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Real Time Pricing and the Real Live Firm.

DE2004826111

Publication Date	2004
Personal Author	Moezzi, M.; Goldman, C.; Sezgen, O.; Bharvirkar, R.; Hopper, N.
Page Count	20
Abstract	Energy economists have long argued the benefits of real time pricing (RTP) of electricity. Their basis for modeling customers response to short-term fluctuations in electricity prices are based on theories of rational firm behavior, where management strives to minimize operating costs and optimize profit, and labor, capital and energy are potential substitutes in the firm's production function. How well do private firms and public sector institutions operating conditions, knowledge structures, decision-making practices, and external relationships comport with these assumptions and how might this impact price response. We discuss these issues on the basis of interviews with 29 large (over 2 MW) industrial, commercial, and institutional customers in the Niagara Mohawk Power Corporation service territory that have faced day-ahead electricity market prices since 1998. We look at stories interviewees told about why and how they respond to RTP, why some customers report that they can't, and why even if they can, they don't.
Keywords	Electricity Economics Prices Operating cost Clients Decision making Real-time pricing
Source Agency	Technical Information Center Oak Ridge Tennessee
Corporate Authors	Lawrence Berkeley Lab., CA. Energy Analysis Program.; Department of Energy, Washington, DC.
Supplemental Notes	Sponsored by Department of Energy, Washington, DC.
Document Type	Technical Report
NTIS Issue Number	200508

Real Time Pricing and the Real Live Firm.

Real Time Pricing and the Real Live Firm.
DE2004826111

Publication Date	2004
Personal Author	Moezzi, M.; Goldman, C.; Sezgen, O.; Bharvirkar, R.; Hopper, N.
Page Count	20
Abstract	Energy economists have long argued the benefits of real time pricing (RTP) of electricity. Their basis for modeling customers response to short-term fluctuations in electricity prices are based on theories of rational firm behavior, where management strives to minimize operating costs and optimize profit, and labor, capital and energy are potential substitutes in the firm's production function. How well do private firms and public sector institutions operating conditions, knowledge structures, decision-making practices, and external relationships comport with these assumptions and how might this impact price response. We discuss these issues on the basis of interviews with 29 large (over 2 MW) industrial, commercial, and institutional customers in the Niagara Mohawk Power Corporation service territory that have faced day-ahead electricity market prices since 1998. We look at stories interviewees told about why and how they respond to RTP, why some customers report that they can't, and why even if they can, they don't.
Keywords	Electricity Economics Prices Operating cost Clients Decision making Real-time pricing
Source Agency	Technical Information Center Oak Ridge Tennessee
Corporate Authors	Lawrence Berkeley Lab., CA. Energy Analysis Program.; Department of Energy, Washington, DC.
Supplemental Notes	Sponsored by Department of Energy, Washington, DC.
Document Type	Technical Report
NTIS Issue Number	200508