stamp method is widely used in some countries because of its simplicity [9][10][11]. Power flow-based methods, such as proportional sharing, Kirschen's tracing, equivalent bilateral exchange, and Z-Bus NCA methods, identify the amount of power flow on specific lines due to market transactions and thus calculate the contribution of every generation unit to each transaction as the NUC [12].…”

Section: Introductionmentioning

confidence: 99%

Congestion Management by Allocating Network Use Cost for the Small-Scale DER Aggregator Market in South Korea

et al. 2021

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The increasing penetration level of distributed energy resources (DERs) increases the risk of congestion in the distribution network. To mitigate this, the concept of the small-scale DER aggregator was introduced as a change from uncoordinated to coordinated DERs. However, without appropriate network use cost allocation, the unwanted DER curtailment will be enforced by the network operator. Therefore, this paper proposes a new approach for congestion management by allocating the different network usage costs depending on how much congestion is caused by the DERs in the distribution network. For this, a modified Kirschen’s tracing method is proposed and applied to the small-scale DER aggregator market. To verify the effectiveness of the proposed method, a simulation of the small-scale DER aggregator market in South Korea was performed under the IEEE 69-bus distribution network. The model was able to allocate the different network usage costs at different buses and, thus, encouraged the DERs to reduce their generation by charging the energy storage system (ESS) to mitigate congestion. An economic benefit analysis was also performed from the point of view of the aggregator concerning whether they should have an ESS or not.

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Urban integrated energy system construction plan selection: a hybrid multi-criteria decision-making framework

Zhao,

Guo

2024

Environ Dev Sustain

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Cost allocation in integrated community energy systems - A review

Cited by 48 publications

References 71 publications

Cost Allocation in Integrated Community Energy Systems—Social Acceptance

Cost Allocation in Integrated Community Energy Systems—Social Acceptance

Congestion Management by Allocating Network Use Cost for the Small-Scale DER Aggregator Market in South Korea

Urban integrated energy system construction plan selection: a hybrid multi-criteria decision-making framework

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