Distribution network prices and solar PV: Resolving rate instability and wealth transfers through demand tariffs

Energy Economics

Volumn 54, Issue , 2016, Pages 108-122

  Simshauser, Paul ^a  

^a GRIFFITH UNIVERSITY   (Australia)

Author keywords

Demand tariffs; Electricity prices; Electricity utilities

Indexed keywords

EARNINGS; ELECTRIC UTILITIES;

DEMAND TARIFFS; ELECTRICITY DISTRIBUTION NETWORKS; ELECTRICITY PRICES; HOUSEHOLD LOADS; PRICING STRUCTURES; PRODUCTION PEAKS; RATE OF RETURN; WEALTH TRANSFER;

COSTS;

ALTERNATIVE ENERGY; DEMAND ANALYSIS; ELECTRICITY GENERATION; ELECTRICITY SUPPLY; RENEWABLE RESOURCE; SOLAR POWER; TARIFF STRUCTURE;

AUSTRALIA; QUEENSLAND;

EID: 84951869339     PISSN: 01409883     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.eneco.2015.11.011     Document Type: Article

References (72)

1. Ambrose M.D., James M., Law A., Osman P., White S. The Evaluation of the 5-Star Energy Efficiency Standard for Residential Buildings 2013, CSIRO, Australia.
2. Aspinall M., Christiansen C., Lampard M. Power Pricing Internationally-Learnings for Australia 2014, AECOM Publication, Melbourne.
3. Averch H., Johnson L. Behaviour of the Firm Under Regulatory Constraint. Am. Econ. Rev. 1962, 52(5):1052-1069.
4. Berrie T. The economics of system planning in bulk electricity supply. Electr. Rev. 1967, 22:425-428.
5. Boiteux M. La tarification des demandes en pointe: application de la theorie de la vente au cout margina. Rev. Gen. Electr. 1949, 58:321-340.
6. Boiteux M. Peak load pricing. J. Bus. 1960, 33(2):157-180. Translated by H. Izzard in Journal of Business.
7. Boiteux M. La vente au cout marginal. Rev. Fr. Energ. 1956, 8(81):113-117.
8. Nelson J. The determination of costs of expansion of an interconnected system of production and distribution of electricity. Marginal Cost Pricing in Practice 1964, Translated in, Prentice Hall Inc., Englewood Cliffs.
9. Boiteux M., Stasi P. Sur la determination des prix de revient de developpement dans un systeme interconnecte de production-distribution. Union Int. Prod. Distrib. Energ. Electr. 1952, VI(10):1-35.
10. Nelson J. The determination of costs of expansion of an interconnected system of production and distribution of electricity. Marginal Cost Pricing in Practice 1964, Translated in, Prentice Hall Inc., Englewood Cliffs.
11. Bonbright J. Principles of Public Utility Rates 1961, Columbia University Press, New York.
12. Bonbright J., Danielsen A., Kamerschen D. Principles of Public Utility Rates 1988, Public Utilities Reports Inc., Arlington Virginia. Second edition.
13. Borenstein S. Effective and equitable adoption of opt-in residential dynamic electricity pricing. Rev. Ind. Organ. 2013, 42(2013):127-160.
14. Brown T., Faruqui A. Structure of Electricity Distribution Network Tariffs: Recovery of Residual Costs 2014, The Brattle Group, San Francisco.
15. Burtt D., Dargusch P. The cost-effectiveness of household photovoltaic systems in reducing greenhouse gas emissions in Australia: linking subsidies with emission reductions. Appl. Energy 2015, 148(2015):439-448.
16. Clark J.M. Rates for public utilities. Am. Econ. Rev. 1911, 1(3):473-487.
17. Coase R. The marginal cost controversy. Economica 1946, 13(51):169-182.
18. Crawford G. Written Down Value? 2014, Energy Networks Publication, Canberra.
19. Crew M., Kleindorfer P. Peak load pricing with a diverse technology. Bell J. Econ. 1976, 7(1):207-231.
20. Doherty H. Equitable, uniform and competitive rates. Proceedings of National Electric Light Association, May 1900 1900, 53-79.
21. The Development of Scientific Rates for Electricity Supply Reprints of Selected Original Rate Papers 1915, republished in:, The Edison Illuminating Company of Detroit.
22. Dusonchet L., Telaretti E. Comparative economic analysis of support policies for solar PV in the most representative EU countries. Renew. Sustain. Energy Rev. 2015, 42(2015):986-998.
23. Energex Solar PV Generation in Southeast Queensland 2015, Energex Publication, Brisbane.
24. Energex, Ergon Are Queensland residents willing and able to respond to time-varying electricity prices?. Aust. Econ. Rev. 2014, 47(3):324-346.
25. Faruqui A. The ethics of dynamic pricing. Electr. J. 2010, 23(6):13-27.
26. Faruqui A. Residential dynamic pricing and energy stamps. Regulation 2010, 4-5. (Winter).
27. Faruqui A., Malko J. The residential demand for electricity by time-of-use: a survey of 12 experiments with peak load pricing. Energy 1983, 8(10):781-795.
28. Faruqui A., Palmer J. Dynamic pricing and its discontents. Regulation 2011, 16-22. (Fall).
29. Faruqui A., Sergici S. Household response to dynamic pricing of electricity: a survey of 15 experiments. J. Regul. Econ. 2010, 38(2):194-225.
30. Faruqui A., Sergici S. Arcturus: international evidence on dynamic pricing. Electr. J. 2013, 26(7):55-66.
31. Faruqui A., Hledik R., Neenan B. Rethinking Rate Design. A Survey of Leading Issues in California 2007, prepared for, Demand Response Research Center, Berkley.
32. Faruqui A., Sergici S., Sharif A. The impact of informational feedback on energy consumption-a survey of the experimental evidence. Energy 2010, 35(4):1598-1608.
