Integrating Distributed Energy Resources: Optimal Prosumer Decisions and Impacts of Net Metering Tariffs

Abstract

The rapid growth of the behind-the-meter (BTM) distributed generation has led to initiatives to reform the net energy metering (NEM) policies to address pressing concerns of rising electricity bills, fairness of cost allocation, and the long-term growth of distributed energy resources. This article presents an analytical framework for the optimal prosumer consumption decision using an inclusive NEM X tariff model that covers existing and proposed NEM tariff designs. The structure of the optimal consumption policy lends itself to near closed-form optimal solutions suitable for practical energy management systems that are responsive to stochastic BTM generation and dynamic pricing. The short and long-run performance of NEM and feed-in tariffs (FiT) are considered under a sequential rate-setting decision process. Also presented are numerical results that characterize social welfare distributions, cross-subsidies, and long-run solar adoption performance for selected NEM and FiT policy designs.

20 pages, 11 figures, 6 tables

References in corpus (1)

• On Net Energy Metering X: Optimal Prosumer Decisions, Social Welfare, and Cross-Subsidies

Cited by in corpus (6)

• On Net Energy Metering X: Optimal Prosumer Decisions, Social Welfare, and Cross-Subsidies
• Dynamic Net Metering for Energy Communities
• Operating-Envelopes-Aware Decentralized Welfare Maximization for Energy Communities
• Co-Optimizing Distributed Energy Resources in Linear Complexity under Net Energy Metering
• Achieving Social Optimality for Energy Communities via Dynamic NEM Pricing
• Co-optimizing Behind-The-Meter Resources under Net Metering