Assessment of Regulatory and Market Challenges in the Economic Feasibility of a Nanogrid: A Brazilian Case

Abstract

Microgrids have emerged as a popular solution for electric energy distribution due to their reliability, sustainability, and growing accessibility. However, their implementation can be challenging, particularly due to regulatory and market issues. Building smaller-scale microgrids, also known as nanogrids, can present additional challenges, such as high investment costs that need to be justified by local demands. To address these challenges, this work proposes an economic feasibility assessment model that is applied to a real nanogrid under construction in the Brazilian electrical system, with electric vehicle charging stations as its main load. The model, which takes into account uncertainties, evaluates the economic viability of constructing a nanogrid using economic indicators estimated by the Monte Carlo simulation method, with the system operation represented by the OpenDSS software. The model also considers aspects of energy transactions within the net-metering paradigm, with energy compensation between the nanogrid and the main distribution network, and investigates how incentives can impact the viability of these microgrids.