Abstract:
The regulation of Distributed Energy Resources (DERs) has cast doubt on the
sustainability of utility business models. The impact of net-metering, and network
charge rebates for distributed generation (DG) have been questioned because of the
cross-subsidies that result between passive consumers and DG investors. Besides DG
investors, other new entrants such as owners of energy storage resources and
electrical vehicles are creating challenges for the regulation of distribution service
pricing.
This work addresses the debate by comparing several different distribution network
pricing models from the literature. It suggests modifications to these methodologies to
adapt them as we transition from a distribution sector comprising passive users to one
in which users are active agents. It considers the design principles governing each
tariff, from the perspective of simplicity, economic signalling, and revenue
reconciliation.
Results are presented of simulations performed with different arrangements of
alternative energy generators and energy stores, using an actual feeder from a
distribution company in Brazil. An analysis of these results is provided that suggests a
combination of locational and time-of-use rates can provide effective economic signals
to these new types of system user.
