Grid tariff designs coping with the challenges of electrification and their socio-economic impacts

Philipp Andreas Gunkel, Claire-Marie Bergaentzl\'e, Dogan Keles, Fabian Scheller and Henrik Klinge Jacobsen
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Philipp Andreas Gunkel: Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark
Claire-Marie Bergaentzl\'e: Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark
Dogan Keles: Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark
Fabian Scheller: Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark

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Abstract: This paper investigates volumetric grid tariff designs under consideration of different pricing mechanisms and resulting cost allocation 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.

Date: 2022-10, Revised 2023-08
New Economics Papers: this item is included in nep-ene and nep-reg
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