Investigating the Impact of Distributed Generation on the Retail Price of Electricity Market in Iran's Electricity Distribution Network

Today, renewable energy sources are receiving attention in many parts of Iran. The increase in the penetration rate of these sources in Iran's distribution network will have extensive adverse effects. The retail price of Iran's electricity market is one of the most critical factors affected by Distributed Generation (DG). Many customers of the distribution company in Iran pay less for electricity; They install photovoltaic panels on the roof of their houses or use other sources such as combined heat and power and small wind turbines; to supply a minor part of their electricity consumption through the national electricity network of Iran. This will reduce the income of distribution companies in Iran. According to the regulation of the distribution companies' payment, this revenue decrease should be recovered through an increase in the price of electricity. The increase in the electricity rate makes the customers use DG resources in advance to pay less money for electricity to the distribution company. In this article, DG resources, their types, goals, and benefits are introduced; And the structure of the tariff market of Iran's electricity distribution company is examined. Based on the findings of this article, it can be concluded that by installing DGs, significant savings can be achieved in the amount customers pay for electricity. Furthermore, Iran customers will significantly desire to buy and install these resources. However, DG can change the tariff structure of retail electricity prices in Iran's electricity market.