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The Changing Decision Patterns of the Consumer in a Decentralized Smart Grid


Abstract and Figures

The well-regulated Swiss electricity market is subject to far-reaching transitions towards an intelligent network. These include a shift of responsibility, as the consumer comes to play an active role in electricity management. While previous re-search suggests that the consumer acts according to rational choice or non-cooperative game theory, this is not a sufficient justification for consumer decision-making in a socio-techno-logical environment. To this end, this empirical research elabo-rates on the decision-making patterns supported by the techno-logical change. The findings suggest that to a certain extent, diffusion of decentralized generation and storage create new responsibilities for a micro trader apart from consumption. Central for trading is the “security of supply” value and any perceived gains and losses in the value outcome entails switching between risk-averse and risk-seeking behavior.
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The Changing Decision Patterns of the Consumer in a
Decentralized Smart Grid
Mario Gstrein, Stephanie Teufel
{mario.gstrein, stephanie.teufel}
iimt, University of Fribourg, Switzerland
AbstractThe well-regulated Swiss electricity market is subject
to far-reaching transitions towards an intelligent network. These
include a shift of responsibility, as the consumer comes to play
an active role in electricity management. While previous re-
search suggests that the consumer acts according to rational
choice or non-cooperative game theory, this is not a sufficient
justification for consumer decision-making in a socio-techno-
logical environment. To this end, this empirical research elabo-
rates on the decision-making patterns supported by the techno-
logical change. The findings suggest that to a certain extent,
diffusion of decentralized generation and storage create new
responsibilities for a micro trader apart from consumption.
Central for trading is the security of supply” value and any
perceived gains and losses in the value outcome entails switching
between risk-averse and risk-seeking behavior.
Index Termssmart grid management, economic behavior,
decision making pattern.
Currently, the Swiss electricity market is host to a violent
debate regarding the topics of energy efficiency, electricity
supply, sustainability, and optimization of electricity utiliza-
tion. The trigger for deliberations consist of new guiding prin-
ciples (exit of nuclear power, influx of renewable sources),
design criteria (request of an intelligent network) or other
requirements (increase in consumption through demographic
changes, electrification) [1, 2]. To meet the requirements, the
sector is undergoing a transformation, the outcome of which is
not yet known. Standards are missing and multiple new play-
ers are emerging the field [3]. Furthermore, the transformation
path inherits a great deal of uncertainty and ambiguity, which
leads to different directions and clashing opinions [4]. Scenar-
ios are useful to reduce the uncontrolled speculations and to
support the collaboration of actors, but smart grids scenarios
exhibit more decentralized architecture and the integration of
manifold small units where the end-consumer (later called the
consumer) actively influences the overall electricity manage-
ment [5, 6]. Currently, the electricity producer and distributors
(later called suppliers) enter the discussion with their “tradi-
tional” perspective and mind-set of consumers as passive
receivers as an inconvenient factor for electricity management.
Suppliers argue the overwhelming management efforts of such
units are difficult and can cause a loss of stability. Additional-
ly, extra communication infrastructure to control the grid is
expensive. Further arguments are the leverage reduction and
the profit loss through lower quantity sales. So, suppliers are
not necessarily interested in advanced consumer influences
within the supply chain as it disrupts their current business
models. However, the continuous growth of decentralized
generation and storage units provides additional opportunities
to optimize the distribution of electricity, and suppliers are
accustomed to the idea of the electricity grid decentralizing
towards individual or micro grids [7].
Some demand side management models (DSM) focus on
managing consumer loads, e.g., control of consumer devices
[8], where other models are advanced and profoundly inte-
grate the consumer [9, 10]. These models still impose the
subordinated consumer role and assume a rational human that
avoids risky options, prefer selfishness and react primarily to
monetary incentives. Studies have shown that humans behave
inconsequentially and adapt their choices violating the ration-
ality axiom [11]. To generate improved simulation models,
consumers need to be defined with other assumptions as well
as need to handle adaption of choices to determine the load
but also the price of electricity [12]. A challenge is the defini-
tion of consumer decision patterns which means dealing with
a large number of independent users with various behaviors
[13]. Therefore, this paper aims to utilize the prospect theory
[11] to determine an underlying consumer decision pattern
within a socio-technological smart grid. This paper also con-
siders the effects of consumers becoming a non-business-
driven trader and evaluates the gains and losses in the prospec-
tive value, specifically the security of supply.
Traditional DSM concepts are similar to well-known con-
sumer integration paradigms to reduce costs, e.g., arranging
furniture or customizing cars. Single steps, mostly at the end
or beginning of a value chain, are made the consumer’s re-
sponsibility. Though the control is still on the supplier’s side,
a smart grid goes beyond and extends the idea of a prod-user
[14]. Within a smart grid, the consumer abruptly influences
the consumption behavior, contributes to the production and
supports the stability of the grid. Electricity management hap-
pens in the masses rather than at a few isolated points [15].
