Real-time pricing: DSM at its best

Journal Article · · Electricity Journal; (USA)

DOI:https://doi.org/10.1016/1040-6190(90)90092-N· OSTI ID:5947821

Chapman, B ^[1]; Tramutola, T

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1. Laurits R. Christensen Associates, Madison, WI (USA)

Most electric utilities now have in place or intend to offer a wide variety of demand-side management (DSM) programs aimed at the full range of utility customer groups and designed to produce many different kinds of customer responses. However, given the ambiguity in individual program response and the possibility for interactive effects among programs a portfolio of DSM plans may be difficult to manage toward specific objectives. In response to this dilemma, Niagara Mohawk Power Corporation (NMPC) created the Hourly Integrated Pricing Program (HIPP) to determine experimentally whether real-time pricing can provide the appropriate customer response at precisely the time it is required. By basing electric service pricing on short-run marginal cost, NMPC wanted to see if it could achieve efficient restructuring of usage patterns under equitable revenue reconciliation arrangements. This article presents and reviews early results from the HIPP experiment. The authors believe it presents compelling evidence that marginal cost-based prices achieve efficient DSM usage pattern modifications and that such pricing programs are acceptable to customers. 2 figs., 5 tabs.

• OSTI ID: 5947821
• Journal Information: Electricity Journal; (USA), Journal Name: Electricity Journal; (USA) Vol. 3:7; ISSN ELEJE; ISSN 1040-6190
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
292000 -- Energy Planning & Policy-- Supply
Demand & Forecasting
296000* -- Energy Planning & Policy-- Electric Power
DEMAND FACTORS
ELECTRIC POWER
ELECTRIC UTILITIES
INDUSTRY
MANAGEMENT
POWER
POWER DEMAND
PUBLIC RELATIONS
PUBLIC UTILITIES
RATE STRUCTURE