Driven by the need for sustainable and efficient energy systems, the optimal management of distributed generation, including photovoltaic systems and battery energy storage systems within prosumer households, is of crucial importance. This requires a comprehensive cost–benefit analysis to assess their viability. In this study, an optimization model formulated as a mixed-integer linear programming problem is proposed to evaluate the integration of battery storage systems for 10 prosumers on the radial feeder in Croatia and to quantify the benefits both from the prosumers’ perspective and that of the reduction in grid losses. The results show significant annual cost reductions for prosumers, totaling EUR 1798.78 for the observed feeder, with some achieving a net profit. Grid losses are significantly reduced by 1172.52 kWh, resulting in an annual saving of EUR 216.25 for the distribution system operator. However, under the current Croatian market conditions, the integration of battery storage systems is not profitable over the entire lifetime due to the high initial investment costs of EUR 720/kWh. The break-even analysis reveals that investment cost needs to decrease by 52.78%, or an inflation rate of 4.87% is required, to reach prosumer profitability. This highlights the current financial barriers to the widespread adoption of battery storage systems and emphasizes the need for significant cost reductions or targeted incentives.

The transition toward capacity-based network tariffs shifts the primary role of battery energy storage systems (BESS) from traditional energy arbitrage to active peak shaving. This paper presents a mixed-integer linear programming (MILP) optimization model for the co-optimization of both BESS size and operation scheduling for multiple prosumers operating individually and within energy community (EC). The model accounts for battery cyclic degradation and reduces the state of health (SOH) over the project lifetime. The framework is evaluated by a comprehensive techno-economic analysis of BESS integration under Slovenia’s multi-block tariff structure. The results demonstrate that while individual distributed BESS integration is highly profitable, centralized EC BESS financially underperforms. Because centralized BESS cannot directly reduce individual contracted power limits, its profitability relies on energy arbitrage, making the initial investment and double grid fees the primary barriers. Conversely, integrating distributed storage with peer-to-peer (P2P) trading minimizes the required BESS capacity while maintaining profitability. The evaluation also reveals that ECs do not automatically act as socio-economic equalizers, indicated by a stable Gini coefficient. However, a break-even analysis reveals the necessary reduction in capital costs to overcome these hurdles, confirming the strong future viability of centralized EC BESS.

The transition toward capacity-based network tariffs shifts the primary role of battery energy storage systems (BESS) from traditional energy arbitrage to active peak shaving. This paper presents a mixed-integer linear programming (MILP) optimization model for the co-optimization of both BESS size and operation scheduling for multiple prosumers operating individually and within an energy community (EC). Battery aging is accounted for in the optimization model through the state of health (SOH). The framework is evaluated by a comprehensive techno-economic analysis of BESS integration under Slovenia’s multi-block tariff structure. The results demonstrate that while individual distributed BESS integration is highly profitable, centralized EC BESS financially underperforms. Because centralized BESS cannot directly reduce individual contracted power limits, its profitability relies on energy arbitrage, making the initial investment and double grid fees the primary barriers. Conversely, integrating distributed storage with peer-to-peer (P2P) trading minimizes the required BESS capacity while maintaining profitability. The evaluation also reveals that ECs do not automatically act as socio-economic equalizers, indicated by a stable Gini coefficient. However, a break-even analysis reveals the necessary reduction in capital costs to overcome these hurdles, confirming the strong future viability of centralized EC BESS.