ABSTRACT
Time of Use tariffs consist of participants being subjected to different prices for electricity based on a division of the day into time bands. Instead of a single flat rate for energy use, Time of Use rates are higher when electric demand is higher. An important methodological point to highlight is that in Italy the peak time prices for Time of Use tariffs were mostly adjusted downwards. This is because an additional 6.6 GW of installed capacity entered the market towards the end of 2011 and 12.5 GW by the end of 2012. The role of the Italian energy regulatory agency in setting prices was pivotal also in the first two years of Time of Use practice. Several policy-makers, especially in countries where the implementation of smart metering technologies has reached double-digit penetration, see Time of Use pricing as a viable Demand Side Response option for delivering higher demand flexibility.
