Abstract Distribution systems are undergoing significant changes as they evolve toward the grids of the future, which are known as smart grids (SGs). The perspective of SGs is to facilitate large-scale penetration of distributed generation using renewable energy sources (RESs), encourage the efficient use of energy, reduce systems’ losses, and improve the quality of power. Photovoltaic (PV) systems have become one of the most promising RESs due to the expected cost reduction and the increased efficiency of PV panels and interfacing converters. The ability to forecast power-production information accurately and reliably is of primary importance for the appropriate management of an SG and for making decisions relative to the energy market. Several forecasting methods have been proposed, and many indices have been used to quantify the accuracy of the forecasts of PV power production. Unfortunately, the indices that have been used have deficiencies and usually do not directly account for the economic consequences of forecasting errors in the framework of liberalized electricity markets. In this paper, advanced, more accurate indices are proposed that account directly for the economic consequences of forecasting errors. The proposed indices also were compared to the most frequently used indices in order to demonstrate their different, improved capability. The comparisons were based on the results obtained using a forecasting method based on an artificial neural network. This method was chosen because it was deemed to be one of the most promising methods available due to its capability for forecasting PV power. Numerical applications also are presented that considered an actual PV plant to provide evidence of the forecasting performances of all of the indices that were considered.