IDEAS home Printed from https://ideas.repec.org/a/eee/juipol/v70y2021ics0957178721000461.html
   My bibliography  Save this article

A smart meter data-driven distribution utility rate model for networks with prosumers

Author

Listed:
  • Venkatraman, Athindra
  • Thatte, Anupam A.
  • Xie, Le

Abstract

Distribution grids across the world are undergoing profound changes due to advances in energy technologies. Electrification of the transportation sector and the integration of Distributed Energy Resources (DERs), such as photo-voltaic panels and energy storage devices, have gained substantial momentum, especially at the grid edge. Transformation in the technological aspects of the grid could directly conflict with existing distribution utility retail tariff structures. We propose a smart meter data-driven rate model to recover distribution network-related charges, where the implementation of these grid-edge technologies is aligned with the interest of the various stakeholders in the electricity ecosystem. The model envisions a shift from charging end-users based on their KWh volumetric consumption, towards charging them a grid access fee that approximates the impact of end-users’ time-varying demand on their local distribution network. The proposed rate incorporates two cost metrics affecting distribution utilities (DUs), namely magnitude and variability of customer demand. The proposed rate can be applied to prosumers and conventional consumers without DERs.

Suggested Citation

  • Venkatraman, Athindra & Thatte, Anupam A. & Xie, Le, 2021. "A smart meter data-driven distribution utility rate model for networks with prosumers," Utilities Policy, Elsevier, vol. 70(C).
    • Handle: RePEc:eee:juipol:v:70:y:2021:i:c:s0957178721000461
    DOI: 10.1016/j.jup.2021.101212
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0957178721000461
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jup.2021.101212?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Axel Gautier & Julien Jacqmin & Jean-Christophe Poudou, 2018. "The prosumers and the grid," Journal of Regulatory Economics, Springer, vol. 53(1), pages 100-126, February.
    2. David P. Brown & David E. M. Sappington, 2017. "Optimal policies to promote efficient distributed generation of electricity," Journal of Regulatory Economics, Springer, vol. 52(2), pages 159-188, October.
    3. Severin Borenstein & James Bushnell, 2015. "The US Electricity Industry After 20 Years of Restructuring," Annual Review of Economics, Annual Reviews, vol. 7(1), pages 437-463, August.
    4. Cambini, Carlo & Soroush, Golnoush, 2019. "Designing grid tariffs in the presence of distributed generation," Utilities Policy, Elsevier, vol. 61(C).
    5. Passey, Robert & Haghdadi, Navid & Bruce, Anna & MacGill, Iain, 2017. "Designing more cost reflective electricity network tariffs with demand charges," Energy Policy, Elsevier, vol. 109(C), pages 642-649.
    6. Batlle, Carlos & Mastropietro, Paolo & Rodilla, Pablo, 2020. "Redesigning residual cost allocation in electricity tariffs: A proposal to balance efficiency, equity and cost recovery," Renewable Energy, Elsevier, vol. 155(C), pages 257-266.
    7. Michael G. Pollitt, 2018. "Electricity Network Charging in the Presence of Distributed Energy Resources: Principles, Problems and Solutions," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 1).
    8. Abdelmotteleb, Ibtihal & Gómez, Tomás & Chaves Ávila, José Pablo & Reneses, Javier, 2018. "Designing efficient distribution network charges in the context of active customers," Applied Energy, Elsevier, vol. 210(C), pages 815-826.
    9. Laws, Nicholas D. & Epps, Brenden P. & Peterson, Steven O. & Laser, Mark S. & Wanjiru, G. Kamau, 2017. "On the utility death spiral and the impact of utility rate structures on the adoption of residential solar photovoltaics and energy storage," Applied Energy, Elsevier, vol. 185(P1), pages 627-641.
    10. De Groote, Olivier & Pepermans, Guido & Verboven, Frank, 2016. "Heterogeneity in the adoption of photovoltaic systems in Flanders," Energy Economics, Elsevier, vol. 59(C), pages 45-57.
    11. Darghouth, Naïm R. & Wiser, Ryan H. & Barbose, Galen & Mills, Andrew D., 2016. "Net metering and market feedback loops: Exploring the impact of retail rate design on distributed PV deployment," Applied Energy, Elsevier, vol. 162(C), pages 713-722.
    12. Ross Baldick, 2018. "Incentive properties of coincident peak pricing," Journal of Regulatory Economics, Springer, vol. 54(2), pages 165-194, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chao-Chung Hsu & Bi-Hai Jiang & Chun-Cheng Lin, 2023. "A Survey on Recent Applications of Artificial Intelligence and Optimization for Smart Grids in Smart Manufacturing," Energies, MDPI, vol. 16(22), pages 1-15, November.
    2. Hu, Han-fen & Krishen, Anjala S. & Barnes, Jesse, 2023. "Through narratives we learn: Exploring knowledge-building as a marketing strategy for prosocial water reuse," Journal of Business Research, Elsevier, vol. 158(C).
    3. Vaughan, Jim & Doumen, Sjoerd C. & Kok, Koen, 2023. "Empowering tomorrow, controlling today: A multi-criteria assessment of distribution grid tariff designs," Applied Energy, Elsevier, vol. 341(C).
