Distribution transformer cost evaluation methodology incorporating environmental cost

As system investment and energy costs continue to increase, electric utilities are increasingly interested in installing energy-efficient transformers at their distribution networks. The cost evaluation of transformers is based on total owning cost (TOC) method that includes transformer purchasing price and cost of transformer losses. Similar to energy cost, greenhouse gas (GHG) emissions are also assigned a price by energy markets. That is why this study proposes an innovative distribution transformer cost evaluation methodology (DTCEM) by introducing the environmental cost (EC) into the conventional TOC method. This EC is due to GHG emissions associated with supplying transformer losses. The proposed method is applied for economic evaluation of distribution transformers for the Hellenic power system and the results are compared to the conventional TOC, indicating the importance of incorporating EC into transformer economic evaluation. A sensitivity analysis is carried out, investigating the impact of various parameters involved in the proposed DTCEM.