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The Hopkinson tariff alternative to TOU rates in the Israel Electric Corporation

Author

Listed:
  • C.K. Woo

    (Energy and Environmental Economics, Inc., 353 Sacramento Street, Suite 1700, San Francisco, CA 94111, USA)

  • Brian Horii

    (Energy and Environmental Economics, Inc., 353 Sacramento Street, Suite 1700, San Francisco, CA 94111, USA)

  • Ira Horowitz

    (Decision and Information Sciences, Warrington College of Business Administration, University of Florida, Gainesville, FL 32611, USA)

Abstract

This paper determines three alternative Hopkinson tariffs to replace the Israel Electric Corporation's time-of-use (TOU) energy rate. The first apportions any system residual revenue requirement between customer classes, based on their respective historic peak demands. The second collects the same revenue as the current TOU rates. The third allocates generation revenue requirements for base-load and peaking generation plants in proportion to the base-load and peak-period energy consumption of each class, and allocates transmission and distribution revenue requirements in proportion to the connected load of each class. We show that a Hopkinson tariff with demand subscription is an attractive alternative to TOU rates, especially when quantity rationing is essential to maintaining a balance between the provision of energy and the demand for it. Copyright © 2002 John Wiley & Sons, Ltd.

Suggested Citation

  • C.K. Woo & Brian Horii & Ira Horowitz, 2002. "The Hopkinson tariff alternative to TOU rates in the Israel Electric Corporation," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 23(1), pages 9-19.
    • Handle: RePEc:wly:mgtdec:v:23:y:2002:i:1:p:9-19
    DOI: 10.1002/mde.1040
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    References listed on IDEAS

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    Cited by:

    1. Woo, C.K & Lloyd, D & Karimov, R & Tishler, A, 2003. "Stranded cost recovery in electricity market reforms in the US," Energy, Elsevier, vol. 28(1), pages 1-14.
    2. David, Laurent & Le Breton, Michel & Merillon, Olivier, 2007. "Regulating the Natural Gas Transportation Industry: Optimal Pricing Policy of a Monopolist with Advance-Purchase and Spot Markets," IDEI Working Papers 488, Institut d'Économie Industrielle (IDEI), Toulouse.
    3. David, Laurent & Le Breton, Michel & Merillon, Olivier, 2007. "Public Utility Pricing and Capacity Choice with Stochastic Demand," IDEI Working Papers 489, Institut d'Économie Industrielle (IDEI), Toulouse.
    4. Guo, Peiyang & Li, Victor O.K. & Lam, Jacqueline C.K., 2017. "Smart demand response in China: Challenges and drivers," Energy Policy, Elsevier, vol. 107(C), pages 1-10.
    5. Brown, David P. & Sappington, David E.M., 2018. "On the role of maximum demand charges in the presence of distributed generation resources," Energy Economics, Elsevier, vol. 69(C), pages 237-249.
    6. 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.
    7. Antweiler, Werner, 2017. "A two-part feed-in-tariff for intermittent electricity generation," Energy Economics, Elsevier, vol. 65(C), pages 458-470.
    8. Horowitz, I. & Woo, C.K., 2006. "Designing Pareto-superior demand-response rate options," Energy, Elsevier, vol. 31(6), pages 1040-1051.

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