Incentivizing smart charging: Modeling charging tariffs for electric vehicles in German and French electricity markets

Abstract

Over the past few years, registration figures of plug-in electric vehicles have increased rapidly in industrialized countries. This could cause considerable mid- to long-term effects on electricity markets. To tackle potential challenges specific to electric power systems, we develop a load-shift-incentivizing electricity tariff that is suitable for electric vehicle users and analyze the tariff scheme in three parts. First, acceptance is analyzed based on surveys conducted among fleet managers and electric vehicle users. Corresponding results are used to calibrate the tariff. Secondly, load flexibilities of electric vehicle charging are used in an agent-based electricity market simulation model of the French and German wholesale electricity markets to simulate corresponding market impacts. Thirdly, the charging manager’s (‘aggregator’) business model is analyzed. Our results reveal that the tariff is highly suitable for incentivizing vehicle users to provide load flexibilities, which consequently increase the contribution margins of the charging managers. The main drawback is the potential for ‘avalanche effects’ on wholesale electricity markets increasing charging mangers’ expenditures, especially in France