Commercial/Industrial Customer Response to Time-Of-Use Electricity Prices: Some Experimental Results

Dennis J. Aigner and Joseph Hirschberg

RAND Journal of Economics, 1985, vol. 16, issue 3, 341-355

Abstract: This article analyzes a time-of-use pricing experiment involving over 700 small and medium size commercial/industrial firms. Two basic rate structures were implemented: one with time-varying demand (kW) charges and a flat energy (kWh) charge, and the other with time-varying energy charges and a flat kW charge. A small but statistically significant elasticity of substitution between peak and offpeak (kWh) consumption is estimated for the Summer season in the overall sample for firms facing the time-of-use demand rate. A substantially larger response is estimated in the Summer season for the subgroup of "large" firms in the experiment that faced a time-of-use demand rate, and this response translates into a welfare gain that in just the first year more than offsets the additional metering costs involved under mandatory implementation.

Date: 1985
References: Add references at CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://links.jstor.org/sici?sici=0741-6261%2819852 ... O%3B2-9&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

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:rje:randje:v:16:y:1985:i:autumn:p:341-355

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in RAND Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().