Effects of demand charging and photovoltaics on the grid

Abstract

Due to the integration of renewable energies, the electricity grid is confronted with new peak situations that are caused by the new power plants. Beside these threats new metering technologies combined with information systems enable new pricing options that were not affordable for retail customers before. This paper contributes to the field by combining demand charging incentives with a feed in tariff for photovoltaics. Demand charges are a broadly used pricing concept for large scale and industrial customers but are not used for retail customers yet. In a simulation we first of all show the impact of solar plants on the grid. Secondly, we simulate the shift in electricity demand caused by a demand charge for retail customers. Our simulation shows that the solar panels reduce the purchased quantity of electricity while leaving the maximum peak unchanged. This leads to reduced revenues for grid operators without changing the costs. This negative impact can be improved by the demand charge for retail customers.