American Economic Review · 2012 · 277 citations · 11 references
Natural ResourcesEconomicsElectrical EngineeringEnergy EconomicsEnergy PolicyPricing TheoryDemand ResponseDemand-side ManagementDynamic PricingElectricity Load ManagementElectricity MarketsEnergy PricingDemand Response EconomicsDemand Response PricingElectricity Price FormationElectricity PricingElectricity Pricing MechanismsElectricity Pricing RegulationPrice-based Demand ResponseTime-varying Pricing
As both a regulator and an academic, Fred Kahn argued that end-use electricity consumers should face prices that reflect the time-varying marginal costs of generating electricity. This has been very slow to happen in the US, even in light of recent technological advances that have lowered costs and improved functionality for meters and automated demand response technologies. We describe these recent developments and discuss the remaining barriers to the proliferation of time-varying electricity pricing.
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