Grid tariff designs to address electrification and their allocative impacts

Philipp Andreas Gunkel, Claire-Marie Bergaentzlé, Dogan Keles, Fabian Scheller and Henrik Klinge Jacobsen

Utilities Policy, 2023, vol. 85, issue C

Abstract: This paper investigates volumetric grid tariff designs considering different pricing mechanisms and resulting in cost-allocative impacts across socio-techno-economic consumer categories. In a case study of 1.56 million Danish households divided into 90 socio-techno-economic categories, we compare three alternative grid tariffs and investigate their impact on annual electricity bills. The results of our design, consisting of a time-dependent threshold penalizing individual peak consumption and a system peak tariff, show (a) a range of different allocations that distribute the burden of additional grid costs across both technologies and (b) strong positive outcomes, including reduced expenses for lower-income groups and smaller households.

Keywords: Electricity grid tariffs; Electrification; Network cost distribution (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:85:y:2023:i:c:s0957178723001881

DOI: 10.1016/j.jup.2023.101676

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