 Dynamic pricing of electricity: Enabling demand response in domestic householdsMaximilian J. Blaschke Energy Policy, 2022, vol. 164, issue C Abstract: Fluctuations in retail energy prices may incentivize domestic households to adapt their load pattern in order to minimize the cost of electricity. This paper determines the price volatility necessary for automatic load shifting to cover the cost of the associated smart metering within a household. This study shows that current price volatility does not allow sufficient savings to compensate for additional metering costs. However, results indicate that a change towards an ‘ad-valorem’ electricity taxation dependent on exchange prices could make residential demand-side management profitable. At the same time, the potential price risk for consumers that do not react to pricing signals because of a lack of smart devices, is almost negligible. As consumption patterns suggest, these households consume in times of both high and low prices, thereby almost canceling out higher payments at peak times even without any load shifts. With these results, policymakers can anticipate the effects of dynamic retail prices on electricity and derive the implications of different taxation settings. Keywords: Energy taxes; Demand response; Dynamic tariff; Smart meter; Smart appliances; Residential; Taxation mechanism; Financial incentives (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:164:y:2022:i:c:s0301421522001033 DOI: 10.1016/j.enpol.2022.112878 Access Statistics for this article Energy Policy is currently edited by N. France More articles in Energy Policy from Elsevier |
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