Abstract
We examine welfare eects of real-time pricing in electricity markets. Before stochastic energy demand is known, competitive retailers contract with nal consumers who exogenously do not have real-time meters. After demand is realized, two electricity generators compete in a uniform price auction to satisfy demand from retailers acting on behalf of subscribed customers and from consumers with real-time meters. Increasing the number of consumers on real-time pricing does not always increase welfare since risk-averse consumers dislike uncertain and high prices arising through market power. In the Bertrand
case, welfare is the same with all or no consumers on smart meters.
case, welfare is the same with all or no consumers on smart meters.
| Original language | English |
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| Publication date | 2011 |
| Number of pages | 38 |
| Publication status | Published - 2011 |
| Event | European Economic Association & Econometric Society : 2012 Parallel Meetings - University of Málaga, Málaga, Spain Duration: 27 Aug 2012 → 31 Aug 2012 http://www.eea-esem2012malaga.org/ |
Conference
| Conference | European Economic Association & Econometric Society |
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| Location | University of Málaga |
| Country/Territory | Spain |
| City | Málaga |
| Period | 27/08/2012 → 31/08/2012 |
| Internet address |