Enhanced LRIC pricing differentiating generation technologies and load classes

摘要

Traditional distribution network pricing methodologies like long run incremental cost pricing (LRIC) offer location-specific signals to network users (generation/load) and charge them as per their contribution to network utilization. These methodologies consider maximum generation and load at the connection node that may not be coincident with distribution asset peak demand, thus failing to reflect user's true contribution to driving distribution network investment. This paper proposes an enhanced LRIC pricing mechanism based on the contribution of generation and load located at various nodes, to network peak of each upstream asset. This contribution is modeled as a load-to-asset contribution factor (LACF) and generation-to-asset contribution factor (GACF) for load and generation users respectively, to assess the impact of user contributions during peak load on network investment. The approach helps network users to reduce their network usage charges by minimizing their usage contribution to distribution network peaks, eventually reducing distribution network investment.