In this episode of ERRA’s Energy Regulatory Podcast on Time-of-Use energy prices and network tariffs, host Luca Lo Schiavo, ERRA Regulatory Specialist, talks with Tim Schittekatte, Senior Director at FTI Consulting.
With a focus on practical experiences and lessons for energy regulators, the conversation explores Time-of Use design, including issues related to differences between transmission vs. distribution networks, capacity-based vs. volumetric tariffs, and customer protection.
Key points from the discussion:
- Dynamic prices and local congestion: Low electricity prices can encourage simultaneous EV charging and heat pump use, creating local network peaks.
- Energy prices vs. network tariffs: Energy prices reflect market conditions, while network tariffs should reflect infrastructure costs and constraints.
- Capacity-based network tariffs: Capacity-based (€/kW) tariffs can better reflect network costs than traditional consumption-based (€/kWh) tariffs.
- International regulatory experiences: Italy, Spain and Slovenia offer examples of capacity-based and time-of-use network tariffs.
- Combining dynamic prices and network tariffs: Well-designed tariffs can complement dynamic prices, balancing consumer savings and network efficiency.
- Suppliers and automation: Smart charging and automated consumption management help consumers respond to price signals.
- Regulatory challenges and consumer protection: Regulators must balance cost-reflective tariffs, consumer protection, simplicity and innovation.
Dialogue Partner:
Tim SCHITTEKATTE
Senior Director,
FTI Consulting
