Peak shaving: a planning alternative to reduce investment costs in distribution systems?

In the future, the foreseen increase of residential electricity consumption will force the Distribution System Operators to reinforce their networks at great expense. Through the emergence of ICT solutions and the increase of electric consumption flexibility at residential level, peak shaving has become an interesting alternative for reducing the investment costs in a distribution grid facing a load increase. This can be achieved with energy management systems (EMS) installed at residential level. Specifically, this work aims at considering peak shaving as an alternative to network reinforcement in a 20-year distribution planning study. For this purpose, the present work incorporates an optimal peak shaving approach to an accurate Convex DistFlow-based planning approach. Based on this, it quantifies how peak shaving can economically compete with network reinforcements for 12 real UK distribution networks under various flexibility scenarios. The results highlight that peak shaving is a competitive alternative to line reinforcement if the maximum initial line loading at the initial year of the planning study is under 80% of its nominal thermal rating value. It is also shown that EMS devices with a cost between 10 and 250 £/unit are economically competitive with network reinforcements depending on the considered network. Finally, this work proposes a planning decision metric, the initial line loading (ILL), measured at the beginning of the planning study, on the basis of which reinforcement decisions can be made.