Morphological analysis of energy services: Paving the way to quality differentiation in the power sector

Florian Salah, Christoph M. Flath, Alexander Schuller, Christian Will and Christof Weinhardt

Energy Policy, 2017, vol. 106, issue C, 614-624

Abstract: The activation of the still predominantly passive demand side is necessary to further guarantee a stable power system in the short term and ensure capacity adequacy in the long run. A system with a high share of generators with nearly no marginal costs requires new services that facilitate transmitting the right economic signals to the system stakeholders. To this end we refine the notion of energy services and propose a framework to systematically design quality differentiated energy services for consumers. This approach facilitates a value-based economic assessment of energy services that deviates from the marginal-cost-paradigm. We further illustrate pricing options for these new energy service products and outline infrastructural needs and additional use case-specific product properties. Moreover, we discuss how the morphological approach can be formalised using a mathematical programming formulation and introduce a complexity measure that facilitates assessing potential adoption obstacles for end consumers. Additionally, we illustrate the practical applicability of these findings by using a prototypical implementation of a decision support system. To foster differentiated energy services, we recommend a more lenient regulatory regime lowering the barriers for new market entrants.

Keywords: Product differentiation; Energy service; Morphological analysis; Service design; Decision support (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:106:y:2017:i:c:p:614-624

DOI: 10.1016/j.enpol.2017.03.024

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