Impacts of Time-of-Use Rate Changes on the Electricity Bills of Commercial Consumers

TL;DR

This paper examines how changes in time-of-use electricity rates impact commercial consumers' bills, highlighting the importance of distributed energy resources and asset sizing for cost management.

Contribution

It provides an analysis of the effects of rate redesigns on commercial consumers' bills and explores the role of distributed energy resources in mitigating costs.

Findings

Rate changes can increase commercial consumers' bills.

Asset sizing influences cost reduction effectiveness.

Distributed energy resources are vital for cost mitigation.

Abstract

Changes in the profile of prices in wholesale electricity markets prompt utilities to redesign their tariffs and adjust their time-of-use periods to ensure a more adequate cost recovery. However, changing the rate structures could adversely affect commercial consumers by increasing their electricity bills and hindering their ability to reduce costs using techniques like net energy metering. As time-of-use periods are adjusted, consumers will need to rely on the flexibility of distributed energy resources to achieve cost reductions. This paper explores the effect that Pacific Gas and Electric Company's redesigned rates have on the electricity bills of consumers with different demand profiles. Sensitivity analyses are conducted to examine the effect of asset sizing on reducing costs under each tariff.