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Residential End-use Electricity Demand: Implications for Real Time Pricing in Sweden

Mattias Vesterberg and Chandra Kiran B. Krishnamurthy

Year: 2016
Volume: Volume 37
Number: Number 4
DOI: 10.5547/01956574.37.4.mves
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Abstract:
Using a unique and highly detailed data set on energy consumption at the appliance-level for 200 Swedish households, seemingly unrelated regression (SUR)based end-use specific load curves are estimated. The estimated load curves are then used to explore possible restrictions on load shifting (e.g. the office hours schedule) as well as the cost implications of different load shift patterns. The cost implications of shifting load from "expensive" to "cheap" hours, using the Nord pool spot prices as a proxy for a dynamic price, are computed to be very small; roughly 2-4% reduction in total daily cost from shifting load up to five hours ahead, indicating small incentives for households (and retailers) to adopt dynamic pricing of electricity. Keywords: Direct Metering, Residential Electricity Demand, Real time electricity pricing



Understanding Hourly Electricity Demand: Implications for Load, Welfare and Emissions

Amin Karimu, Chandra Kiran B.Krishnamurthy, and Mattias Vesterberg

Year: 2022
Volume: Volume 43
Number: Number 1
DOI: 10.5547/01956574.43.1.akar
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Abstract:
In this study, using hourly data from a representative sample of Swedish households on standard tariffs, we investigate the welfare and emission implications of moving to a mandatory dynamic pricing scheme. We allow demand during different hours of a day to affect utility differently, and account for the derived nature of electricity demand by explicitly accounting for the services (end-use demands) that drive hourly electricity demand. We use the flexible Exact Affine Stone Index (EASI) demand system, which accommodates both observed and unobserved heterogeneity in preferences, to understand changes in load consequent to hourly retail pricing. Our findings suggest that, following hourly retail pricing, changes in load patterns across hours are relatively small: total load changes by less than one percent. There are correspondingly small reductions in welfare and carbon emissions, of less than 0.2 percent and 0.47 percent, respectively. Overall, in the context of a decentralized, competitive retail electricity market-setting, our results suggest that the benefits to ensuring that the retail price of electricity reflects the hourly marginal cost is small, at least in the short run.





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