A Novel Distribution Use of Network (DUoN) Pricing Algorithm for Efficient Charging of Loads and Distributed Generations

Distribution use of network (DUoN) charges apply to every customer associated with the distribution network. This particular charge is significant and is required to collect the revenue for installing, operating, and maintaining the distribution network assets. In this paper, a DUoN pricing algorithm is formulated to charge the consumers and distributed energy resources (DERs) based on their influence on the distribution network's real and reactive power flow. In the proposed method customers/users associated with the distribution grid are charged based on the amount of real and reactive power they are consuming, the distance used to support customers' real and reactive power injection/withdrawal, the capacity of network assets being utilized while power is being delivered to consumers and influence on system power factor. Also, because of the appraising and penalizing characteristics of the proposed DUoN charging mechanism, the proposed pricing algorithm may encourage users to act based on the local economic signal. The proposed charging algorithm has been tested on a modified Western Power Distribution network.