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Economics in action: electricity network tariff innovations

Adrian Kemp describes the impetus for the 2014 changes to the network pricing rules that he helped to develop, and that have been driving pricing reform in recent years. He reflects on how the application of the rules has played out and on the opportunities and challenges for network pricing in the face of the rapid development and uptake of new technologies.

These include the potential for customers to receive substantially lower network prices in return for giving up access to the network for a few hours each year, as well as the scope to reward – or pay – customers for helping to reduce network costs.

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