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Peak and Off-Peak Industrial Demand for Electricity: The Hopkinson Rate in Ontario, Canada

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  • Dean C. Mountain
  • Cheng Hsiao

Abstract

The Hopkinson rate consists of an energy charge for every kilowatthour of electricity a customer uses, plus an additional demand charge, a peak-demand charge on the maximum usage during the month. Historically, industries in North America have generally been charged a Hopkinson rate for electricity use. In 1983, for example, 97 percent (see Blinder [1984]) of the publicly owned electric utilities in North America had demand charges in their commercial/industrial rate structure, whereas only 11 percent had time-of-day rates. However, with the exception of papers by Corio and Trimnell (1978) and Veall (1981), the focus of empirical research on industrial firms (like the focus of research in the residential sector) has been on examining the impact of time-of-use rates (e.g. Chung [1978], Chung and Aigner [1981], and Panzar and Willig [1979]).

Suggested Citation

  • Dean C. Mountain & Cheng Hsiao, 1986. "Peak and Off-Peak Industrial Demand for Electricity: The Hopkinson Rate in Ontario, Canada," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 149-168.
    • Handle: RePEc:aen:journl:1986v07-01-a10
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    Cited by:

    1. Woo, C.K. & Sreedharan, P. & Hargreaves, J. & Kahrl, F. & Wang, J. & Horowitz, I., 2014. "A review of electricity product differentiation," Applied Energy, Elsevier, vol. 114(C), pages 262-272.
    2. Oshiro, Asahi & Tarui, Nori, 2023. "Effects of alternative pricing structures on electricity consumption and payments in the commercial and industrial sector," Japan and the World Economy, Elsevier, vol. 68(C).

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    JEL classification:

    • F0 - International Economics - - General

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