An optimal investment planning framework for multiple distributed generation units in industrial distribution systems

This paper presents new analytical expressions to efficiently capture the optimal power factor of each Distributed Generation (DG) unit for reducing energy losses and enhancing voltage stability over a given planning horizon. These expressions are based on the derivation of a multi-objective index (IMO), which is formulated as a combination of active and reactive power loss indices. The decision for the optimal location, size and number of DG units is then obtained through a benefit–cost analysis. Here, the total benefit includes energy sales and additional benefits, namely energy loss reduction, network upgrade deferral and emission reduction. The total cost is a sum of capital, operation and maintenance costs. The methodology was applied to a 69-bus industrial distribution system. The results showed that the additional benefits are imperative. Inclusion of these in the analysis would yield faster DG investment recovery.