Capacity Constraints and Electrification: Evidence from Residential Electricity Demand and Pricing

Marten Ovaere and Mark Vergouwen

Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium from Ghent University, Faculty of Economics and Business Administration

Abstract: We study how electrification and pricing affect household peak electricity demand, and whether these effects strain local electric grids. Using high-frequency consumption data from over 42,000 households, we find that adopting an electric vehicle raises a household’s monthly peak by about 2 kilowatts. Real-time prices also raise household peak demand, but have limited grid-level effects. Peak demand charges reduce peaks by 3 percent on average, and by 5 percent or 320 watts among electric vehicle owners, who shift charging to nighttime. By lowering coincident demand, household-level peak reductions aggregate to lower local grid peaks and reduce costly grid investment.

JEL-codes: C23 D12 D91 L94 Q41 Q48 (search for similar items in EconPapers)
Pages: 86 pages
Date: 2025-06, Revised 2026-06
New Economics Papers: this item is included in nep-ene
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:rug:rugwps:25/1115

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