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Steering the adoption of battery storage through electricity tariff design

Journal Contribution - Journal Article

The economic viability of electricity storage using batteries, under different tariff structures and system configurations, is investigated. The economic outcomes of the different combinations of tariff design and system configuration are evaluated. Based on a discussion of the relevant literature, the following tariff designs are used in the study: (i) fixed energy prices, (ii) real-time energy pricing, (iii) fixed rate capacity tariffs, and (iv) capacity dependent capacity tariffs. Next, the different simulated system configurations are outlined: (i) no battery storage, (ii) battery storage only, and (iii) battery storage and decentralized renewable energy production with PV. Our study provides insights for policy makers, showing that capacity block pricing only incentivises storage as part of an (existing) PV installation, while the combination of real time energy pricing and capacity block pricing promotes a wider adoption of battery storage.
Journal: Renewable and sustainable energy reviews
ISSN: 1364-0321
Volume: 98
Pages: 125 - 139
Publication year:2018
BOF-keylabel:yes
CSS-citation score:1
Authors from:Higher Education
Accessibility:Open