
You have already added 0 works in your ORCID record related to the merged Research product.
You have already added 0 works in your ORCID record related to the merged Research product.
<script type="text/javascript">
<!--
document.write('<div id="oa_widget"></div>');
document.write('<script type="text/javascript" src="https://beta.openaire.eu/index.php?option=com_openaire&view=widget&format=raw&projectId=undefined&type=result"></script>');
-->
</script>
Ex-ante dynamic network tariffs for transmission cost recovery

handle: 11565/4070048
This paper proposes a novel tariff scheme and a new optimization framework in order to address the recovery of fixed investment costs in transmission network planning, particularly against rising demand elasticity. At the moment, ex-post network tariffs are utilized in addition to congestion revenues to fully recover network costs, which often leads to over/under fixed cost recovery, thus increasing the investment risk. Furthermore, in the case of agents with elastic market curves, ex-post tariffs can cause several inefficiencies, such as mistrustful bidding to exploit ex-post schemes, imperfect information in applied costs and cleared quantities, and negative surplus for marginal generators and consumers. These problems are exacerbated by the increasing price-elasticity of demand, caused for example by the diffusion of demand response technologies. To address these issues, we design a dynamic ex-ante tariff scheme that explicitly accounts for the effect of tariffs in the longterm network planning problem and in the underlying market clearing process. Using linearization techniques and a novel reformulation of the congestion rent, the long-term network planning problem is reformulated as a single mixed-integer linear problem which returns the combined optimal values of network expansion and associated tariffs, while accounting for price-elastic agents and lumpy investments. The advantages of the proposed approach in terms of cost recovery, market equilibrium and increased social welfare are discussed qualitatively and are validated in numerical case studies.
- Bath Spa University United Kingdom
- Università Luigi Bocconi Italy
- Università Luigi Bocconi Italy
- University of Bath United Kingdom
- University of Bath
/dk/atira/pure/subjectarea/asjc/2200/2215; name=Building and Construction, BILEVEL PROGRAM, FIXED COST RECOVERY, LUMPY INVESTMENT, NETWORK TARIFFS AND CHARGES, TRANSMISSION NETWORK EXPANSION, Systems and Control (eess.SY), Electrical Engineering and Systems Science - Systems and Control, Network tariffs and charges, /dk/atira/pure/subjectarea/asjc/2300/2308; name=Management, Monitoring, Policy and Law, Bilevel program, FOS: Electrical engineering, electronic engineering, information engineering, Fixed cost recovery, Lumpy investment, Transmission network expansion, /dk/atira/pure/subjectarea/asjc/2200/2210; name=Mechanical Engineering, /dk/atira/pure/subjectarea/asjc/2100/2100; name=General Energy
/dk/atira/pure/subjectarea/asjc/2200/2215; name=Building and Construction, BILEVEL PROGRAM, FIXED COST RECOVERY, LUMPY INVESTMENT, NETWORK TARIFFS AND CHARGES, TRANSMISSION NETWORK EXPANSION, Systems and Control (eess.SY), Electrical Engineering and Systems Science - Systems and Control, Network tariffs and charges, /dk/atira/pure/subjectarea/asjc/2300/2308; name=Management, Monitoring, Policy and Law, Bilevel program, FOS: Electrical engineering, electronic engineering, information engineering, Fixed cost recovery, Lumpy investment, Transmission network expansion, /dk/atira/pure/subjectarea/asjc/2200/2210; name=Mechanical Engineering, /dk/atira/pure/subjectarea/asjc/2100/2100; name=General Energy
