Newsletter – Business and management models and recommendations

During the last decades, the solar photovoltaic (PV) technology has improved its effectiveness and its manageability significantly, and progressively reduced its costs per each installed megawatt. Additionally, the massive application of telecommunication and information technologies has produced great advances in terms of control and monitoring of the renewable energies and their integration in distribution grids.

Nowadays different type of consumers, different regulatory revenue models and a variety of energy players have appeared and their role is and impact is crucial to be evaluated. In iDistributedPV project we analysed the emergence of new business and management models related to the penetration of distributed solar PV generation and the recommendations we provide will aim to enable the large penetration of distributed solar PV, for encouraging the consumers and players in the energy sector to join and point out possible barriers and solution to them that will appear in the transition.

Residential consumers should size properly their PV installation to avoid profitability losses and excessive generation surplus. Changes in their consumption habits and penalties from a retribution scheme for the generation excesses, even if they seem against their comfort, would be beneficial and they will have a positive impact. As a result, it is useful to self-consume the most of the energy produced by the panels. Moreover, they should consider to add batteries to the installation to reduce the power capacity concept of the bill or completely disconnect from the grid.

Industrial consumers should install PV panels to self-consume their own electricity. Self-consumption will reduce the energy and power capacity concepts of the electricity bill. Also, they should consider the use of controllable loads in their facilities to avoid energy injection to the grid and allow the installation of more PV capacity. They could also participate on ancillary services for the grid (through an aggregator if possible).

Energy communities, where citizens own and participate in renewable energy or energy efficiency projects, are a significant element in Europe’s low carbon energy transition. One of their main roles is to cluster several consumers to adopt distributed solar PV. iDistributedPV project proposes some important steps to achieve that, like to establish a method to share value derived from the solar installation and exploit the full potential of the relationship among consumers, engage more consumers at one time to benefit from the PV generation, harness most of the electricity produced due to the characteristic flexibility of the clustered consumers and profit from self-consumption with lower investment costs due to scale economies.

An aggregator is a new type of energy service provider that can increase or moderate the electricity consumption of a group of consumers according to total electricity demand on the grid.  An aggregator can also operate on behalf of a group of consumers producing their own electricity by selling the excess electricity they produce. He should coordinate the Demand Response practices among the consumers and prosumers and poll the flexible loads from his clients to participate in the reserve markets. Of course, he should always assure the stability of the grid and act for the best interest of the client.

Lastly, Distribution System Operators main goal should be to adapt their grids to allow the large penetration of distributed solar PV through a series of actions. They should invest on adapting their grids to support the reverse flows produced by the distributed generation and increasing the observability of their assets and the communications among clients and TSO. Moreover, they could install their own facilities of distributed PV generation. Another useful strategy could be to request for subsidies and compensations for the reduction of technical losses thanks to the flexibility they would offer and the enable of the penetration of distributed generation based on renewable energies. Aware customers are a better audience to deliver the energy transition message and in order to achieve that, DSOs should also engage consumers through new technologies and flexibility services.

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