Multistakeholder assessments of the value of distributed photovoltaics for different retail market arrangements

Abstract

The cost fall of solar photovoltaics (PV) in the last decade has driven remarkable deployment of PV worldwide. A proportion of this deployment has occurred within the distribution network, potentially having a significant economic impact on both private industry stakeholders and society as a whole. Hence, the impacts of distributed PV have raised growing concerns on how to maximize PV societal values while managing potential negative impacts on key stakeholders. However, a review, evaluation, and comparison of the societal PV value and the stakeholder private PV values, together with a thorough analysis of their connections and challenges, are still lacking in the literature. In this article, we first propose some clear definitions underpinning the concepts of societal PV value and private PV value, to then review the literature and assess them for different electricity stakeholders and retail market arrangements. From the study of the Australian National Electricity Market, we found significant misalignments and conflicts between societal and private PV values due to a number of market failures, meaning that there are still not appropriate economic incentives for industry stakeholders to maximise the value of PV for society. Moreover, the total value of PV for residential PV customers falls within the possible range of PV values for society, although without the right price signals.