Consequently, the management becomes a dispute between
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
supplier, government and consumer. However, the consumer
role experiences a major shift and still the attitudes of which
consumers enter the market are not well defined.
A. The Fourfold Pattern
The gambling metaphor following conclusions based on
elementary axioms of rationality is a popular example of deci-
sion-making; a preference for one choice outweighs the other
to maximize the benefits and minimize the costs [11]. In re-
cent years, intelligent rational decision-makers give rise to
doubts as people adapt their risk choices, which violate the
rational choice axiom [11]. People act risk-averse in some
instances and risk-seeking in others. The shortcoming leads to
the development of more sophisticated models where deci-
sion-making is applied in the matrix of the prospect changes
and probability of occurrence (Fig. 1) [11].
Figure 1. Fourfold pattern (adapted [11])
To explain the change of choice, an understanding of the
values of gains and losses is necessary [11]. According to
[11], the prospect value (also called utility) of gains and losses
are in a relation of 1:2 and hence the expected responses for
gains are weaker than for losses. Thus, people normally exhib-
it loss aversion and defend their status quo. Secondly, the
evaluation of positive or negative alterations requires a refer-
ence point distinguishing between the same utility.
On the other axis, the probability of occurrence can be
separated in possibility and certainty effects. Normally, a 5%
change of probability to win a gamble would be expected
equally regardless of whether the probability increases from
0% to 5% or from 95% to 100%, but, as shown by [11], the
decision weights are disproportional to the probability of
change and hence do not depend solely on quantitative proba-
bilities [11].The prospect of unlikely outcomes influences
someone to weight higher the change as it exists in reality.
This possibility effect explains lotteries where people pay
higher prices for a small chance to win a large prize. Another
example is paying insurance for rare events such as fire to
cover losses. On the other hand, the certainty effect causes
lower decision weights as the probability justifies. This is
attributed to the fact that people are risk-averse in the prospect
of a certain gain (Bernoulli’s expected utility) and accept less
risk to avoid disappointment. By contrast, in certain loss situa-
tions (deciding between bad options) a risk-seeking behavior
occurs in a bid to avoid losses. The negative prospect of a sure
loss is less desirable than the gamble. Overall, the diminishing
sensitivity under high probability promotes risk aversion for
gains and risk-seeking for losses. However, low probability
outweighs the sensitivity and produces the pattern of risk-
seeking for gains and risk aversion for losses (Fig. 1).
B. The Socio-Technological Environment
The described decision pattern of a simple gamble exam-
ple allows for understanding individual behavior, but for a
more elaborate discussion it is necessary to transfer these
patterns into a socio-technological system like the Swiss elec-
trical grid. The electrical grid consists of agents (e.g., suppli-
ers, distributors or consumers), the grid network (e.g., plants,
wires, transformers) and ruling (e.g., policy, mindsets, behav-
ior) which are in dynamic mutual interactions (Fig. 2) [4].
Agents adapt dynamically to the new context through a con-
tinuous process of combining rules to seek benefits [16]. In
certain situations, they act more selfishly than in others. At a
given time point a consumer follows a set of successful rules
that provide strategic scope. The different strategic patterns
allow for moving through the rugged landscape [17].
Figure 2. Three interrelated analytic dimensions (adapted [4])
There are different regimes involved that are distinguished
by social groups and related rules [4]. For example, traditional
suppliers with their artefacts (e.g., plants) operate according to
certain policies and mind-sets in a technological regime (cov-
ering demand in real-time). The transition to a smart grid
entails the entrance of new technology and agents (ICT sector)
changing existing rules and enforcing the development of new
artefacts and standards. Technological innovation not only
creates new artefacts causing alteration of the own regime but
also induces reactions in other regimes [4]. For example, the
availability of cheaper and more efficient solar panels supports
the decentralization of production [18] and permits to establish
a consumer regime in the electricity industry following their
own mind-set, beliefs and values. A consumer regime is
bounded by regulative rules (e.g., laws, sanctions) defining the
scope of decision options for individuals. For example, the
context for decentralization is supported through policy initia-
tives by regulating the barriers [1921]. Furthermore, up to the
present defined normative rules specify that the expected
consumer’s role and actions would be seen as demand for
electricity while the supplier’s role and actions are to make
profit. Nevertheless, both parties require stability of the net-
work, and in a realistic scenario, neither party can conform to
these simple rules one hundred percent effectively nor can
parties be viewed in isolation. There is a definitive link
through supply and demand that postulates the need to culti-
vate a symbiotic relationship. In the future, the consumer will
produce and store electricity spanning both roles (producer
and consumer) and provide a closer link among actors in their
dedicated role. For example, the adoption of decentralized
storage to balance surpluses is an act of the consumer giving
up his own benefit for the grid. This is not limitless and an
expected equilibrium is reached at 38% [10].
