6. PRIVATE-ECONOMIC ANALYSIS OF DYNAMIC TARIFFS ________ 45
6.2. Process and criterion for the dynamic tariff
6.2.1. Trial designs for the dynamic tariff
The first seven different designs keep X1=0 and X2=2 and play with different combinations of Value1 ( 0 / 100 / 200 / 300 ) and Value2 ( 400 / 500 / 600 / 700 ).
Tariff 0 – 700 / 0-2
If PEL < 0 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 700 DKK/MWh
Tariffs charge 2 times the current tariff, If 0 DKK/MWh < PEL < 700 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Figure 8: Standard dynamic tariff design
Tariff 100 – 600 / 0-2
If PEL < 100 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 600 DKK/MWh
Tariffs charges 2 times the current tariff, If 100 DKK/MWh < PEL < 600 DKK/MWh
Tariffs’ charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 200 - 500 / 0-2
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 2 times the current tariff, If 200 DKK/MWh < PEL < 500 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 300 - 400 / 0-2
If PEL < 300 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 400 DKK/MWh
Tariffs charge 2 times the current tariff, If 300 DKK/MWh < PEL < 400 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 100 - 500 / 0-2
If PEL < 100 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 2 times the current tariff, If 100 DKK/MWh < PEL < 500 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 200 - 600 / 0-2
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 600 DKK/MWh
Tariffs charge 2 times the current tariff, If 200 DKK/MWh < PEL < 600 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 100 - 700 / 0-2
If PEL < 100 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 700 DKK/MWh
Tariffs charge 2 times the current tariff, If 100 DKK/MWh < PEL < 700 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to double charge;
Next Table 5 compares the different outcomes from all seven designs.
TARIFF DESIGN NPV
0 – 700 design, which enables to identify the most beneficial tariffs’ structure for the technologies. All designs provide satisfactory results and do not differ significantly among them. However, the designs with outstanding performance are:
Tariff 200-500 / 0-2 Tariff 200-600 / 0-2 Tariff 300-400 / 0-2
6.2.1.2. X1 and X2 analysis
The following designs are chosen according to Value1 and Value2 fixed from the three last outstanding tariffs (Tariff 200-500 / 0-2, Tariff 200-600 / 0-2 and Tariff 300-400 / 0-2). Then
Table 5: Scenario analysis of Value1 and Value2 outcomes
X1=0 is fixed, since it is wanted to reduce the payment as much as possible. Therefore, the model only plays with different values of X2 ( 1,5 / 2 / 5 / 10 ).
Tariff 200-600 / 0-1,5
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 700 DKK/MWh
Tariffs charge 1,5 times the current tariff, If 200 DKK/MWh < PEL < 600 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 1,5 charge;
Tariff 200-600 / 0-2
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 600 DKK/MWh
Tariffs charge 2 times the current tariff, If 200 DKK/MWh < PEL < 600 DKK/MWh
Tariffs’ charge increases linearly according to the electricity spot price from 0 to double charge.
Tariff 200-600 / 0-5
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 600 DKK/MWh
Tariffs charge 5 times the current tariff, If 200 DKK/MWh < PEL < 600 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 5 charge;
Tariff 200-600 / 0-10
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 600 DKK/MWh
Tariffs charge 10 times the current tariff, If 200 DKK/MWh < PEL < 600 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 10 charge;
Tariff 200-500 / 0-1,5
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 1,5 times the current tariff, If 200 DKK/MWh < PEL < 500 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 1,5 charge;
Tariff 200-500 / 0-2
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 2 times the current tariff, If 200 DKK/MWh < PEL < 500 DKK/MWh
Tariffs’ charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 200-500 / 0-5
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 5 times the current tariff, If 200 DKK/MWh < PEL < 500 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 5 charge;
Tariff 200-500 / 0-10
If PEL < 200 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 500 DKK/MWh
Tariffs charge 2 times the current tariff, If 200 DKK/MWh < PEL < 500 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 10 charge;
Tariff 300-400 / 0-1,5
If PEL < 300 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 400 DKK/MWh
Tariffs charge 1,5 times the current tariff, If 300 DKK/MWh < PEL < 400 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 1,5 charge;
Tariff 300-400 / 0-2
If PEL < 300 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 400 DKK/MWh
Tariffs charge 2 times the current tariff, If 300 DKK/MWh < PEL < 400 DKK/MWh
Tariffs’ charge increases linearly according to the electricity spot price from 0 to double charge;
Tariff 300-400 / 0-5
If PEL < 300 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 400 DKK/MWh
Tariffs charge 5 times the current tariff, If 300 DKK/MWh < PEL < 400 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 5 charge;
Tariff 300-400 / 0-10
If PEL < 300 DKK/MWh
Tariffs charge 0 times the current tariff, If PEL > 400 DKK/MWh
Tariffs charge 10 times the current tariff, If 300 DKK/MWh < PEL < 400 DKK/MWh
Tariffs charge increases linearly according to the electricity spot price from 0 to 10 charge;
Comparative results relied on all 12 designs are presented in Table 6.
TARIFF DESIGN NPV
ELECTRIC
Table 6: Scenario analysis of X2 outcomes
Based on the values in Table 6, the best design for electric boilers is Tariff 200-500 / 0-10 but for heat pumps is Tariff 300-400 / 0-10. The tariff that benefits the most both technologies could be Tariff 200-600 / 0-5.