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Retail electricity competition
Author(s) -
Joskow Paul,
Tirole Jean
Publication year - 2006
Publication title -
the rand journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.687
H-Index - 108
eISSN - 1756-2171
pISSN - 0741-6261
DOI - 10.1111/j.1756-2171.2006.tb00058.x
Subject(s) - electricity , competition (biology) , rationing , profiling (computer programming) , incentive , business , industrial organization , metering mode , consumption (sociology) , electricity retailing , microeconomics , economics , commerce , electricity market , computer science , engineering , ecology , electrical engineering , biology , mechanical engineering , health care , social science , sociology , economic growth , operating system
We analyze a number of unstudied aspects of retail electricity competition. We first explore the implications of load profiling of consumers whose traditional meters do not permit the measurement of their real‐time consumption. The combination of retail competition and load profiling does not yield the second‐best prices given the non‐price‐responsiveness of retail consumers. We then examine the incentives that electricity retailers have to install each of two types of advanced metering equipment. Finally, we consider the implications of physical limitations on the ability of system operators to cut off individual consumers relying instead on “zonal” rationing of large groups of individual consumers