 Peak shifting and cross-class subsidization: The impacts of solar PV on changes in electricity costsErik Johnson, Ross Beppler, Chris Blackburn, Benjamin Staver, Marilyn Brown and Daniel Matisoff Energy Policy, 2017, vol. 106, issue C, 436-444 Abstract: The expansion of distributed solar necessitates additional research into the impacts on both utilities and their customers. In this paper we use New Jersey solar data, PJM market data, and demand profiles from a PJM utility to investigate rate and bill impacts of large-scale solar penetration. In addition to the subsidization of solar adopters by non-participants, we highlight the channels through which cross-subsidization of rate classes can arise in practice. The results of our study indicate that the fear of a utility “death spiral” may be exaggerated. Significant solar can be incorporated with only a 2% increase in non-participant bills. At high levels of penetration, distributed solar has the potential to alter the system peak hour which affects the allocation of costs across rate-classes. As the peak hour shifts to the evening when solar production diminishes, residential customers face higher distribution costs. Policy makers and utilities need to be aware of these challenges in designing the next generation of rates that are better aligned with cost causality. Keywords: Solar electricity; Net energy metering; Distributed generation; Electricity rate design (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:106:y:2017:i:c:p:436-444 DOI: 10.1016/j.enpol.2017.03.034 Access Statistics for this article Energy Policy is currently edited by N. France More articles in Energy Policy from Elsevier |
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