Distribution network tariffs: A closed question?

Quantifying distribution-system operators' economic incentives to promote residential demand response

“…Such results further support a shift in focus towards signals that impact peak load and losses, especially since grid investments are directly affected by power losses and the maximum load levels reached. As pointed out by Rodríguez-Ortega et al (2008), operators' incurred costs for covering power losses are in the same order of magnitude as costs of grid investments. This means that if one or both of these factors are targeted via demand-response programs, grid infrastructure investments will be directly affected.…”

“…Tariff design is concerned with the allocation of network costs and the stimulus of appropriate incentives by establishing a process for determining who pays for what services and how much (Rodríguez-Ortega et al, 2008). Significant changes are expected in the current Swedish regulatory model for the coming 2016 to 2019 period based on the impact of distributed energy resources (Eurelectric, 2014).…”

“…Even if DR is able to reduce part of the load fluctuations, some peaks will still persist and those will ultimately determine the costs related to the peakcapacity charge. Peak demand has been and continues to be the main driver for network costs (Rodríguez-Ortega et al, 2008). In this way, distribution-system operators can 'buy' lower risk by increasing their maximum level of subscribed power or promoting consumption flexibility through demand-response programs.…”

“…Distribution-system operators incur costs at the connection point to the high-voltage transmission grid (P erez-Arriaga, 2013; Rodríguez-Ortega et al, 2008). In order to pass electricity from the transmission to the distribution grid, Swedish distributionsystem operators pay a 'feeding-grid' charge for the withdrawal from or injection to the grid.…”

Distribution pricing: theoretical principles and practical approaches

“…This means that a single charge for energy or power consumed cannot be defined; rather, this charge depends on the type of consumer and the time of day consumption takes place [1]. Tariff structure, in short, is meant to be a simplified version of reality.…”