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    Future-proof tariff design: Recovering sunk grid costs in a world where consumers are pushing back

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    Publication type
    Working paper
    Author
    Schittekatte, Tim
    Momber, Ilan
    Meeus, Leonardo
    Publication Year
    2017
    Publication Number of pages
    29
    
    Metadata
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    Abstract
    Traditional analysis of distribution grid user’s reaction to tariffs assumes a low price sensitivity and a lack of alternative technologies to grid connection. This is radically changing with two technology breakthroughs: (1) Photovoltaics (PV) enable domestic and commercial consumers to self-produce energy; (2) Batteries allow self-producers to set both their grid energy and capacity parameters. Contributing to the state of the art, the grid cost recovery problem is modelled as a non-cooperative game between consumers. In this game, the availability and costs of new technologies (such as PV and batteries) strategically interact with tariff structures. Four states of the world for user’s access to new technologies are distinguished and three tariff structures are evaluated. The assessed distribution network tariff structures are: energy volumetric charges with net-metering, energy volumetric charges for both injection and withdrawal, and capacity-based charges. Results show that the new distribution world -open by new technology choices for grid users- is highly interactive and threatens grid regulation not understanding it.
    Keyword
    Batteries, Bi-level Modelling, Distributed Energy Adoption, Distribution Network Tariff Design, Non-cooperative Behaviour
    Knowledge Domain/Industry
    Entrepreneurship
    Special Industries : Energy
    URI
    http://hdl.handle.net/20.500.12127/5980
    Other links
    http://cadmus.eui.eu/bitstream/handle/1814/46044/RSCAS_2017_22.pdf?sequence=1&isAllowed=y
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