Economic Impacts of Power-Based Tariffs on Peer-to-Peer Electricity Exchange in Community Microgrids

Due to the proliferation of renewables-based distributed energy resources, many electricity customers today consume and produce electricity. Since prosumers can benefit from supplying surplus electricity to consumers with electricity deficits, (p2p) peer-to-peer electricity exchange has been proposed for low-voltage (LV) microgrids forming “community microgrids.” The distribution system operator (DSO), who is an important stakeholder in LV networks, has an income that is largely energy dependent. However, energy-based tariffs (EBT) do not reflect the true cost of a DSO's network investment that is highly dependent on the peak power in the network. A power-based distribution tariff (PBT) scheme where customers pay for their peak load (€/kW) instead of consumed energy (€/kWh) has been proposed. In this paper, we evaluate the economic impacts of revising the tariff structure from EBT to PBT on customers participating in p2p community microgrids with photovoltaic (PV) installations. We consider four different Finnish customer types and compare the benefits obtained by 36 customers of each type after their EBT was replaced by PBT. We apply PBT also to the power supplied by prosumers to their peers. Nearly all the customers (expectedly) benefited from electricity exchange especially for the typical PV system size of 5 kWp. When the PV system Sizes were increased, the benefits decreased and became negative at PV system size ≥ 17.5 kWp,. In particular, the savings in EBT and PBT cases were similar-the tariff change from EBT to PBT did not significantly affect the customers' benefits from electricity exchange.