Capital costs and capital requirements. [Rate design and effects on power demand]
Perhaps the most critical development during the past decade for the electric utility industry is the change from being an industry in which the cost per unit of output falls as output rises to one in which cost per unit of output increases with output, says this author. Hence the importance of the question: what can we do to control the rate of growth in demand for electricity. He suggests that there are numerous ways in which rate design (price rationing) and load management (nonprice rationing) may be used to control growth in demand. But he questions the wisdom and feasibility of raising the average price of electricity toward the marginal cost of producing it. ''Rate design, including peak-load pricing, appears to be a more efficient instrument for controlling the rate of growth in demand.''
- Research Organization:
- Univ. of Toronto
- OSTI ID:
- 5284960
- Journal Information:
- Public Util. Fortn.; (United States), Journal Name: Public Util. Fortn.; (United States) Vol. 100:13; ISSN PUFNA
- Country of Publication:
- United States
- Language:
- English
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