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INDUSTRIAL RESPONSE TO ELECTRICITY REAL‐TIME PRICES: SHORT RUN AND LONG RUN
Author(s) -
Schwarz Peter M.,
Taylor Thomas N.,
Birmingham Matthew,
Dardan Shana L.
Publication year - 2002
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1093/ei/40.4.597
Subject(s) - economics , short run , electricity , production (economics) , econometrics , demand response , microeconomics , agricultural economics , monetary economics , engineering , electrical engineering
Real‐time pricing reduces summer peak demand by approximately 8% for 110 Duke Energy industrial customers. With up to six summers on the rate, the aggregate customer response increases with experience. Examining individual customers, only a subset respond significantly, primarily those who can self‐generate or with discrete (batch) production processes. These customers respond significantly above a threshold level of price. Although elasticities decrease slightly at the highest temperatures, the absolute quantity reductions are largest at these times.