Optimal design and cost allocation of a distributed energy resource (DER) system with district energy networks: A case study of an isolated island in the South China Sea

District energy networks have typically been regarded as effective for improving the efficiency of energy systems. With the rapid development of distributed energy resource systems, district energy networks have acquired new significance because they reduce the peak demand of a district via the simultaneous management of several distributed energy resource systems, which is specifically the case for isolated islands where intermittent renewable energy has the potential to contribute a larger share to energy generation and supply. This article presents a mixed integer linear programming model for optimizing the structure and operation of a distributed energy resource system with district energy networks on a virtual island in the South China Sea. A cost allocation analysis based on cooperative game theory is performed to distribute the system cost between individual stakeholders. The results highlight that the energy networks effectively reduce the system cost. The imbalance between the energy supply and demand at each site, together with the distances between different sites, affects the network layout to a large extent. Overall, the application of district energy networks decreases the system cost by 3.33%.