Time of use pricing and likelihood of shifting energy activities, strategies, and timing

Mahmood Muttaqee, Greg Stelmach, Chad Zanocco, June Flora, Ram Rajagopal and Hilary S. Boudet

Energy Policy, 2024, vol. 187, issue C

Abstract: Time of Use (TOU) pricing charges higher electricity rates during peak demand windows. Utilities are increasingly deploying TOU pricing to match demand to supplies from renewables. From a survey of 804 California households, we analyze respondents’ reported likelihood of shifting energy-using activities under TOU pricing, their preferred time slots and strategies for shifting. Among the activities offered, respondents reported the most flexibility for shifting cleaning activities and the least for entertainment and cooking. Most preferred midday or late night to shift. Favored strategies included using appliances more efficiently, manually shifting activities, and changing appliance settings over costlier or technology-oriented strategies. Respondents from lower income households, those who owned or intended to purchase more smart home technologies, and those that adhered to rules pertaining to electricity use reported more willingness to shift activities. Our findings suggest that TOU policies could have less impact than predicted since some respondents already completed major energy-using activities outside TOU windows and were unwilling to shift others. Moreover, the popularity of late-night shifts might create alternative peaks that could strain renewable sources, particularly in combination with electric vehicle adoption and charging. The higher willingness expressed by low-income households suggests potential equity concerns of TOU policies.

Keywords: Time-of-use pricing; Demand response; California; Equity; Energy behaviors; Energy activities (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:187:y:2024:i:c:s0301421524000399

DOI: 10.1016/j.enpol.2024.114019

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