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The Alchemy of Demand Response: Turning Demand into Supply

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  • Rochlin, Cliff

Abstract

Paying customers to refrain from purchasing products they want seems to run counter to the normal operation of markets. Demand response should be interpreted not as a supply-side resource but as a secondary market that attempts to correct the misallocation of electricity among electric users caused by regulated average rate tariffs. In a world with costless metering, the DR solution results in inefficiency as measured by deadweight losses.

Suggested Citation

  • Rochlin, Cliff, 2009. "The Alchemy of Demand Response: Turning Demand into Supply," The Electricity Journal, Elsevier, vol. 22(9), pages 10-25, November.
    • Handle: RePEc:eee:jelect:v:22:y:2009:i:9:p:10-25
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    Cited by:

    1. repec:spo:wpecon:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    2. Salies, Evens, 2013. "Real-time pricing when some consumers resist in saving electricity," Energy Policy, Elsevier, vol. 59(C), pages 843-849.
    3. repec:hal:spmain:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    4. repec:spo:wpmain:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    5. repec:hal:wpspec:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    6. David Ribó-Pérez & Luis Larrosa-López & David Pecondón-Tricas & Manuel Alcázar-Ortega, 2021. "A Critical Review of Demand Response Products as Resource for Ancillary Services: International Experience and Policy Recommendations," Energies, MDPI, vol. 14(4), pages 1-25, February.
    7. Evens Salies, 2012. "Real-time pricing when consumers have saving costs," Working Papers hal-01070292, HAL.
    8. Wang, Yong & Li, Lin, 2015. "Time-of-use electricity pricing for industrial customers: A survey of U.S. utilities," Applied Energy, Elsevier, vol. 149(C), pages 89-103.
    9. Claire Bergaentzlé, 2013. "From smart technology to smart consumers: for better system reliability and improved market efficiency," Post-Print halshs-01011169, HAL.

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