Just published! Future-proof tariff design | FSR Working Paper

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

Authors: MEEUS Leonardo, MOMBER Ilan, SCHITTEKATTE Tim

New Working Paper from FSR Energy

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 modeled 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.

Download the working paper


More on Electricity

Energy communities: Legal challenges for consumers and investors protection
Energy communities: Legal challenges for consumers and investors protection

The expression energy community and its numerous variations refer to collective action in the field of energy, mostly associated with…

Peer-to-peer electricity trading, Disintermediation and Platform liability
Peer-to-peer electricity trading, Disintermediation and Platform liability

Legal Challenges for consumer and prosumer protection The decentralisation of renewable energy production combined with the digitalisation of the electricity…

P2P Energy Trading: Legal Challenges for Data Management and Data Protection
P2P Energy Trading: Legal Challenges for Data Management and Data Protection

Peer-to-Peer Energy Trading, Digitalization, and Data In Peer-to-Peer (P2P) energy trading, the prosumers engage directly with each other using a…

Join our community

To meet, discuss and learn in the channel that suits you best.

scroll

top