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The impact of PVs and EVs on Domestic Electricity Network Charges: a case study from Great Britain

Author

Listed:
  • Sinan Küfeoglu

    (Energy Policy Research Group University of Cambridge)

  • Michael Pollitt

    (Energy Policy Research Group University of Cambridge)

Abstract

Electric power distribution network charges have become a popular area of study for regulators, industry and academia. Increasing use of photovoltaics (PVs) and electric vehicles (EVs) by domestic customers has created concerns about the fairness of the current tariff structure. Proposing a tariff design, which will be cost reflective, transparent, sustainable, economically efficient is socially desirable. Wealth transfer through electricity distribution tariffs is a major concern for energy regulators. This paper aims to analyse the current distribution network tariffs faced by four main household customer groups in Great Britain (GB) - defined as those who own a PV and an EV, those with EV but no PV, those with PV but no EV and finally those with neither EV nor PV – under various uptake scenarios for EVs and PVs. We illustrate the impact on household tariffs for the most and least expensive GB network operators, namely London Power Networks and Scottish Hydro Electric Power Distribution. The results show that, due to the current network charges calculation structure, as PV penetration increases, the distribution tariffs increase for all customers regardless of whether someone owns a PV or not. On the other hand, as EV penetration increases, the distribution tariffs decrease for all customer groups. Another key finding is that the distribution tariffs in Great Britain are EV dominated and the future EV and PV penetration projections indicate that the distribution tariffs will likely decrease for all customers in Great Britain.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Sinan Küfeoglu & Michael Pollitt, 2018. "The impact of PVs and EVs on Domestic Electricity Network Charges: a case study from Great Britain," Working Papers EPRG 1814, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    • Handle: RePEc:enp:wpaper:eprg1814
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    Cited by:

    1. Freitas Gomes, Icaro Silvestre & Perez, Yannick & Suomalainen, Emilia, 2021. "Rate design with distributed energy resources and electric vehicles: A Californian case study," Energy Economics, Elsevier, vol. 102(C).
    2. Bustos, Cristian & Watts, David & Olivares, Daniel, 2019. "The evolution over time of Distributed Energy Resource’s penetration: A robust framework to assess the future impact of prosumage under different tariff designs," Applied Energy, Elsevier, vol. 256(C).
    3. Wadim Strielkowski & Elena Volkova & Luidmila Pushkareva & Dalia Streimikiene, 2019. "Innovative Policies for Energy Efficiency and the Use of Renewables in Households," Energies, MDPI, vol. 12(7), pages 1-17, April.
    4. Rehman, Anis Ur & Lu, Junwei & Du, Bo & Bai, Feifei & Sanjari, Mohammad J., 2025. "Efficient Management of Electric Vehicle Charging Stations: Balancing user preferences and grid demands with energy storage systems and renewable energy," Applied Energy, Elsevier, vol. 393(C).
    5. Hoarau, Quentin & Perez, Yannick, 2019. "Network tariff design with prosumers and electromobility: Who wins, who loses?," Energy Economics, Elsevier, vol. 83(C), pages 26-39.
    6. Bert Willems & Juulia Zhou, 2020. "The Clean Energy Package and Demand Response: Setting Correct Incentives," Energies, MDPI, vol. 13(21), pages 1-19, October.
    7. Heymann, Fabian & Miranda, Vladimiro & Soares, Filipe Joel & Duenas, Pablo & Perez Arriaga, Ignacio & Prata, Ricardo, 2019. "Orchestrating incentive designs to reduce adverse system-level effects of large-scale EV/PV adoption – The case of Portugal," Applied Energy, Elsevier, vol. 256(C).
    8. Vaughan, Jim & Doumen, Sjoerd C. & Kok, Koen, 2023. "Empowering tomorrow, controlling today: A multi-criteria assessment of distribution grid tariff designs," Applied Energy, Elsevier, vol. 341(C).
    9. Freitas Gomes, Icaro Silvestre & Perez, Yannick & Suomalainen, Emilia, 2020. "Coupling small batteries and PV generation: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 126(C).
    10. Manuel de Villena, Miguel & Jacqmin, Julien & Fonteneau, Raphael & Gautier, Axel & Ernst, Damien, 2021. "Network tariffs and the integration of prosumers: The case of Wallonia," Energy Policy, Elsevier, vol. 150(C).
    11. Biancardi, Andrea & Di Castelnuovo, Matteo & Staffell, Iain, 2021. "A framework to evaluate how European Transmission System Operators approach innovation," Energy Policy, Elsevier, vol. 158(C).
    12. Collier, Samuel H.C. & House, Jo I. & Connor, Peter M. & Harris, Richard, 2023. "Distributed local energy: Assessing the determinants of domestic-scale solar photovoltaic uptake at the local level across England and Wales," Renewable and Sustainable Energy Reviews, Elsevier, vol. 171(C).
    13. Donato A. Melchiorre. & Sinan Küfeoglu, 2018. "Economic Assessment of Using Electric Vehicles and Batteries as Domestic Storage Units in the United Kingdom," Cambridge Working Papers in Economics 1858, Faculty of Economics, University of Cambridge.
    14. Giulietti, Monica & Le Coq, Chloé & Willems, Bert & Anaya, Karim, 2019. "Smart Consumers in the Internet of Energy : Flexibility Markets & Services from Distributed Energy Resources," Other publications TiSEM 2edb43b5-bbd6-487d-abdf-7, Tilburg University, School of Economics and Management.
    15. Clastres, Cédric & Percebois, Jacques & Rebenaque, Olivier & Solier, Boris, 2019. "Cross subsidies across electricity network users from renewable self-consumption," Utilities Policy, Elsevier, vol. 59(C), pages 1-1.
    16. Michael G. Pollitt & Lewis Dale, 2018. "Restructuring the Chinese Electricity Supply Sector – How industrial electricity prices are determined in a liberalized power market: lessons from Great Britain," Working Papers EPRG 1839, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    17. Chi Kong Chyong & Michael Pollitt & Reuben Cruise, 2019. "Can wholesale electricity prices support "subsidy-free" generation investment in Europe?," Working Papers EPRG1919, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    18. Bovera, Filippo & Delfanti, Maurizio & Fumagalli, Elena & Lo Schiavo, Luca & Vailati, Riccardo, 2021. "Regulating electricity distribution networks under technological and demand uncertainty," Energy Policy, Elsevier, vol. 149(C).
    19. Yang, Xinhe & Wang, Xiuli & Lu, Zhilin & Liang, Ziyang & Gu, Chenghong & Li, Furong, 2024. "Distribution network tariff design: Facilitate flexible resource under uncertain future energy scenarios," Energy Policy, Elsevier, vol. 188(C).

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    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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