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
How this symbiotic relation is defined depends strongly on
the evolved social norms in a smart grid. Social norms will
influence the decision processes of individuals and organiza-
tions. Therefore, the key question is how do we as a society
define the social norms for the electricity in the smart grid, in
the context of the following question. Is it a fundamental right
or can it be treated as a traded market good? The act of con-
formity to norms is to match attitudes, beliefs, and behaviors
to superior norms and thinking [22]. Social response to con-
formity is a continuum from assimilation (conversion) to ne-
glecting of norms (anti-conformity) [23] and depends strongly
on available technology which allows reaching a certain de-
gree of self-sustainability. Besides that the size of majority
following specific norms influence private values [23], and is
distinctive for regional specified norms rather national-wide
ones. Which impact these factors have is object for further
research, but the individuality provides groups of conformists
and anti-conformists.
A. The Consumer’s Gains and Losses of Value
Recent smart grid discussions promote money as the pri-
mary value for consumer decisions. The prospect of cheaper
electricity and the saving potential of consumption dominate
the debates. For an explanation of consumer motivations,
these points are arbitrary due to the bounded rationality of
consumers to compare prices and since the saving potential
only affects the energy price, which is one-third of the elec-
tricity bill [20]. Moreover, the feed-in compensation is a driver
for diffusion of production, but in the long term, the subven-
tion is insufficient because the consumer regards electricity
management a as non-core functionality. Thus, money is more
the result of actions rather than the driver, and the quality of
the smart grid is a cultural and ethical rather economic and
technical question [24].
The purpose of a smart grid is the optimization of electrici-
ty, and each player would have to behave according the rules
of the game [4] as a derivation jeopardizes the stability and
performance. The rules derive from the pursued targets of a
consumer and each decision is made to support the goal. So, it
becomes an intrinsic motivation. Within a smart grid five
targets exist [25]: economic performance, technical perfor-
mance, environmental friendliness, safety and product quality.
Generally, all targets should be achieved, but, agents are more
focused on some targets than others. Additionally, some tar-
gets are contradistinctive, e.g., environmental friendliness and
technical performance. For the consumer, product quality is
important; in particular, the security of supply and each gain
or loss is evaluated against it. Other targets (e.g., environmen-
tal friendliness) might also be important, especially in the
Swiss electricity market, which is characterized by stable
networks, environmental stewardship, high economic stand-
ards, trust in supplier and deep poverty rate; however, the
security of electricity originates from the basic instinct of
supplying a need [26]. Furthermore, several scenarios claim a
higher demand and reliance on electricity due to geographical,
electrification and lifestyle trends [27,28]. A shortage of elec-
tricity and the subsequent consequences in the areas of indus-
trial production, hospital, or public transport would lead to
undesirable benefit loss. For a common private user, there
might not be life-threatening reasons; rather, it likely depends
on an egocentric, comfortable attitude, e.g., the luxury of
devices being available twenty-four hours a day.
B. The Consumer Regime in a Smart Grid System
The consumer regime displays different mind-sets, beliefs,
and values and competes in the market following other param-
eters than suppliers do. Decentralized production and storage
allow for the manipulation of electricity accessibility (Fig. 3)
and support a certain degree of self-sustainability.
The decentralized electricity production offers a direct and
close source with tremendous implications for the demand,
and it directly influences the security of supply. Associated
risk averseness and risk-seeking are linked to performance of
production and the inherent limitations
. Production and usage
distance is tighter, and the advantage is the increasing auton-
omy of supply and prevention of interferences. The extension
of capacity, either through installing new elements or in-
creased efficiency, is regarded as a gain in the security of
supply. To determine the capacity, not only is the performance
of PV critical, but also the natural load diversity of renewa-
bles, especially in adversity periods like winter. Additionally,
inherent system limitations like sun irradiation and available
surface restrict the capacity [2, 29]. Limitations or other dis-
turbances (e.g., maintenance) foster the losses of value. Addi-
tionally, the probability between certainty and possibility
changes during the day as well as during the season due to
mentioned performance and limitation settings. Thus, it is still
necessary to interact with the grid to ensure security. Eventu-
ally, the decision pattern is strongly coupled with the charac-
teristic production curve of PV where risk averse behavior is
observed when there are surpluses and risk-seeking behavior
is observed when there are shortages of electricity.
Figure 3. Schemata of decentralized production and storage.
