Evaluating investment strategies for distribution networks based on yardstick competition and DEA

• Published in: Electric power systems research 2019-09, Vol.174, p.105868, Article 105868
• Main Authors: Liu, Youbo, Wang, Mingjuan, Liu, Xianglong, Xiang, Yue
• Format: Article
• Language: English
• Subjects: Competition; Constraint modelling; Construction costs; Criteria; Distribution management; Distribution network investment; Dynamic DEA; Electric industries; Investment; Investment strategy; Networks; Numerical analysis; Operations research; Optimization; Power efficiency; Power supplies; Power supply; Projection pursuit method; Resource allocation; Reward and punishment regime; Sustainable development; Weight; Yardstick competition
• ISSN: 0378-7796; 1873-2046
• DOI: 10.1016/j.epsr.2019.105868

•A relatively comprehensive “inputs-outputs” evaluation index system is established.•A new combination weighting method is presented to determine the index weights.•The traditional DEA model is improved to compute the investment efficiency.•Yardstick competition is applied to provide investment incentives.•The time degree theory is introduced to achieve dynamic evaluation. The traditional investment for distribution networks is mainly evaluated and conducted from the static perspective. A dynamic comprehensive evaluation method is essential to obtain an efficient investment strategy. Firstly, a hierarchical evaluation index system is constructed to describe the overall performance of the distribution network, which includes six types of criteria such as information level, power supply capacity, asset utilization efficiency and economy, power supply quality and loss, power supply reliability, and sustainable development level. Each criterion is composed of input and output indicators. Then, using projection pursuit method considering subjective weight constraints, a combined weight optimization model is proposed to calculate the weight vector of each criterion. Furthermore, the data envelopment analysis (DEA) based dynamic evaluation approach is set up to compute the investment efficiency defined as ratio of output and input. The time degree theory is also introduced to realize dynamic evaluation. Via yardstick competition among multiple regions and “reward and punishment” rule, a precise investment planning strategy can be achieved while minimizing construction cost and maximizing efficiency of the resource allocation. The numerical results on a practical 10-region distribution system in four planning cycles verify the effectiveness of the proposed method.