Real-time pricing and electric utility industry restructuring: Is the future ``out of control?``

Book · Sat Dec 31 04:00:00 EST 1994

OSTI ID:55560

Newcomb, J; Byrne, W

Increased price transparency in electric power markets will be the driving force for fundamental changes in the packaging of energy services for electricity customers. Rapid advances in communications and control capabilities may make it possible for electricity merchants to provide highly customized energy services that lower the cost of electricity service by allowing automated responses to real-time price signals. These new approaches imply less reliance on centralized control to match supply and demand under rapidly changing market conditions. Instead, they use price as a broadcast media to stimulate decentralized, distributed economic behaviors. Electricity suppliers will be driven by intense competitive pressures to minimize the average cost of their supply-demand portfolios through aggregation of diverse loads, energy storage, distributed generation, and dynamic load management agreements with customers. Real-time pricing programs currently offered by North American utilities barely scratch the surface of this new opportunity. Most offer minimal technical support services to customers; none provide flexible tools for financial risk management. The opportunity for providing these types of services to customers in the commercial sector is especially significant, since communications and control capabilities necessary to provide automated responses to real-time prices substantially overlap with those being developed to support remote monitoring of building equipment under full-service operations and maintenance agreements.

• OSTI ID: 55560
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
COMMERCIAL SECTOR
ELECTRIC POWER INDUSTRY
ELECTRIC UTILITIES
ENERGY MANAGEMENT SYSTEMS
INDUSTRIAL PLANTS
LOAD MANAGEMENT
ORGANIZING
RATE STRUCTURE
RESIDENTIAL SECTOR
SERVICE SECTOR
SUPPLY AND DEMAND
TIME-OF-USE PRICING