The idea of storage is to transfer current electrical capacity
through time for future use. The storage symbolizes for the
consumer the scarification of demand in favor of postponing
the benefit of electricity; similarly to saving money in a bank-
ing account. A decoupling of simultaneous production and
consumption occurs. Saving electricity can be achieved by
consumption reduction or by producing a surplus. The poten-
tial for additional available electricity is higher in the produc-
tion expansion than in the decrease of electricity demand. By
absorbing the surplus, storage size strongly correlates with the
For further discussion, we only consider a photovoltaic (PV) solution as a
potential application to install in small locations. Therefore, we assume that
the production follows the characteristic bell curve shape. The potential for
integrated PV production in Swiss buildings is estimated to be 18.410
terawatt hour per year which would cover 34.6% of the total Swiss consump-
tion [18].
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
maximum capacity of distributed generation. Any increase in
production leads to an extension of space as long as empty
storage space does not grow proportionally. In the end, an
equilibrium state is reached and any short-term alteration will
be avoided. Thus, the risk-averse or risk-seeking behavior
primarily depends on the factors of storage size and the proba-
bility of filling it.
Considering the both factors in interplay, the consumer
acts risk-aversely at high production rates when maintaining
security and options of wasting electricity or feeding it in to
the grid are unfavorable. In other words, selling electricity at
low prices during overproduction period is less beneficial as
saving it for future references. The certainty to bet on sure
thing of electricity availability outweighs the monetary reve-
nues. Any fear of loss during that time caused by unlikely
events as malfunctions may be assuaged either through back-
up solutions or by covering financial damages. Contrarily,
risk-seeking behavior is dominant mostly at low production
and low storage capacity this implies low electricity availa-
bility. The consumer is willing to gamble for security due to a
high probability of a shortage leading to immense losses.
Avoiding sure losses the consumer investigates in different
price options. On a lower probability the market offers prom-
ising greater prospects to increase security prevail.
Risk behavior differs with the new functionality of short-
term buffer memory. The concept is to reserve a certain de-
centralized storage space exclusively to fill and empty it. For
distributors, the extra space provides possibilities to stabilize a
network’s fluctuations, whereas for producers, it is an addi-
tional possibility to transfer cheap produced electricity into
expensive periods. Several studies prove the applicability and
the potential uses, e.g., hybrid cars [30], electrical batteries
[31]. The buffer is a reduction of security from the individual
viewpoint and the object is to keep the space at a minimum.
Conversely, the short-term buffer is primarily grid-oriented
and is subject to social norms that do not consider individual-
ism. Community-related issues are treated with priority. Con-
sidering the equilibrium state and that storage cannot extend
limitlessly in the short term, the grid shows risk-seeking be-
havior at prosperity times; e.g., gambling for space is pre-
ferred as wasting cheap electricity is a loss in the future securi-
ty. Conversely, the grid behaves risk-aversely in low produc-
tion periods and neglects unnecessary supply to sustain securi-
ty for potentially graver incidents, e.g., shutdowns. How far
the consumer incorporates these considerations into decision-
making is subject to further research, but there is a conflict
between autonomy of consumer and grid requirements. In the
end, the consumer becomes a non-profit micro trader extend-
ing responsibilities. The industry thus must consider consum-
ers decision patterns in new pricing strategies.
C. Pricing Strategies Under Decision Patterns
Current pricing debates proclaim that “time of use”, “de-
mand bidding” or “auction-based” are adequate techniques for
smart grids [13]. Traditionally, these are based on economic
mechanisms where the price originates from production costs
or trading. So far only suppliers are involved in the price find-
ing process [20], but the consumer’s possibilities of produc-
tion and storage allow participating in this process.
The day-time demand of electricity is high at lunchtime
and lower at nighttime (Fig. 4). At prosperity phases, the de-
centralized production adds to the overall electricity volume
and replaces supplier units. Additional generated electricity
and decentralized storage bolsters security, and risk aversion is
dominant as the stored electricity is a guarantee for adversity
times. Temporarily the demand increases and causes no extra
marginal costs due to different consumer investment approach.
The consumer neglects invested costs and associated return of
investment as self-sustainability is egoistic motivated. A “no
cost” mentality takes root. Thus, already installed infrastruc-
ture is regarded as paid off and decentralized, produced elec-
tricity illustrates a zero price being favorable versus paying the
real production price.
Figure 4. Decoupling of demand and production
The changing situation creates a new competition para-
digm. First, suppliers compete on price and capture benefits
through strong divergent marginal production costs [2]. Any
response from suppliers to cover the request by activating
expensive dispatchable units must be compensated by in-
creased prices. This is unacceptable for the consumer except
if the occupancy rate of the storage is insufficient. The fear of
losses increases the acceptance of paying prices to guarantee
security, for example an insurance service to avoid electricity
shortage. Those value added services provide a new revenue
stream for suppliers and become stronger and diversified in
the future. Eventually, preferred sources for storage are either
self-produced surplus or very cheap electricity and the con-
sumer is only willing to pay higher external prices due to fear
of large losses in the prospect of a failure.
