Variabilisation of transmission tariffs

Around 25% of the annual electricity bill of the average household is made up of transmission costs. These costs consist of a fixed sum independent of  actual electricity consumption and consequently provide little incentive for energy efficiency. For grid operators the required capacity (and thus a major fraction of costs) is governed by peak annual demand. If peak demand is reduced a lighter grid can be employed, leading to cost savings. This study examines the effects of introducing variable power transmission tariffs, which would give consumers an incentive to reduce their electricity use and/or shift their consumption to off-peak periods.