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Real-time pricing when some consumers resist in saving electricity

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  • Salies, Evens

Abstract

Successful real-time electricity pricing depends firstly upon consumers' willingness to subscribe to such terms and, secondly, on their ability to curb consumption levels. The present paper addresses both issues by considering consumers differentiated by their electricity saving costs, half of whom resist saving electricity. We demonstrate that when consumers are free to adopt real-time prices, producers prefer charging inefficient prices and, in so doing, discriminate against that portion of the consumer population which faces no saving costs. We also find that efficient marginal cost pricing is feasible, but is incompatible with mass adoption of real-time prices.

Suggested Citation

  • Salies, Evens, 2013. "Real-time pricing when some consumers resist in saving electricity," Energy Policy, Elsevier, vol. 59(C), pages 843-849.
  • Handle: RePEc:eee:enepol:v:59:y:2013:i:c:p:843-849
    DOI: 10.1016/j.enpol.2013.04.050
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    References listed on IDEAS

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    Cited by:

    1. Hobman, Elizabeth V. & Frederiks, Elisha R. & Stenner, Karen & Meikle, Sarah, 2016. "Uptake and usage of cost-reflective electricity pricing: Insights from psychology and behavioural economics," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 455-467.
    2. Chmielewski, Adrian & Gumiński, Robert & Mączak, Jędrzej & Radkowski, Stanisław & Szulim, Przemysław, 2016. "Aspects of balanced development of RES and distributed micro-cogeneration use in Poland: Case study of a µCHP with Stirling engine," Renewable and Sustainable Energy Reviews, Elsevier, vol. 60(C), pages 930-952.
    3. Schleich, Joachim & Klobasa, Marian & Gölz, Sebastian & Brunner, Marc, 2013. "Effects of feedback on residential electricity demand—Findings from a field trial in Austria," Energy Policy, Elsevier, vol. 61(C), pages 1097-1106.
    4. repec:eee:enepol:v:106:y:2017:i:c:p:244-254 is not listed on IDEAS
    5. Cl'emence Alasseur & Ivar Ekeland & Romuald Elie & Nicol'as Hern'andez Santib'a~nez & Dylan Possamai, 2017. "An adverse selection approach to power pricing," Papers 1706.01934, arXiv.org, revised Jun 2018.
    6. repec:eee:rensus:v:81:y:2018:i:p1:p:1513-1521 is not listed on IDEAS

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