The extraction of cheap electricity from the storage occurs
during the offline period of decentralized renewables; hence
storage temporarily becomes a “production” unit. Storage
extends low electricity prices horizontally through time and
prolongs the period into high price segments. At the adversity
phase, paying higher premiums with a full storage is not op-
tional. This situation occurs when the storage bridges the
renewable offline period when production starts again. Con-
versely, partial coverage and the prospect of losses in security
support risk-seeking leading to a gamble between options.
During offline phases, the consumer accepts the market price
or value added services that guarantee security. Those services
are offered on a higher premium which attracts other suppliers
causing a different competition field. Meanwhile, insufficient
services or a boost of market prices creates a stimulus to invest
in more decentralized units [32] and augments the production-
storage capacity. This can lead to consumers investing in more
storage as the decentralized generation performs solely to
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
absorb cheap external production. A counter effect on storage
capacity is the short-term buffer memory. Any agreement to
allocate size for the system purposes expects a reimbursement
at least high as the transportation fee.
Eventually, the electricity market will undergo a transfor-
mation similar to the telecommunication sector where the
basic element (calls) was not profitable and services like data
exchange became lucrative. Therefore, the pricing strategy
depends strongly on the success of service definitions and the
understanding of consumer’s requirements for supporting risk-
averse and risk-seeking behavior.
Decentralized units represent many challenges for electric-
ity suppliers. A major challenge is the adoption of novel per-
spectives, skills and capabilities in response to the changing
consumer role. The consumer acts like a micro trader and
evaluates gains and losses of value outcome. The value is
strongly related to security of supply and hence in certain
situations the consumer shows risk averseness and can shift to
risk-seeking behavior in another moment. By understanding
the mechanism of decision-making and a consumer-centric
focus, suppliers have the ability to create new tariff structures
and value added services, e.g., carefree packages. Such ser-
vices offer the opportunity to replace the financial losses, as
quantity will be decoupled from profit. Another opportunity
for business is the integration of numerous small units, and
companies can distinguish themselves by the quality of effi-
cient electricity distribution with the grid. Additionally, the
management of cooperation among consumers in micro grids,
providing the infrastructure for generation and exchange of
electricity among the members [9, 33, 34] is another area
where opportunities exist.
This article demonstrates that the decision-making patterns
of consumers depend on probability and the perceived gains or
losses of the outcome. The outcome is contingent on the most
important consumer value, security of supply, rather than on
economic factors. In conclusion, the consumer behaves in a
risk-averse manner in times of electricity prosperity and in a
risk-seeking manner in times of electricity scarcity. Such be-
havior is strongly influenced by the technological diffusion of
generation and storage. This article provides a first step to
understand consumer decision-making and is a direction to
improve smart grid simulation models. However, future re-
search is still necessary to inquire a more detailed approach.
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EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
EEM14 - 11th International Conference "European Energy Market", 28-30 May, 2014, Kraków, Poland
... This demands an integrative mindset combining different aspects to form a consistent structure. For example, the described technological functionality of storage depends on the willingness to share, which can be understood as risk-averse or risk-seeking behavior of individuals [59] . This means that any sharing with other cells is time-dependent and likely to occur if the current storage level is sufficiently high to exchange electricity. ...
... This means that any sharing with other cells is time-dependent and likely to occur if the current storage level is sufficiently high to exchange electricity. In other words, prosumers do not jeopardize a shortage of electricity supply in the near future [59] . Eventually, such considerations allow for verification of such measures as the threshold of cell numbers. ...
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The traditionally centralized approach of electricity networks is progressively undergoing a shift towards a decentralized, distributed structure. The local and crowd-based principle is transforming the existing supply chain and related activities into a value network (VN). Previous researches on crowd value network concepts focus on the activities of infrastructure and load management and neglect activities that generate collaboration. Collaboration with and within crowds particularly demands a different mindset and management of sharing values, information, benefit, and risks. Furthermore, these concepts must integrate technical, processual, and social aspects. Thus, this article proposes a holistic framework of electricity VN management for crowd energy. It redefines VN activities for infrastructure and load management while appendingVN activities for social electricity handling. Additionally, the framework illustrates the interactions among these three elements and concludes with an adaption cycle for the crowd value network.
... Keputusan pembelian merupakan hasil dari pilihan dari beberapa pilihan yang ada, hal ini dilakukan harus sesuai dengan harapan konsumen dalam mengambil keputusan (Rahman & Wahab, 2004). Menurut (Gstrein & Teufel, 2014), pola pengambilan keputusan konsumen tergantung pada pola probabilitas dan keuntungan atau kerugian dari hasil yang dirasakan. Langkah-langkah dalam proses pemilihan keputusan dimulai dengan kebutuhan akan sesuatu, motif. ...
