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Network tariff design with prosumers and electromobility: Who wins, who loses?

Quentin Hoarau and Yannick Perez ()

Energy Economics, 2019, vol. 83, issue C, 26-39

Abstract: Distributed Energy Resources (DERs), mostly in the form of solar photovoltaic (PV) or lithium-ion batteries, and electric vehicles (EVs) are emerging as three disruptive innovations in power grids. Recent studies have pointed out the potential synergies between these technologies, while others have studied the difficulty to design adequate network tariff when some consumers can adopt DERs (prosumers). In this paper, we investigate the combined effect of DERs and EVs on grid cost recovery. To study these effects, we formulate a non-cooperative game between a regulator that sets tariffs to recover grid costs and the four classes of network users depending on whether they are prosumer (resp. EV owners) or not. We study how tariff structures and the levels of EV penetration and prosuming affect tariffs. First, we find that grid cost recovery concerns caused by load-defecting prosumers installing DER can be balanced by the diffusion of EVs in the network. Second, we highlight that EVs and DERs adoptions are conflicting through the network tariff design. In particular, we find that the more a tariff structure gives incentives for DERs, the less beneficial it is for EVs.

Keywords: Electric vehicle; Prosumers; Distributed energy resources; Tariff design; Distribution grid (search for similar items in EconPapers)
JEL-codes: C7 L94 L97 Q41 Q42 Q52 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
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Working Paper: Network tariff design with prosumers and electromobility: Who wins, who loses? (2019)
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DOI: 10.1016/j.eneco.2019.05.009

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Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

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