    4. Große-Kreul, Felix, 2022. "What will drive household adoption of smart energy? Insights from a consumer acceptance study in Germany," Utilities Policy, Elsevier, vol. 75(C).
    5. Junhyung Kim & Keon Baek & Eunjung Lee & Jinho Kim, 2023. "Analysis of Net-Metering and Cross-Subsidy Effects in South Korea: Economic Impact across Residential Customer Groups by Electricity Consumption Level," Energies, MDPI, vol. 16(2), pages 1-14, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Axel Gautier & Julien Jacqmin, 2020. "PV adoption: the role of distribution tariffs under net metering," Journal of Regulatory Economics, Springer, vol. 57(1), pages 53-73, February.
    2. Saumweber, Andrea & Wederhake, Lars & Cardoso, Gonçalo & Fridgen, Gilbert & Heleno, Miguel, 2021. "Designing Pareto optimal electricity retail rates when utility customers are prosumers," Energy Policy, Elsevier, vol. 156(C).
    3. Niels Govaerts & Kenneth Bruninx & Hélène Le Cadre & Leonardo Meeus & Erik Delarue, 2021. "Forward-looking distribution network charges considering lumpy investments," Journal of Regulatory Economics, Springer, vol. 59(3), pages 280-302, June.
    4. Hoarau, Quentin & Perez, Yannick, 2019. "Network tariff design with prosumers and electromobility: Who wins, who loses?," Energy Economics, Elsevier, vol. 83(C), pages 26-39.
    5. Morell-Dameto, Nicolás & Chaves-Ávila, José Pablo & Gómez San Román, Tomás & Schittekatte, Tim, 2023. "Forward-looking dynamic network charges for real-world electricity systems: A Slovenian case study," Energy Economics, Elsevier, vol. 125(C).
    6. Miguel Manuel de Villena & Raphael Fonteneau & Axel Gautier & Damien Ernst, 2019. "Evaluating the Evolution of Distribution Networks under Different Regulatory Frameworks with Multi-Agent Modelling," Energies, MDPI, vol. 12(7), pages 1-15, March.
    7. Nicolás Morell Dameto & José Pablo Chaves-Ávila & Tomás Gómez San Román, 2020. "Revisiting Electricity Network Tariffs in a Context of Decarbonization, Digitalization, and Decentralization," Energies, MDPI, vol. 13(12), pages 1-21, June.
    8. Hennig, Roman J. & Ribó-Pérez, David & de Vries, Laurens J. & Tindemans, Simon H., 2022. "What is a good distribution network tariff?—Developing indicators for performance assessment," Applied Energy, Elsevier, vol. 318(C).
    9. Axel Gautier & Julien Jacqmin & Jean-Christophe Poudou, 2018. "The prosumers and the grid," Journal of Regulatory Economics, Springer, vol. 53(1), pages 100-126, February.
    10. Bruno Moreno Rodrigo de Freitas, 2020. "Quantifying the effect of regulated volumetric electriciy tariffs on residential PV adoption under net metering scheme," Working papers of CATT hal-02976874, HAL.
    11. Moncada, J.A. & Tao, Z. & Valkering, P. & Meinke-Hubeny, F. & Delarue, E., 2021. "Influence of distribution tariff structures and peer effects on the adoption of distributed energy resources," Applied Energy, Elsevier, vol. 298(C).
    12. Li, Na & Hakvoort, Rudi A. & Lukszo, Zofia, 2021. "Cost allocation in integrated community energy systems - A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 144(C).
    13. Beaufils, Timothé & Pineau, Pierre-Olivier, 2019. "Assessing the impact of residential load profile changes on electricity distribution utility revenues under alternative rate structures," Utilities Policy, Elsevier, vol. 61(C).
    14. Govaerts, Niels & Bruninx, Kenneth & Le Cadre, Hélène & Meeus, Leonardo & Delarue, Erik, 2019. "Spillover effects of distribution grid tariffs in the internal electricity market: An argument for harmonization?," Energy Economics, Elsevier, vol. 84(C).
    15. Vaughan, Jim & Doumen, Sjoerd C. & Kok, Koen, 2023. "Empowering tomorrow, controlling today: A multi-criteria assessment of distribution grid tariff designs," Applied Energy, Elsevier, vol. 341(C).
    16. Avau, Michiel & Govaerts, Niels & Delarue, Erik, 2021. "Impact of distribution tariffs on prosumer demand response," Energy Policy, Elsevier, vol. 151(C).
    17. Morell-Dameto, Nicolás & Chaves-Ávila, José Pablo & Gómez San Román, Tomás & Dueñas-Martínez, Pablo & Schittekatte, Tim, 2024. "Network tariff design with flexible customers: Ex-post pricing and a local network capacity market for customer response coordination," Energy Policy, Elsevier, vol. 184(C).
    18. Bruno Moreno Rodrigo de Freitas, 2020. "Quantifying the effect of regulated volumetric electriciy tariffs on residential PV adoption under net metering scheme," Working Papers hal-02976874, HAL.
    19. Spiller, Elisheba & Esparza, Ricardo & Mohlin, Kristina & Tapia-Ahumada, Karen & Ünel, Burçin, 2023. "The role of electricity tariff design in distributed energy resource deployment," Energy Economics, Elsevier, vol. 120(C).
    20. Say, Kelvin & John, Michele & Dargaville, Roger & Wills, Raymond T., 2018. "The coming disruption: The movement towards the customer renewable energy transition," Energy Policy, Elsevier, vol. 123(C), pages 737-748.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:juipol:v:70:y:2021:i:c:s0957178721000461. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.sciencedirect.com/journal/utilities-policy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.