The condition of Islamic banking in Bali is very contradictory, seen from the Muslim population of 12.08 percent, but the number of Islamic bank customers is only 3 percent, it is interesting to explore the decision-making factors to become a customer of Islamic banks. This study aims to explain knowledge, interest, awareness, in constructing decisions. The population of this research is the customers of Bank Syariah Indonesia Kuta Bali Branch totaling 4,123 customers. The sample used is 112 respondents, respondents are customers of Bank Syariah Indonesia Kuta Bali Branch. This research was analyzed using SEM-PLS analysis technique. The results showed that knowledge did not have a positive and significant effect on interest, knowledge had a positive and significant effect on awareness, interest had a positive and significant effect on decisions, awareness had a positive and significant effect on decisions, had no significant effect on decisions, interest was proven to mediate the effect on decisions. decisions, awareness proved to be a partial mediator on the effect of knowledge on decisions. The theoretical implications of this research contribute to developing theoretical concepts related to factors of knowledge, interest, awareness in shaping decisions to become customers of Islamic banks. The practical implications provide insight to Islamic bank management that high knowledge in the community cannot make decisions, but with the role of interest and awareness as a mediator, knowledge can influence decisions.
... The degree of self-sufficiency for a given period depends on current electricity generation and consumption. Individual self-sufficiency can be increased by storing electricity in surplus periods and using it in periods when production cannot cover consumption (Gstrein & Teufel, 2014). Therefore, whether an iGSL cell operates independently from a grid depends on its infrastructure, usage and application of it. ...
Conference Paper
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The traditionally centralized and vertical structure of electricity networks is changing to be more decentralized. By integrating bottom-up energy provision, the industry is undergoing drastic structural changes. Bottom-to-bottom electricity provision solutions via prosumer communities, such as Crowd Energy, will change the grid in a sustainable way and reinforce the paradigm shift affecting the electricity sector. The integration of energy-prosumer communities on a low voltage distribution level affects not only the structure of electricity supply in a grid but also its underlying framework. Current energy behavior research mostly focuses on understanding household energy consumption behavior in a traditional structure and is unable to express prosumer behavior in a decentralized and horizontal structure. For the first time, this paper proposes a broader view of energy prosumer behavior in a prosumer-shaped electricity network. A prosumer behavior framework will highlight the changing and merging roles from a consumer to a prosumer and changing responsibilities in a decentralized and horizontal electricity market. It argues for broader behavioral research, both for network stability reasons and to consider its application for societal, political and economic perspectives on decentralized electricity networks.
... The switching roles of 'prosumers-as-consumers' and 'prosumers-as-producers' as well as the from the switching role resulting 'prosumption-dependent'-provision paradigm have been presented in a former article [23] . Prosumers and their ability to be (partially) self-sufficient due to their intelligent Generation-Storage--Load (iGSL) structure will play an important role in many different ways in the energy network and system [23,23,[32][33][34] . The system will increasingly be shaped by new accountabilities and responsibilities of prosumers for network stability, reliability and security issues through their distributed generation and especially through embedded distributed generation. ...
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The decentralization of the energy sector's infrastructure is commonly understood as an important step towards an efficient and sustainable energy system. However, technical measures only have a limited impact on the systems goals. The decentralization of decision-making, the empowerment of households and the occurrence of prosumer communities require more human-centric approaches to meet future challenges; the application of the subsidiarity principle and decentralization seems inevitable but also unclear in its implementation in an energy system, the cooperation behavior of community members gains in importance and the design of prosumer communities must overcome economic problems. This article emphasizes the human-centered challenges which go along with prosumer communities. We apply economic principles to reveal major problems which go with the shifts in energy-related decision-making towards prosumers and integrate behavioral science for prosumer community design. We highlight the importance of energy as an interpersonal construct; a view on energy which will gain in importance within a prosumer communities shaped network.
... Traditional utility companies get active competition from other companies, for example from those with their core competence in the fields of information technology or telecommunications. But they also have to deal with their previous customers, who change their role from energy consumers to energy prosumers, thus representing the paradigm shift from a "to-you" to a "withyou" world (for the definition of prosumer, see [3], [5], and [7]; for the paradigm shift see for example [6]). Energy prosumers generate, store and consume energy (electricity) by themselves, and they can trade energy surpluses. ...
Conference Paper
The smart future is characterized by sensors and information and communications technology. Technology convergence is facilitating new and innovative energy concepts such as Crowd Energy and other smart environment concepts. But as technology converges and processes, things, people, and businesses become more interconnected, awareness of cyber risks and thus information security culture is becoming progressively more significant. This was shown in a Swiss case study about cyber risks. Awareness and culture are key issues which, from a human-centric perspective, take behaviors, attitudes, and the underlying system of norms and values into account. This paper discusses security issues in a Crowd Energy environment and introduces Crowd Energy information security guidelines (CEIS guidelines) based on OECD standards. Finally, an initial implementation concept is provided.
