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Determinants of voluntary electricity demand management program participation

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  • Leonard, J. Mark
  • Decker, Christopher S.

Abstract

This paper examines the voluntary electricity demand management decisions of commercial and industrial customers (at the firm and facility level) of an electric utility serving a United States Midwestern metropolitan area. Using standard probit analysis, we find that electricity costs are a major determinant of a firm’s decision to voluntarily engage in demand management programs. Specifically, an additional $100,000 in electricity costs raises the probability of participation in an electricity demand management program by 0.3 percent. We also find that companies with multiple sites are 3.7 percent more likely to participate. In terms of demand management program participation, these results indicate a difference between organization and size that warrants further examination.

Suggested Citation

  • Leonard, J. Mark & Decker, Christopher S., 2012. "Determinants of voluntary electricity demand management program participation," Utilities Policy, Elsevier, vol. 20(1), pages 17-21.
    • Handle: RePEc:eee:juipol:v:20:y:2012:i:1:p:17-21
    DOI: 10.1016/j.jup.2011.10.001
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    References listed on IDEAS

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    Cited by:

    1. Yuan Liu & Qinliang Tan & Jian Han & Mingxin Guo, 2021. "Energy–Water–CO 2 Synergetic Optimization Based on a Mixed-Integer Linear Resource Planning Model Concerning the Demand Side Management in Beijing’s Power Structure Transformation," Energies, MDPI, vol. 14(11), pages 1-17, June.
    2. Earnhart, Dietrich & Mark Leonard, J., 2016. "Environmental audits and signaling: The role of firm organizational structure," Resource and Energy Economics, Elsevier, vol. 44(C), pages 1-22.
    3. Carrión-Flores, Carmen E. & Innes, Robert & Sam, Abdoul G., 2013. "Do voluntary pollution reduction programs (VPRs) spur or deter environmental innovation? Evidence from 33/50," Journal of Environmental Economics and Management, Elsevier, vol. 66(3), pages 444-459.
    4. Torriti, Jacopo, 2013. "The significance of occupancy steadiness in residential consumer response to Time-of-Use pricing: Evidence from a stochastic adjustment model," Utilities Policy, Elsevier, vol. 27(C), pages 49-56.
    5. Bjoern Felten & Jessica Raasch & Christoph Weber, 2017. "Photovoltaics and Heat Pumps - Limitations of Local Pricing Mechanisms," EWL Working Papers 1702, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Feb 2017.

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