IDEAS home Printed from https://ideas.repec.org/a/kap/regeco/v27y2005i3p235-262.html
   My bibliography  Save this article

24/7 Hourly Response to Electricity Real-Time Pricing with up to Eight Summers of Experience

Author

Listed:
  • Thomas Taylor
  • Peter Schwarz
  • James Cochell

Abstract

This paper provides hourly own and cross price elasticities for industrial customers with up to 8 years of experience on Duke Power optional real-time rates. We include the effects of customer characteristics and temperature conditions. Aggregated results show larger own elasticities than have previous studies, complementarity within the potential peak hours and substitution in the late evening. As customers gain experience with hourly pricing, they show larger load reductions during higher priced hours. As compared to a TOU rate, net benefits are $14,000 per customer per month, approximately 4% of the average customer’s bill, and much greater than metering costs. Copyright Springer Science+Business Media, Inc. 2005

Suggested Citation

  • Thomas Taylor & Peter Schwarz & James Cochell, 2005. "24/7 Hourly Response to Electricity Real-Time Pricing with up to Eight Summers of Experience," Journal of Regulatory Economics, Springer, vol. 27(3), pages 235-262, January.
    • Handle: RePEc:kap:regeco:v:27:y:2005:i:3:p:235-262
    DOI: 10.1007/s11149-005-6623-6
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11149-005-6623-6
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11149-005-6623-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Herriges, Joseph A, et al, 1993. "The Response of Industrial Customers to Electric Rates Based upon Dynamic Marginal Costs," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 446-454, August.
    2. Robert H. Patrick & Frank A. Wolak, 2001. "Estimating the Customer-Level Demand for Electricity Under Real-Time Market Prices," NBER Working Papers 8213, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pascal Courty & Mario Pagliero, 2011. "Does responsive pricing smooth demand shocks?," Applied Economics, Taylor & Francis Journals, vol. 43(30), pages 4707-4721.
    2. Hunt Allcott, 2012. "The Smart Grid, Entry, and Imperfect Competition in Electricity Markets," NBER Working Papers 18071, National Bureau of Economic Research, Inc.
    3. Emmanuele Bobbio & Simon Brandkamp & Stephanie Chan & Peter Cramton & David Malec & Lucy Yu, 2022. "Price Responsive Demand in Britain's Electricity Market," ECONtribute Discussion Papers Series 185, University of Bonn and University of Cologne, Germany.
    4. Allcott, Hunt, 2011. "Rethinking real-time electricity pricing," Resource and Energy Economics, Elsevier, vol. 33(4), pages 820-842.
    5. Zhou, Yang & Ma, Rong & Su, Yun & Wu, Libo, 2019. "Too big to change: How heterogeneous firms respond to time-of-use electricity price," China Economic Review, Elsevier, vol. 58(C).
    6. Courty, Pascal & Pagliero, Mario, 2003. "Does Responsive Pricing Increase Efficiency? Evidence from Pricing Experiments in an Internet Café," CEPR Discussion Papers 4149, C.E.P.R. Discussion Papers.
    7. Wai Choi & Anindya Sen & Adam White, 2011. "Response of industrial customers to hourly pricing in Ontario’s deregulated electricity market," Journal of Regulatory Economics, Springer, vol. 40(3), pages 303-323, December.
    8. Jordehi, A. Rezaee, 2019. "Optimisation of demand response in electric power systems, a review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 103(C), pages 308-319.
    9. Sgouridis, Sgouris & Kennedy, Scott, 2010. "Tangible and fungible energy: Hybrid energy market and currency system for total energy management. A Masdar City case study," Energy Policy, Elsevier, vol. 38(4), pages 1749-1758, April.
    10. Vítor Marques & Isabel Soares & Adelino Fortunato, 2012. "Application of a Structural Model to the Spanish Electricity Wholesale Market," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 65-108.
    11. Pereira, Adelino J.C. & Saraiva, João Tomé, 2011. "Generation expansion planning (GEP) – A long-term approach using system dynamics and genetic algorithms (GAs)," Energy, Elsevier, vol. 36(8), pages 5180-5199.
    12. Vítor Marques & Adelino Fortunato & Isabel Soares, 2012. "Can Structural Models be Useful to Understand the Electricity Wholesale Markets? An Application to Spain," Chapters, in: Joseph E. Harrington Jr & Yannis Katsoulacos (ed.), Recent Advances in the Analysis of Competition Policy and Regulation, chapter 15, Edward Elgar Publishing.
    13. James B. Bushnell & Erin T. Mansur, 2005. "Consumption Under Noisy Price Signals: A Study Of Electricity Retail Rate Deregulation In San Diego," Journal of Industrial Economics, Wiley Blackwell, vol. 53(4), pages 493-513, December.
    14. Daiya Isogawa & Hiroshi Ohashi & Tokunari Anai, 2024. "The Role of Advance Notice in Shaping Industrial Response to Time-Varying Electricity Prices," CIRJE F-Series CIRJE-F-1226, CIRJE, Faculty of Economics, University of Tokyo.
    15. Frank A. Wolak, 2000. "Market Design and Price Behavior in Restructured Electricity Markets: An International Comparison," NBER Chapters, in: Deregulation and Interdependence in the Asia-Pacific Region, pages 79-137, National Bureau of Economic Research, Inc.
    16. Robert H. Patrick & Frank A. Wolak, 2001. "Estimating the Customer-Level Demand for Electricity Under Real-Time Market Prices," NBER Working Papers 8213, National Bureau of Economic Research, Inc.
    17. Orvika Rosnes, 2014. "Subsidies for renewable energy in inflexible power markets," Journal of Regulatory Economics, Springer, vol. 46(3), pages 318-343, December.
    18. Cullen, Joseph A. & Reynolds, Stanley S., 2023. "Market dynamics and investment in the electricity sector," International Journal of Industrial Organization, Elsevier, vol. 89(C).
    19. Carlo Fezzi & Derek Bunn, 2010. "Structural Analysis of Electricity Demand and Supply Interactions," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 72(6), pages 827-856, December.
    20. Krishnamurthy, Chandra Kiran B. & Vesterberg, Mattias & Böök, Herman & Lindfors, Anders V. & Svento, Rauli, 2018. "Real-time pricing revisited: Demand flexibility in the presence of micro-generation," Energy Policy, Elsevier, vol. 123(C), pages 642-658.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:regeco:v:27:y:2005:i:3:p:235-262. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.