Implementation of a hybrid grid tariff in Norway: distributional effects, metered consumer response and design trade-offs

The development of distributed energy resources calls for shift in grid tariff design. Most DSOs in Norway implemented a hybrid grid tariff with both a capacity and a time-of-use energy term. In this paper, we have investigated the redistributional effects to determine whether any consumer groups experience disproportionate changes in costs. In addition, metered data was analysed and compared to demand before the introduction of the grid tariff to see if consumers had responded to the grid tariff price signal. Finally, the grid tariff’s trade-offs between different grid tariff design principles were evaluated. We conclude that the grid tariff has resulted in lower costs for low-income consumers, especially those in small apartments, and vice versa for high-income consumers living in large houses with electric vehicles. The capacity intervals do not appear to have triggered any response from consumers. Further developments on the grid tariff can be conducted to improve its cost reflectivity, such as by moving to continuous measured peak demand and dynamic pricing based on real-time grid status, but at the cost of simplicity and predictability, and hence acceptance. Time-of-use energy terms has negative impacts in the long-term due to synchronised demand response resulting in increased peak loads.