Multi‐objective low voltage grid tariff setting

Abstract

The design of low voltage grid tariffs can be constrained by several political objectives for the electricity sector, such as energy conservation or an increase of local generation. This leads to trade-offs between these objectives. In this study, a multi-objective model is proposed, to address this task in a European context. The model calculates Pareto-optimal shares of the capacity and energy components for different sets of decision variables. In a case study, the model is implemented for a number of tariff structures such as a flat tariff and a time of use tariff. Results show the trade-off between the objectives. They also show the impact of rising levels of local generation and of a variation in the tariff structure. These case study results outline the importance to formalise high level political objectives and to include them in the tariff design process.