... Prosumers are seen to represent the main source of resistance. At the same time the predictability and manageability of their behavior are crucial for smooth integration of renewables, SGTs, and the crowd energy [20] . Thus, the EU has to put more attention to socio-psychological aspect of the integration of innovative technologies in an energy sector. ...
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The implementation of higher shares of renewables in a global energy mix has to be accompanied by simultaneous deployment of enabling smart grid technologies (SGTs). This combination will inevitably lead to a revolutionary change in a conventional energy system, particularly, the shifting role of consumers to prosumers. But resistance may arise from such a dramatic shift, since it is associated with high uncertainty in conjunction with increasing responsibilities of all stakeholders, the urgent need of effective control, and the development of a process. To ensure the positive influence, coherent actions of all players, and appropriate treatment of the spots of resistance, the analysis of the interplay between key stakeholders has been done. The paper introduces the framework for stakeholders' analysis, applies it on the European Union (EU) example, and provides recommendations to reduce the resistance of SGTs deployment.
... In this context, smart grid management, economic behavior and decision-making patterns of the crowd stakeholders are investigated (Gstrein and Teufel 2014). The move towards value networks and the development of a crowd energy management framework are observed (Gstrein and Teufel 2015). ...
Conference Paper
Sensor networks and information and communication technology play an important role in everyday life. Our world is currently in the process of evolving from a digital realm into a smart world. Technology is a driver for smart living in such a smart world. However, since smart living is intended to benefit the population by increasing quality of life and making the economy sustainable, the issue must be discussed from more than a merely technological perspective. An approach that integrates economic and social science considerations is necessary. Such an approach is employed in this paper’s objective to identify sectors where innovations are possible and needed in terms of future smart living. This is followed by a derivation of high-priority research areas for future inquests into this emergent topic.
... Different research projects on the issues identified in this conceptual position paper have already been placed [42], [43] . ...
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After the Fukushima disaster, European politicians began to reassess the energy strategy for their countries. The focus is now on renewable energy sources and as a result on decentralization. The decentralized generation, storage, and of course the consumption of energy is the central point. Now with the new developments under the roof of energy turnaround the way back from the centralized architecture of our energy system to a more decentralized one is predetermined. Decentralization implies the change in the role of today’s consumers. They become energy prosumers. This is the basis for the crowd energy concept. In this position paper the crowd energy concept is introduced and necessary research fields are identified.
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The phenomenon of increasing customers of take-over financing from conventional banks to Islamic banks is an interesting trend to study. This research purpose is to investigate the influence of murabahah financing margins, customer religiosity to customer interest and decision making. The method used is a sequential mixed method. The instrument quantitative is a questionnaire, and the qualitative method is an interview. 199 pensioner customers participated in the survey. Internal consistency is measured by Cronbach’s alpha value. The accuracy of the structural equation modeling (SEM) and hypothesis testing was evaluated using AMOS version 23. The research findings indicate, there was a significant influence between customer religiosity on customer interest and customer interest on decision making. Meanwhile, the murabahah financing margin has no significant influence on customer interest and decision making, as well as between customer religiosity and decision making. Murabahah financing margins and customer religiosity have an influence of significance when mediated by the variable of customer interest. In conclusion, Murabahah financing margin, and customer religiosity does not have a direct significant influence on decision making without being mediated by the variable of customer interest. These results indicate that Islamic bank managers can take advantage of this research variable to increase customer interest so that customer decision making also increases. This study has practical implications for conventional banks and sharia banks. Sharia banks are an opportunity to attract customers from conventional banks, while conventional banks are a challenge because their customers have the potential to take over Islamic banks. AcknowledgmentsThe authors are grateful to the Rector of the State Islamic Institute of Sultan Amai Gorontalo, and the State Islamic University of Alauddin Makassar for funding this research collaboratively, and to the respondents who have taken the time to fill out the research questionnaire so that research data can be collected.
Smart Cities werden an der Beantwortung der Elektrizitätsfrage gemessen. Entscheidend ist die optimale Technologienutzung, um lokal Elektrizität zu produzieren, zu verbrauchen und zu speichern. Endverbraucher werden zu Prosumer. Dies verändert den Energiemarkt radikal mit der Notwendigkeit für neue Konzepte wie das Crowd Energy (CE)-Konzept als Bottom-up-Ansatz: Durch kollektive Anstrengung ist eine größere Effizienz in der Energienutzung möglich. Das Buchkapitel beschreibt zuerst die Grundlagen einer CE-Kooperation sowie die Einbindung von CE-Kooperationen in das Wertschöpfungsnetz. Die Analyse der Akteure und Wertegenerierung zeigt, dass Prosumer das Rückgrat einer Crowd sind und entscheidenden Einfluss auf Informations- und Stromaustausch haben. Das in Bezug stehende Entscheidungsverhalten von Prosumern basiert dabei neben wirtschaftlichen hauptsächlich auf sozialen Faktoren. Es wird erläutert, welche Faktoren in Zukunft ausschlaggebend sind. Neben Stromaustausch basiert eine CE-Kooperation auf einem erhöhten Informationsaustausch, mit den bekannten Risiken bzgl. Cyber-Attacken. Neben rein technischen Abwehrmaßnahmen muss ein umfassendes Informationssicherheitsmanagement installiert sein, um Funktion und Erfolg einer Crowd zu gewährleisten. Mit der Beleuchtung dieses Themenbereichs schließt der Beitrag.
