RegulationRates with TOU or variable-rate tariffs

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RegulationRates with TOU or variable-rate tariffs

Dear colleagues -

Currently, a broker can offer a tariff with or without RegulationRates. Of course, a RegulationRate has no impact unless the PowerType is an Interruptible or Storage type. Otherwise, the RegulationRate specifies the per-kWh payment for up-regulation and for down-regulation. But since the RR applies to the tariff as a whole, and not to a specific Rate, the fixed payment amounts may or may not be attractive to a customer at any particular time, and the customer's estimate of the value of a RR is quite complex. For example, a customer should probably refuse to provide capacity when the tariff price is higher than the up-regulation price.

This makes me think that a broker might want to somehow coordinate regulation prices with regular consumption/production prices. One way might be to allow RR instances to apply only at specific times, as Rates do now. That might simplify the customer's problem a bit, but I expect the code to make this work would be fairly complex, and it does not solve the problem for variable-rate tariffs. Another approach might be to allow specification of RR prices as ratios; for example, for up-regulation a ratio of 1.2 for up-regulation would specify the payment as 20% higher than the consumption price at the time of the regulation event, while a ratio of 0.8 for down-regulation would specify a cost to the customer for down-regulation as 80% of the normal consumption price. In the RR structure, we could support either scheme, perhaps by adding a "ratio flag" and up-regulation-ratio and down-regulation-ratio values. If the flag defaults to false, then existing code would continue to work. The ratio values would apply only if the flag is set to true.

Does this make sense? Does it give brokers the necessary flexibility to use RegulationRates with TOU or variable-rate tariffs?

Thanks for any suggestions.