Risk-constrained multi-period investment model for Distributed Energy Resources considering technology costs and regulatory uncertainties

To, Thanh; Heleno, Miguel; Valenzuela, Alan

doi:10.1016/j.apenergy.2022.119210

Cited by 4 publications

(1 citation statement)

References 40 publications

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“…Risk constraints have the goal of limiting the undesirable consequences of uncertainty realization. The most common risk metric is the conditional value at risk (CVaR), which measures the right tail of the risk distribution [115]. CVaR has been used repeatedly in RE system design [77,95,106,132].…”

Section: Probability Distribution Functionsmentioning

confidence: 99%

Economic and Regulatory Uncertainty in Renewable Energy System Design: A Review

et al. 2023

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Renewable energy is increasingly mobilizing more investment around the globe. However, there has been little attention to evaluating economic and regulatory (E&R) uncertainties, despite their enormous impact on the project cashflows. Consequently, this review analyzes, classifies, and discusses 130 articles dealing with the design of renewable energy projects under E&R uncertainties. After performing a survey and identifying the selected manuscripts, and the few previous reviews on the matter, the following innovative categorization is designed: sources of uncertainty, uncertainty characterization methods, problem formulations, solution methods, and regulatory frameworks. The classification reveals that electricity price is the most considered source of uncertainty, often alone, despite the existence of six other equally influential groups of E&R uncertainties. In addition, real options and optimization arise as the two main approaches researchers use to solve problems in energy system design. Subsequently, the following aspects of interest are discussed in depth: how modeling can be improved, which are the most influential variables, and potential lines of research. Conclusions show the necessity of modeling E&R uncertainties with currently underrepresented methods, suggest several policy recommendations, and encourage the integration of prevailing approaches.

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