Time-varying retail electricity pricing is very popular with economists, but has little support among regulators and consumers. I propose an opt-in time-varying residential pricing plan that would be equitable to both customers who opt in and those who don’t. Low-income households would, on average, see almost no change in their bills under time-varying pricing, while low-consumption households would see their bills decline somewhat and high-consumption households would see their bills rise. Most importantly, I show that the opt-in approach is unlikely to increase the flat rate charged to other customers by more than a few percentage points.
Review of Industrial Organization – Springer Journals
Published: Nov 29, 2012
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