Srl | Item |
1 |
ID:
115186
|
|
|
Publication |
2012.
|
Summary/Abstract |
The three-tier inclining block tariff ("IBT") issued by the Chinese government in 2010 is focusing attention of energy economists, among whom Lin and Jiang (2012. Designation and influence of household increasing block electricity tariffs in China. Energy Policy 42, 164-173) who assert that the issued tariff is unsuited to meet the social and environmental objectives it was designed for. These authors offer an alternative four-tiered IBT, the performance of which they show by evaluating its welfare and income distribution effects taking the current uniform tariff as reference. To measure the surplus loss to a representative household in a given block the authors use the trapezoid approach. But, because of the limited data on demand, they calculate the household's response by using a constant point estimate of the own-price elasticity of electricity demand. In this note I show there is an incompatibility between these two modeling assumptions. Combining them is causing an upward bias in the surplus loss, which is of significance given the large price change associated with the IBT. I then offer a correction to this bias.
|
|
|
|
|
|
|
|
|
|
2 |
ID:
125471
|
|
|
Publication |
2013.
|
Summary/Abstract |
Successful real-time electricity pricing depends firstly upon consumers' willingness to subscribe to such terms and, secondly, on their ability to curb consumption levels. The present paper addresses both issues by considering consumers differentiated by their electricity saving costs, half of whom resist saving electricity. We demonstrate that when consumers are free to adopt real-time prices, producers prefer charging inefficient prices and, in so doing, discriminate against that portion of the consumer population which faces no saving costs. We also find that efficient marginal cost pricing is feasible, but is incompatible with mass adoption of real-time prices.
|
|
|
|
|
|
|
|
|
|