Electricity pricing for customer-utility optimisation of the supply of peaking power

The simultaneous and global optimisation of the customer´s requirements for, and the power utility´s supply of peaking power, remains one of the most challenging tasks of the tariff designer. It not only calls for integrated supply and demand side planning and tariff design, but also consideration of the decision making processes of the customer. The authors explain the benefits of centrally generated and coordinated generation of peaking power, identify the effects and symptoms of an incorrect price of peaking power, and then examine the possible approaches in electricity pricing to achieve optimality in the national supply of peaking power