Analysis of the assumed cost of penalty payments in a municipal MV distribution network

The paper presents the results of the analysis of the estimate of the cost of penalty payments for breaching the guaranteed standard of the electricity supply continuity. A real municipal MV cable distribution network was analysed. The estimate of the cost of penalty payments was obtained by simulating supply interruptions in the network by using a modified Monte Carlo method. The analysis is performed for various types of the guaranteed standard. Both the limit of the annual number of supply interruptions for a consumer and the limit of the total annual duration of supply interruptions are considered. The costs of penalty payments for the annual evaluation and the evaluation based on two-year mean values are compared. The results obtained reveal that, for the given network, the cost of penalty payments can represent an amount of money that cannot be neglected. Some conclusions are therefore given at the end of the paper which may be used by the managing staff of the distribution company when optimizing the distribution network just with the aim of reducing the cost of penalty payments.