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After the Fukushima disaster, European politicians began to reassess the energy strategy for their countries. The focus is now on renewable energy sources and as a result on decentralization. The decentralized generation, storage, and of course the consumption of energy is the central point. Now with the new developments under the roof of energy turnaround the way back from the centralized architecture of our energy system to a more decentralized one is predetermined. Decentralization implies the change in the role of today’s consumers. They become energy prosumers. This is the basis for the crowd energy concept. In this position paper the crowd energy concept is introduced and necessary research fields are identified.
Conference Paper
The use of energy storage devices in homes has been advocated as one of the main ways of saving energy and reducing the reliance on fossil fuels in the future Smart Grid. However, if micro-storage devices are all charged at the same time using power from the electricity grid, it means a higher demand and, hence, more generation capacity, more carbon emissions, and, in the worst case, breaking down the system due to over-demand. To alleviate such issues, in this paper, we present a novel agent-based micro-storage management technique that allows all (individually-owned) storage devices in the system to converge to profitable, efficient behaviour. Specifically, we provide a general framework within which to analyse the Nash equilibrium of an electricity grid and devise new agent-based storage learning strategies that adapt to market conditions. Taken altogether, our solution shows that, specifically, in the UK electricity market, it is possible to achieve savings of up to 13% on average for a consumer on his electricity bill with a storage device of 4 kWh. Moreover, we show that there exists an equilibrium where only 38% of UK households would own storage devices and where social welfare would be also maximised (with an overall annual savings of nearly GBP 1.5B at that equilibrium).
Conference Paper
After the Fukushima disaster, European politicians began to reassess the energy strategy for their countries. The focus is now on renewable energy sources and as a result on decentralization. The decentralized generation, storage, and of course the consumption of energy is the central point. Now with the new developments under the roof of energy turnaround the way back from the centralized architecture of our energy system to a more decentralized one is predetermined. Decentralization implies the change in the role of today’s consumers. They become energy prosumers. This is the basis for the crowd energy concept. In this position paper the crowd energy concept is introduced and necessary research fields are identified.
Conference Paper
The Smart Grid Metric is a tool for systematically measuring the impact of smart grid technologies on the performance of distribution grids. For metric calibration, synthetic medium voltage (MV) test grids with distributed generation are modeled, using different approaches for urban and rural MV grids. The Smart Grid Metric is exemplarily applied to two rural test grids to demonstrate the impact of reactive power management by distributed generation on grid voltages and metric results as one example of smart grid technologies.
Demand-side management, together with the integration of distributed energy generation and storage, are considered increasingly essential elements for implementing the smart grid concept and balancing massive energy production from renewable sources. We focus on a smart grid in which the demand-side comprises traditional users as well as users owning some kind of distributed energy sources and/or energy storage devices. By means of a day-ahead optimization process regulated by an independent central unit, the latter users intend to reduce their monetary energy expense by producing or storing energy rather than just purchasing their energy needs from the grid. In this paper, we formulate the resulting grid optimization problem as a noncooperative game and analyze the existence of optimal strategies. Furthermore, we present a distributed algorithm to be run on the users' smart meters, which provides the optimal production and/or storage strategies, while preserving the privacy of the users and minimizing the required signaling with the central unit. Finally, the proposed day-ahead optimization is tested in a realistic situation.
La investigación se centra en la estimación de los costes futuros de generación eléctrica basándose en las tecnologías y tipos de centrales de generación que podrían conectarse a la red en el periodo 2005-2010. Incluye centrales de carbón avanzadas, centrales de ciclo combinado, centrales nucleares y tecnologías basadas en fuentes de energía renovables. En el libro se muestran y analizan los costes proyectados de generación eléctrica calculados con los supuestos técnicos y económicos más probables. Se examinan los efectos sobre los costes de las variaciones en los parámetros técnicos y económicos así como las tendencias en costes de generación por tipo de central: carbón, gas y nuclear. Expertos procedentes de 19 países proporcionaron los costes estimados de inversión, de operación y mantenimiento y de combustible de más de 70 centrales de generación eléctrica. Se ha utilizado un método uniforme y coherente para calcular costes por kWh comparables