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“Wild” tariff schemes: Evidence from the Republic of Georgia

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  • Alberini, Anna
  • Bezhanishvili, Levan
  • Ščasný, Milan

Abstract

Consumers often struggle to grasp complicated pricing plans, including increasing block rate (IBR) schemes, which have been used for decades by utilities in many parts of the world. The assumption that they encourage conservation has, however, recently been challenged (Ito, 2014). We take advantage of the unique IBR tariffs for electricity in the Republic of Georgia—where “overage” is penalized more heavily than in conventional IBRs—to ask whether consumers respond to price, and to which price specifically.

Suggested Citation

  • Alberini, Anna & Bezhanishvili, Levan & Ščasný, Milan, 2022. "“Wild” tariff schemes: Evidence from the Republic of Georgia," Energy Economics, Elsevier, vol. 110(C).
  • Handle: RePEc:eee:eneeco:v:110:y:2022:i:c:s0140988322001992
    DOI: 10.1016/j.eneco.2022.106030
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    More about this item

    Keywords

    Residential electricity demand; Price elasticity; Increasing block rates; Tariff schemes; Symmetric response to price changes; Difference-in-difference;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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