Impact assessment of net metering for residential photovoltaic distributed generation in Peru

Abstract

The integration of distributed generation is based on legal and regulatory mechanisms which provide the technical and economic conditions of energy exchange with the electricity distribution network. In Peru, the definition of regulatory mechanisms and technical-economic conditions of connection of distributed generation are under discussion and development. This paper evaluates the technical-economic impact of integration mechanism called net metering on the end-user and the electricity distribution company (DSO), by connecting photovoltaic (PV) systems to the distribution network of the Arequipa City. The evaluation from residential end-user, connected to the low-voltage grid and associated with tariff BT5B, it is in terms of the installed PV power in kWp and the greater expected economic benefit, in terms of optimum values for consumption range. The evaluation from DSO, is made based on purchase energy blocks to the wholesale market to distribute regulated users. In addition, has been used indicators such as the self-consumption rate, coverage rate and impact about billing. The results find that net metering provides a strong economic incentive for the installation of PV systems by the residential user of higher energy consumption, a payback time of 6 years, considering that in the region analysed there are high level of solar irradiation. Consequently, end-users with low energy consumption will have less incentive to become prosumers, due to the existence of subsidized rate. The DSO would experience a reduction in the sustainability of its business, due to the injection of energy to the distribution network with a higher price than spot market.