Hogan, William W | Search NASA

DOE OSTI2010

Demand response compensation, net Benefits and cost allocation: comments

FERC's Supplemental Notice of Public Rulemaking addresses the question of proper compensation for demand response in organized wholesale electricity markets. Assuming that the Commission would proceed with the proposal ''to require tariff provisions allowing demand response resources to participate in wholesale energy markets by reducing consumption of electricity from expected levels in response to price signals, to pay those demand response resources, in all hours, the market price of energy for such reductions,'' the Commission posed questions about applying a net benefits test and rules for cost allocation. This article summarizes critical points and poses implications for the issues of net benefit tests and cost allocation. (author)

29 ENERGY PLANNING, POLICY, AND ECONOMY↗

DOE OSTI2010

Fairness and dynamic pricing: comments

In ''The Ethics of Dynamic Pricing,'' Ahmad Faruqui lays out a case for improved efficiency in using dynamic prices for retail electricity tariffs and addresses various issues about the distributional effects of alternative pricing mechanisms. The principal contrast is between flat or nearly constant energy prices and time-varying prices that reflect more closely the marginal costs of energy and capacity. The related issues of fairness criteria, contracts, risk allocation, cost allocation, means testing, real-time pricing, and ethical policies of electricity market design also must be considered. (author)

29 ENERGY PLANNING, POLICY, AND ECONOMY↗