Aspects of advancement of distribution tariffs for small consumers in Finland

Abstract

This paper discusses the development of distribution tariffs of small consumers in Finland. Changes in the electricity sector have created pressures for the Distribution System Operators (DSO) to develop their pricing practices in order to better reflect their cost structures. In this context, power-based distribution tariffs (PBDT) have been seen as a potential direction for development. This paper analyses the EU and Finnish legal framework for distribution tariffs with an aim to identify potential regulatory barriers and incentives for developing PBDTs in Finland. To support this analysis, the paper also provides results of a survey conducted in Finland in 2016 in the EL-TRAN project, reflecting the will of Finnish consumers to improve their ability to affect the distribution fees. The results indicate that the consumers are interested in having this opportunity.