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Commercial and Industrial Demand Response Under Mandatory Time-of-Use Electricity Pricing
RFF Academic Seminar

Presenter
David Rapson

Abstract

This paper evaluates the extent to which a mandatory time-of-use (TOU) pricing program changes the energy use of commercial and industrial electricity customers. We use firm-level panel data on monthly electricity expenditure, usage and peak load that correspond to one of the first large-scale field deployments of a mandatory TOU regime. The analysis yields four major findings: (1) there is little evidence of change in aggregate usage or load resulting from TOU pricing in this setting; (2) on average, after adjusting for a rate-class discount implicit in the price schedule, bills are unchanged and increases in bill volatility are minimal; and (3) there is significant heterogeneity of response to TOU across industries. Together, these imply that the TOU regime did not generate the intended response by firms, calling into question the efficacy of the policy at the observed price differential. Our results also suggest that concerns about mandatory TOU pricing, namely high bill levels and increased bill volatility, have been overstated.

Date

Thursday, October 6, 2011
12 - 1:30 p.m.

Lunch will be provided

Location
7th Floor Conference Center
1616 P St. NW
Washington, D.C. 20036

All seminars will be in the 7th Floor Conference Room at RFF, 1616 P Street NW. Attendance is open, but involves pre-registration no later than two days prior to the event. For questions and to register to an event, please contact Charlotte Pineda at Pineda@rff.org (tel. 202-328-5021). Updates to our academic seminars schedule will be posted at www.rff.org/academicseminarseries.

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