Critical peak pricing tariff design for mass consumers in Great Britain

Abstract

“Critical Peak Pricing(CPP)” refers to a method of pricing electricity whereby "Time of Use (TOU)Pricing" is in effect with the exception of certain "peak periods" at which time electric prices may reflect the costs of generating and/or purchasing electricity at the wholesale level[1]. It aims to reduce load during the relatively few, very expensive hours more dynamically. In CPP tariff design, the important elements are the time window over the peak price period and the degree of price differentiations between the peak and off peak times. This paper uses Great Britain market index prices and market index volumes to statistically analyze the price distribution and demand distribution. These analyses will inform the design of appropriate peak pricing window if Great Britain is to move to CPP.