A feasibility study on a regional energy business

Abstract

In Japan, the liberalization of the electricity retail market is starting in April 2016. Consumers will be able to choose the retail electric suppliers from which to buy. In Germany which domestic electricity market was fully liberalized in 1998, Stadt Werke (local power companies) has maintained more than 20% of the retail electric market share. We studied the feasibility of a regional energy business in which a isolated energy network system can be deployed. The result shows that if regional energy companies sell only electricity, expenditures are larger than the revenues; therefore, the business balance becomes negative. However, when regional energy companies can reach the total overall energy efficiency levels as high as 80% by adding heat supply to selling electricity, revenue can be balanced to the total cost and the energy companies can run as a profitable energy supply business, even in the small community business area.