Outage risk management for residential users considering distribution network reliability assessment: A P2P outage insurance approach

The increasing integration of renewable energy sources and the rising frequency of extreme weather events have exacerbated supply-demand imbalances and heightened power outage risks. To mitigate these risks for residential users, this paper proposes a P2P outage insurance mechanism. A chain reinsurance framework is established, involving system operators, insurance intermediaries, and residential users, based on a pool-type P2P insurance model, along with its associated business processes. Premiums are determined using the standard deviation principle, while outage losses in complex networks are calculated through a reliability assessment method based on two-way traversal search. Furthermore, a premium sharing mechanism within mutual aid groups is developed using the Shapley value, accounting for the heterogeneous outage risks and losses of different users. The feasibility and effectiveness of the proposed mechanism are validated using an IEEE-RBTS numerical example. Results demonstrate that the mechanism enables effective risk sharing and fair cost allocation, indirectly enhancing system reliability, while reducing premiums by 22 % compared to traditional insurance. Accurate reliability assessment can be realized for distribution networks with backup power and sub- feeders.