Effects of energy subsidies removal on distributed generation investment in Iran

In this paper effects of energy subsidies removal from Iranian economy and price of energy carriers have been investigated. In addition, a comparison is made between investment on distributed generation (DG) before and after this reform. This investigation carried out from both conventional and renewable technologies point of view. DG technologies which are considered in this paper are photovoltaic (PV), wind turbine (WT), gas turbine (GT), diesel engine (DE), and Microturbine (MT). For these technologies we have calculated total installed cost (the sum of the capital cost and installation costs), operation and maintenance (O&M) costs and fuel costs. A multi-attribute decision making (MADM) approach is used to rank DG technologies with respect to their economic, technical and environmental attributes. Base on the performed analysis, it is revealed that investors´ tendency toward renewable technologies will increase after this reform. Therefore environmental pollution, as one of the main reasons of this economic reform, will decrease.