07 de diciembre del 2016 - 08:21

DAREED for Energy Providers

DAREED is a platform that provides diverse functionalities for different users to help them making a better use of energy. Among the others, the platform contains tools to help energy provider companies in the definition of new tariffs with Time-of-Use (ToU) based prices. The new tariffs that the system tries to generate are designed to be profitable for the energy providers and more convenient for the customers, leading overall to an improved energy efficiency in the district.

Our goal in this section is to give an idea of how such tools can be used, and the kind of support they can give. All the tools we will discuss require the user to be registered as an energy provider, which is a simple process done by clicking on the "sign-in" button in the district view.



DAREED tools for defining "tailored" tariffs

The first tool that we consider helps an energy provider in the definition of custom (or "tailored") tariffs for specific energy consumers. The DAREED Market Place (accessible via the corresponding icon in the app panel) is a good place to look for suitable customers, which of course must have a large enough consumption to be worth a personalized energy contract. The Market Place can be used to look for requests, advertise the opportunity to have a custom tariff, and (once a suitable customer has been found) to exchange via messages the information that is needed for the definition of the new tariff.

The task of defining a new tailored tariff can be simplified by using the tool called "Suggest Prices for Buildings", which can be accessed from the app panel. In the tool terminology, a new case study is called a "scenario" and therefore making a new scenario is the first step in the process. From the "new scenario" form, a user can specify a name for the case study, the preferred measurement units for energy and costs, and (most importantly) a price band scheme. This tool is in fact limited to tariffs based on Time-of-Use prices, which can specify different prices for different "price bands" in a week. The price bands are usually subject to national regulations, and the DAREED platform supports a sample of the existing ones in Italy, England and Spain (more schemes will be added in the future).



The next step is configuring the new scenario that has been built: this can be a tricky process, because defining a new tariff is a complex operation that should take into account a number of factors, such as the energy consumption of the user, the tariff that the user is currently employing, and the cost for providing energy in the different price bands. Most of this information can be obtained by discussing with the potential customer via the Market Place tool.

An unusual and innovative feature of this tool in the DAREED platform is the ability to take into account (up to a certain degree) the user behavior in the definition of a new tariff. In particular, the tool characterizes the user behavior in terms of:

  • Flexibility, i.e. user ability to shift the consumption to take advantage of price difference among in different hours of a day;
  • Conservation, which is meant as a measure of how much the user is prone to sacrifice/add activities (e.g. using a clothes dryer) to reduce/increase the total energy consumption;
  • Risk aversion, which represents the minimum amount of savings that should be achieved to consider a tariff switch;
  • Perception accuracy, which is a measure of how good a user is in estimating energy consumption in real time.

Discussing with the customer on the Market Place can be an effective way to understand how all these "behavioural parameters" should be tuned. If there is no better estimate available, one can always resort to the default values given by the DAREED tool, which are based on the scientific literature on the field.


Once the scenario has been fully configured, one can obtain a suggestion for the new tariff by clicking the "solve" button. After some time (usually a few seconds) the tool will provide a first possible solution that will be tentatively improved until 1) the user stops the process manually, or 2) once a time limit has been reached, or 3) until no further improvement is possible. The user can then inspect the solution, which contains recommendations about the prices for the new tariff, an indication of whether the tariff is attractive enough for the customer, and an estimate of how users' energy demand is likely to shift due to the new prices. An effective tariff will get a new customer to the energy provider and a better deal to the energy consumer, resulting in a win-win situation.



Once the user is satisfied with the new tariff, the offer can be communicated to the potential customer again via the Market Place.

DAREED tools for defining "tailored" tariffs

A second tool that targets energy providers is designed to support the assessment of new potential markets and the definition of new tariffs for large classes of small energy consumers. In particular, the tool can be used to investigate whether a certain district provides a good market for a certain type of tariff, and to define a new tariff that is especially designed to beat the competition on that district.

The tool is very similar to the one we have just described, but operates at a full district scale: it can be accessed from the app panel by clicking on the icon called "Suggest Prices for Districts".



Once again, the first step of the process is defining a new scenario. However, in this second tool the system allows the user to select a target district (from those monitored via the DAREED platform) and automatically import consumption data. The scenario will contain an energy consumer (or "customer class" in the tool terminology) for each type of consumption that is considered by the DAREED platform. If the energy provider is not interested in some of those classes, they can be removed from the scenario by just clicking a button. Since defining a new tariff is a complex task that can be computationally expensive, it is usually a good idea to focus the scenario on just a handful of energy consumers.

Each of the "customer classes" in the scenario will be described as in the previous case, i.e. via the corresponding energy consumption in each price band, the currently used tariff, and the behavioral parameters. The main difference is that a "customer class" refers to a large group of small, similar, energy consumer rather than to a single, large energy consumer. The most important side effect is that the new tariff that the DAREED tool will recommend may end up being appealing for just a part of one of these customer classes.

Besides the customer data, a scenario definition will contain information about the cost for providing energy in each price band, and about one or more existing tariffs offered by competitors that the energy provider wishes to beat.



Other than that, the tool works in the same way: once the scenario is configured the energy provider can click the "solve" button and obtain price suggestions for a new tariff. The solution can then be inspected to access the recommended prices, estimates about the fraction of customers in each class that are likely to switch to the new tariff, the subsequent shift in the energy demand, the expected profits, etc. By looking at the fraction of switches and the expected profit, the energy provider can assess how appealing the district is from an economic point of view. The suggested prices can then form the basis for an actual tariff to be proposed to the district users.


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