EURO 2024 Copenhagen
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1647. Distortions in energy related decision-making at households – An MCP approach incorporating system perspective

Invited abstract in session MD-9: Uncertainties in the Energy Transition, stream Energy Markets.

Monday, 14:30-16:00
Room: 10 (building: 116)

Authors (first author is the speaker)

1. Marco Sebastian Breder
Chair for Management Science and Energy Economics, University of Duisburg-Essen

Abstract

By using a variety of electrical appliances with smart control options, households might play a pivotal role in flexibility provision in the energy market. To exploit the flexibility potential in a most efficient manner from a system perspective, no distortionary impacts should affect operational and investment decisions. To date, most electricity tariffs do not reflect time-dependency in market prices. As a result, households’ investment and operating decisions are based on distorted cost considerations. Scenarios become even more complex when EV owner install a second meter for wallboxes. In this case, two different electricity tariffs may be concluded. We elaborate on the distortionary impacts of tariffs on households‘ investment and operational decisions under the current regulatory framework. Here we focus on investments in PV and battery systems under different tariff designs. Moreover, we exploit the case when a second meter with an additional tariff is in use for EV charging. We formulate the individual optimization problems corresponding to different types of households facing different electricity tariffs. Thereby households are differentiated according to their characteristics, i.e. (potential) Prosumer and EV ownership. A stylized wholesale market will allow to elaborate feedback effects from household decisions. The indvidual problems are combined into an overarching MCP problem.

Keywords

Status: accepted

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