33. Felder F. The practical equity implications of advanced metering infrastructure. Electr. J. 2010, 23(6):56-64.
34. Fenwick S., Getachew L., Ivanov C., Smith J. Demand impact of a critical peak pricing program: opt-in and opt-out options, green attitudes and other customer characteristics. Energy J. 2014, 35(3):1-24.
35. Frondel M., Schmidt C., Vance C. Revisiting Germany's Solar Cell Promotion: an unfolding disaster. Econ. Anal. Policy 2014, 44(1):3-13.
36. Greene W. A method of calculating the cost of furnishing electric current and a way of selling it. Electr. World 1896, 23:222-228. (Feb).
37. The Development of Scientific Rates for Electricity Supply Reprints of Selected Original Rate Papers 1915, republished in:, The Edison Illuminating Company of Detroit.
38. Hanser P. "Commonwealth Edison Company: Rebuttal Testimony of Philip Q. Hanser", Docket Number 13-0387 CommEd. 10.0 2013, State of Illinois, Illinois Commerce Commission.
39. Hausman W., Neufeld J. Engineers and economists: historical perspectives on the pricing of electricity. Technol. Cult. 1989, 30(1):83-104.
40. Hirth L. The market value of solar photovoltaics: is solar power cost-competitive?. IET Renew. Power Gener. 2015, 9(1):37-45.
41. Hledik R. Rediscovering residential demand charges. Electr. J. 2014, 27(7):82-96.
42. Honghang S., Qiang Z., Yanxi L., Yurui Z., Jun S. China's solar photovoltaic policy: an analysis based on policy instruments. Appl. Energy 2014, 129(2014):308-319.
43. Hopkinson J. On the cost of electric supply. Trans. Jr. Eng. Soc. 1892, 3(1):1-14.
44. The Development of Scientific Rates for Electricity Supply Reprints of Selected Original Rate Papers 1915, The Edison Illuminating Company of Detroit.
45. Horowitz S., Lave L. Equity in Residential Electricity Pricing. Energy J. 2014, 35(2).
46. Hotelling H. The general welfare in relation to problems of taxation and of railway and utility rates. Econ. A 1938, 6(3):242-269.
47. Houthakker H. Electricity tariffs in theory & practice. Econ. J. 1951, 61(241):1-25.
48. Ito K. Do consumers respond to average or marginal price? Evidence from nonlinear electricity pricing. Am. Econ. Rev. 2014, 104(2):537-563.
49. Joskow P. Contributions to the theory of marginal cost pricing. Bell J. Econ. 1976, 7(1):197-206.
50. Kahn A. The Economics of Regulation: Volume 1 - Economic Principles 1970, Wiley, New York.
51. Kahn A. The Economics of Regulation: Volume 2 - Institutional Issues 1971, Wiley, New York.
52. Lewis A. The two-part tariff. Economica 1941, 8(31):249-270.
53. Nelson J. Marginal Cost Pricing in Practice 1964, (Ed.), Prentice Hall Inc., Englewood Cliffs.
54. Nelson T., Orton F. A new approach to congestion pricing in electricity markets: improving user pays pricing incentives. Energy Econ. 2013, 40(C):1-7.
55. Nelson T., Simshauser P., Nelson J. Queensland solar feed-in tariffs and the merit order effect: economic benefit, or regressive taxation and wealth transfers?. J. Econ. Anal. Policy 2012, 42(3):277-301.
56. Ng K. Equity, efficiency and financial viability: public-utility pricing with special reference to water supply. Aust. Econ. Rev. 1987, 20(3):21-35.
57. Procter R. Integrating time-differentiated rates, demand response and smart grid to manage power system costs. Electr. J. 2013, 26(3):50-60.
58. Severance C. A practical, affordable (and least business risk) plan to achieve 80% clean electricity by 2035. Electr. J. 2011, 24(6):8-26.
59. Simshauser P. Resource adequacy, capital adequacy and investment uncertainty in the Australian power market, Electr. J. 2010, 23(1):67-84.
60. Simshauser P. From first place to last: the National Electricity Market's policy-induced 'energy market death spiral'. Aust. Econ. Rev. 2014, 47(4):540-562.
61. Simshauser P., Downer D. Dynamic pricing and the peak electricity load problem. Aust. Econ. Rev. 2012, 45(3):305-324.
62. Simshauser P., Downer D. On the inequity of flat-rate electricity tariffs. Energy J. 2015, 37(3):199-229.
63. Steiner P. Peak loads and efficient pricing. Q. J. Econ. 1957, 71(4):585-610.
64. Sun P., Nie P. A comparative study of feed-in tariffs and renewable portfolio standard policy in renewable energy industry. Renew. Energy 2015, 74(2015):255-262.
65. Turvey R. Marginal cost pricing in practice. Economica 1964, 31(124):426-432.
66. Turvey R. Peak-load pricing. J. Polit. Econ. 1968, 76(1):101-113.
67. Watkins G.P. Electrical Rates 1921, Van Nostrand Company, New York.
68. Wenders J. Peak load pricing in the electric utility industry. Bell J. Econ. 1976, 7(1):232-241.
69. Williamson O. Peak-load pricing and optimal capacity under indivisibility constraints. Am. Econ. Rev. 1966, 56(4):810-827.
70. Wood L., Faruqui A. Dynamic pricing and low-income customers. Public Util. Fortnightly 2010, 2010:60-64. (November).
71. Wright A. Cost of Electricity Supply 1896, 1-8. Municipal Electrical Association-Whitehall England, (June).
72. The Development of Scientific Rates for Electricity Supply Reprints of Selected Original Rate Papers 1915, The Edison Illuminating Company of Detroit.