Tractebel’s Energy Transition and CEEME teams have published a joined article in the University of Cambridge which shows that the creation of an energy community might lead the DSOs to change the grid tariffs so that they still recover their costs. In turn, this change might prompt the creation of new energy communities adapting to the new tariff structure, leading to a snowball effect.
The objective of this paper, entitled “Unintended consequences: the snowball effect of energy communities”, is twofold: first, our experts develop a methodology to model the interactions between energy communities and the DSO. Second, they carry out realistic numerical applications where communities can invest jointly in solar panels and batteries.
Our experts show that the snowball effect often leads to over-investments in photovoltaic by prosumers, which harms the social welfare. They also show that the magnitude of the snowball and its welfare effects will depend on the grid-tariff structure (fixed, capacity-based, volume-based) and they provide some policy recommendations on an optimal tariff structure to reduce the unintended effects of energy communities. Read the full article here.
