Consumer Response to Time Varying Prices for Electricity

Rob Lawson (), Paul Thorsnes () and John Williams ()
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Rob Lawson: Department of Marketing, University of Otago
Paul Thorsnes: Department of Economics, University of Otago
John Williams: Department of Marketing, University of Otago

No 1116, Working Papers from University of Otago, Department of Economics

Abstract: We report new experimental evidence of the household response to weekday differentials in peak and off-peak electricity prices. The data come from Auckland, New Zealand, where peak residential electricity consumption occurs in winter for heating. Peak/off-peak price differentials ranged over four randomly-selected groups from 1.0 to 3.5. On average, there was no response except in winter. In winter, participant households reduced electricity consumption by at least 10%, took advantage of lower off-peak prices but did not respond to the peak price differentials. Response varied with house and household size, time spent away from home, and whether water was heated with electricity.

Keywords: Electricity pricing; Time of Use; Price elasticity (search for similar items in EconPapers)
Pages: 25 pages
Date: 2011-12, Revised 2011-12
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http://www.otago.ac.nz/economics/research/otago076674.pdf First version, 2011 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:otg:wpaper:1116

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