Prosumage of solar electricity: Tariff design, capacity investments, and power sector effects

Claudia Günther, Wolf-Peter Schill and Alexander Zerrahn

Energy Policy, 2021, vol. 152, issue C

Abstract: We analyze how tariff design incentivizes households to invest in residential photovoltaic and battery storage systems, and explore selected electricity sector effects. To this end, we develop an open-source electricity sector model that explicitly features prosumage agents and apply it to German 2030 scenarios. Results show that lower feed-in tariffs substantially reduce investments in residential photovoltaics, yet optimal battery sizing and self-generation are relatively robust. With increasing fixed parts of retail tariffs and, accordingly, lower volumetric retail rates for grid consumption, households have lower incentives for self-consumption. As a consequence, optimal battery capacities and self-generation are smaller, and households contribute more to non-energy power sector costs. A cap on hourly feed-in by households may relieve distribution grid stress without compromising PV expansion or prosumage models for households. When choosing tariff designs, policy makers should not aim to (dis-)incentivize prosumage as such, but balance effects on renewable capacity expansion and system cost contribution.

Keywords: Prosumage; Retail tariff; Feed-in tariff; Photovoltaics; Battery storage; Renewable energy (search for similar items in EconPapers)
JEL-codes: C61 Q41 Q42 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Journal Article: Prosumage of solar electricity: Tariff design, capacity investments, and power sector effects (2021)
Journal Article: Prosumage of solar electricity: Tariff design, capacity investments, and power sector effects (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:152:y:2021:i:c:s0301421521000379

DOI: 10.1016/j.enpol.2021.112168

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