A Rate Design to Increase Efficiency and Reduce Revenue Requirements

David Magnus Boonin

The Electricity Journal, 2009, vol. 22, issue 4, 68-78

Abstract: One decoupling approach, a Straight Fixed Variable (SFV) rate design, is a rational way to recover fixed and variable costs because it aligns pricing with variable and fixed cost causation, thereby removing the utility's profit sensitivity to reduced sales. The problem with SFV is that it reduces the variable charge to short-term variable cost, leading to overconsumption. Revenue-neutral energy efficiency "feebates" combining fees and rebates offer an economic incentive for consumer energy efficiency.

Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1040-6190(09)00091-8
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jelect:v:22:y:2009:i:4:p:68-78

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

Access Statistics for this article

The Electricity Journal is currently edited by R. Cohen

More articles in The Electricity Journal from Elsevier
Bibliographic data for series maintained by Catherine Liu ().