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The Power of Dynamic Pricing

Author

Listed:
  • Faruqui, Ahmad
  • Hledik, Ryan
  • Tsoukalis, John

Abstract

Using data from a generic California utility, it can be shown that it is feasible to develop dynamic pricing rates for all customer classes. These rates have the potential to reduce system peak demands from 1 to 9 percent.

Suggested Citation

  • Faruqui, Ahmad & Hledik, Ryan & Tsoukalis, John, 2009. "The Power of Dynamic Pricing," The Electricity Journal, Elsevier, vol. 22(3), pages 42-56, April.
    • Handle: RePEc:eee:jelect:v:22:y:2009:i:3:p:42-56
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    Citations

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    Cited by:

    1. Thorsnes, Paul & Williams, John & Lawson, Rob, 2012. "Consumer responses to time varying prices for electricity," Energy Policy, Elsevier, vol. 49(C), pages 552-561.
    2. Faruqui, Ahmad & Harris, Dan & Hledik, Ryan, 2010. "Unlocking the [euro]53 billion savings from smart meters in the EU: How increasing the adoption of dynamic tariffs could make or break the EU's smart grid investment," Energy Policy, Elsevier, vol. 38(10), pages 6222-6231, October.
    3. Chassin, David P. & Rondeau, Daniel, 2016. "Aggregate modeling of fast-acting demand response and control under real-time pricing," Applied Energy, Elsevier, vol. 181(C), pages 288-298.
    4. Rob Lawson & Paul Thorsnes & John Williams, 2011. "Consumer Response to Time Varying Prices for Electricity," Working Papers 1116, University of Otago, Department of Economics, revised Dec 2011.
    5. Brandstätt, Christine & Brunekreeft, Gert & Friedrichsen, Nele, 2011. "Locational signals to reduce network investments in smart distribution grids: What works and what not?," Utilities Policy, Elsevier, vol. 19(4), pages 244-254.
    6. Kaicker, Nidhi & Dutta, Goutam & Das, Debamanyu & Banerjee, Subhashree, 2017. "Mathematical Modelling for Time-of-Use Pricing of Electricity in Monopoly and Oligopoly," IIMA Working Papers WP 2017-10-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    7. Clastres, Cédric & Khalfallah, Haikel, 2015. "An analytical approach to activating demand elasticity with a demand response mechanism," Energy Economics, Elsevier, vol. 52(PA), pages 195-206.
    8. Paul Lehmann & Felix Creutzig & Melf-Hinrich Ehlers & Nele Friedrichsen & Clemens Heuson & Lion Hirth & Robert Pietzcker, 2012. "Carbon Lock-Out: Advancing Renewable Energy Policy in Europe," Energies, MDPI, vol. 5(2), pages 1-32, February.
    9. Ali Fattahi & Sriram Dasu & Reza Ahmadi, 2023. "Peak-Load Energy Management by Direct Load Control Contracts," Management Science, INFORMS, vol. 69(5), pages 2788-2813, May.
    10. Cédric Clastres & Haikel Khalfallah, 2015. "An Analytical Approach to Activating Demand Elasticity with a Demand Response Mechanism," Post-Print hal-01222582, HAL.
    11. Katz, Jonas & Andersen, Frits Møller & Morthorst, Poul Erik, 2016. "Load-shift incentives for household demand response: Evaluation of hourly dynamic pricing and rebate schemes in a wind-based electricity system," Energy, Elsevier, vol. 115(P3), pages 1602-1616.
    12. Lavin, Luke & Apt, Jay, 2021. "The importance of peak pricing in realizing system benefits from distributed storage," Energy Policy, Elsevier, vol. 157(C).
    13. Kim, Min-Jeong, 2017. "A field study using an adaptive in-house pricing model for commercial and industrial customers in Korea," Energy Policy, Elsevier, vol. 102(C), pages 189-198.
    14. Vardakas, John S. & Zorba, Nizar & Verikoukis, Christos V., 2014. "Scheduling policies for two-state smart-home appliances in dynamic electricity pricing environments," Energy, Elsevier, vol. 69(C), pages 455-469.
    15. Peter Seele & Claus Dierksmeier & Reto Hofstetter & Mario D. Schultz, 2021. "Mapping the Ethicality of Algorithmic Pricing: A Review of Dynamic and Personalized Pricing," Journal of Business Ethics, Springer, vol. 170(4), pages 697-719, May.
    16. Bayram, Islam Safak & Ustun, Taha Selim, 2017. "A survey on behind the meter energy management systems in smart grid," Renewable and Sustainable Energy Reviews, Elsevier, vol. 72(C), pages 1208-1232.
    17. Derya Eryilmaz, Timothy M. Smith, and Frances R. Homans, 2017. "Price Responsiveness in Electricity Markets: Implications for Demand Response in the Midwest," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    18. Brennan, Tim, 2022. "Is Transmission Expansion for Decarbonization Compatible with Generation Competition?," RFF Working Paper Series 22-12, Resources for the Future.
    19. Silva, Hendrigo Batista da & Santiago, Leonardo P., 2018. "On the trade-off between real-time pricing and the social acceptability costs of demand response," Renewable and Sustainable Energy Reviews, Elsevier, vol. 81(P1), pages 1513-1521.
    20. Kopsakangas Savolainen, Maria & Svento, Rauli, 2012. "Real-Time Pricing in the Nordic Power markets," Energy Economics, Elsevier, vol. 34(4), pages 1131-1142.
    21. Alessandro Pitì & Giacomo Verticale & Cristina Rottondi & Antonio Capone & Luca Lo Schiavo, 2017. "The Role of Smart Meters in Enabling Real-Time Energy Services for Households: The Italian Case," Energies, MDPI, vol. 10(2), pages 1-25, February.
    22. Daniel Adelman & Canan Uçkun, 2019. "Dynamic Electricity Pricing to Smart Homes," Operations Research, INFORMS, vol. 67(6), pages 1520-1542, November.

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