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Rethinking real-time electricity pricing

Harvard Dataverse (Africa Rice Center, Bioversity International, CCAFS, CIAT, IFPRI, IRRI and WorldFish)

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Title Rethinking real-time electricity pricing
 
Identifier https://doi.org/10.7910/DVN/9JWZVT
 
Creator Allcott, Hunt
 
Publisher Harvard Dataverse
 
Description Most US consumers are charged near-constant retail price for electricity, despite substantial hourly variation in the wholesale market price. This paper evaluates the first program to expose residential consumers to hourly real-time pricing (RTP). I find that enrolled households are statistically significantly price elastic and that consumers responded by conserving energy during peak hours, but remarkably did not increase average consumption during off-peak times. The program increased consumers surplus by $10 per household per year. While this is only one to two percent of electricity costs, it illustrates a potential additional benefit from investment in retail Smart Grid applications, including the advanced electricity meters required to observe a household's hourly consumption.
 
Subject Social Sciences
real time electricity pricing
energy demand
randomized field experiments
 
Contributor Rubio, Karl