A Consumer Dissatisfaction Model Linking Dynamic Pricing With Shifted Product-Use in Residential Electricity Markets

2020 ◽  
Author(s):  
Samuel Dunbar ◽  
Scott Ferguson
Keyword(s):  
Electricity Markets ◽  
Dynamic Pricing ◽  
Financial Incentives ◽  
Energy Demand ◽  
Consumer Preferences ◽  
Population Level ◽  
System Level ◽  
Renewable Energy Resources ◽  
Product Use ◽  
Consumer Dissatisfaction

Abstract Demand Response (DR) is the implementation of a specific strategy or set of strategies, with the goal of altering consumer energy demand, such that some system level objectives are improved. These strategies typically include dynamic pricing, direct load control, policy implementation, or other financial incentives. DR will become a crucial tool for managing growing global energy demand in conjunction with higher penetration rates of intermittent renewable energy resources. Effective implementation of a DR strategy requires a realistic understanding of how consumers will respond to that strategy and how they will be affected by it. Here, a product-based decision model for residential consumers, that links consumer decisions directly to product-use, is revisited and adapted from a continuous time formulation to discrete time. The relationship between financial incentives, consumer preferences, and demand flexibility at the population level is then quantified. The model is used for exploring the tradeoffs between typical objectives for a dynamic pricing residential DR program and evaluating the characteristics of well-performing pricing solutions.

The Impact of Consumer Preference Distributions on Dynamic Electricity Pricing for Residential Demand Response

2019 ◽  
Author(s):  
Samuel Dunbar ◽  
Scott Ferguson
Keyword(s):  
Demand Response ◽  
Dynamic Pricing ◽  
Consumer Preferences ◽  
Consumer Preference ◽  
Population Level ◽  
Economic Incentives ◽  
System Level ◽  
Renewable Energy Resources ◽  
Product Use ◽  
The Impact

Abstract Demand Response (DR) is the adjustment of consumer electricity demand through the deployment of one or more strategies, e.g. direct load control, policy implementation, dynamic pricing, or other economic incentives. Widespread implementation of DR is a promising solution for addressing energy challenges such as the integration of intermittent renewable energy resources, reducing capacity cost, and improving grid reliability. Understanding residential consumer preferences for shifting product usage and how these preferences are distributed amongst a population are key to predicting the effectiveness of different DR strategies. In addition, there is a need for a better understanding of how different DR programs, system level objectives, and preference distributions will impact different segments of consumers within a population. Specifically, the impacts on their product use behavior and electricity bill. To address this challenge, a product based approach to modeling consumer decisions about altering their electricity consumption is proposed, which links consumer value to their products, instead of directly to the amount of electricity they consume. This model is then used to demonstrate how population level preference distributions for altering product use impact system level objectives.

scholarly journals Energy Demand Management and Social Norms

Energies ◽  
2020 ◽  
Vol 13 (15) ◽  
pp. 3779
Author(s):  
Bernadeta Gołębiowska ◽  
Anna Bartczak ◽  
Mikołaj Czajkowski
Keyword(s):  
Social Norms ◽  
Financial Incentives ◽  
Energy Demand ◽  
Consumer Preferences ◽  
Demand Management ◽  
Electricity Consumption ◽  
External Control ◽  
Revealed Preferences ◽  
Personal Norms ◽  
The Impact

The main objective of our study was investigating the impact of norms and financial motivation on the disutility of energy management for Polish households. We analyzed consumer preferences and willingness to accept demand-side management (DSM) programs. Choice experiment was applied for electricity contracts including external control of electricity consumption. Ajzen’s theory of planned behavior provided the theoretical framework of the study, which tested hypotheses about the impact of social norms on consumer choices of electricity contracts. We show that people with higher descriptive social norms about electricity consumption are less sensitive to the level of compensation and more responsive to the number of blackouts. People willing to sign a contract for financial reasons were less sensitive to the external control of electricity consumption and less inclined toward the status quo option. Injunctive social norms and personal norms had a non-significant impact on consumer decisions. We conclude that financial incentives can reduce the effect of the norms. Social and personal norms seem to be more important when we analyze the revealed preferences. European countries face significant challenges related to changes in energy policy. This study contributes to understanding the decisions of households and provides insights into the implementation of DSM.

scholarly journals A Multiarmed Bandit Based Incentive Mechanism for a Subset Selection of Customers for Demand Response in Smart Grids

2020 ◽  
Vol 34 (02) ◽  
pp. 2046-2053 ◽  
Author(s):  
Jain Shweta ◽  
Gujar Sujit
Keyword(s):  
Demand Response ◽  
Electricity Markets ◽  
Private Information ◽  
Dynamic Pricing ◽  
Smart Grids ◽  
Renewable Energy Resources ◽  
Incentive Compatible ◽  
Pricing System ◽  
The Stability ◽  
Selection Of

Demand response is a crucial tool to maintain the stability of the smart grids. With the upcoming research trends in the area of electricity markets, it has become a possibility to design a dynamic pricing system, and consumers are made aware of what they are going to pay. Though the dynamic pricing system (pricing based on the total demand a distributor company is facing) seems to be one possible solution, the current dynamic pricing approaches are either too complex for a consumer to understand or are too naive leading to inefficiencies in the system (either consumer side or distributor side). Due to these limitations, the recent literature is focusing on the approach to provide incentives to the consumers to reduce the electricity, especially in peak hours. For each round, the goal is to select a subset of consumers to whom the distributor should offer incentives so as to minimize the loss which comprises of cost of buying the electricity from the market, uncertainties at consumer end, and cost incurred to the consumers to reduce the electricity which is a private information to the consumers. Due to the uncertainties in the loss function (arising from renewable energy resources as well as consumption needs), traditional auction theory-based incentives face manipulation challenges. Towards this, we propose a novel combinatorial multi-armed bandit (MAB) algorithm, which we refer to as \namemab\ to learn the uncertainties along with an auction to elicit true costs incurred by the consumers. We prove that our mechanism is regret optimal and is incentive compatible. We further demonstrate efficacy of our algorithms via simulations.

scholarly journals Exploring a Culture of Health in the Auto Industry

2021 ◽  
Vol 13 (7) ◽  
pp. 3924
Author(s):  
Wendy M. Purcell ◽  
Brian S. Feldman ◽  
Molly Finn ◽  
John D. Spengler
Keyword(s):  
Auto Industry ◽  
Population Level ◽  
Well Being ◽  
System Level ◽  
Senior Executives ◽  
Negative Impacts ◽  
Health Model ◽  
Business In Society ◽  
Corporate Actions ◽  
Societal Expectations

The Culture of Health framework includes four pillars of societal health and well-being influenced by business, namely: consumers; employees and workers in the supply chain; the community, and the environment. The Auto industry was an ideal crucible in which to explore the interface of public health with business given the confluence of the different domains in this sector. The substantial benefits of mobility, especially for the under-resourced, sit alongside negative impacts from emissions, accidents, products and services. Through interviews with 65 senior executives from seven major automakers, corporate actions reflecting health as a strategic agenda were mapped to the Culture of Health model. While most of the companies did not use the language of health explicitly in their strategy, key examples were present across all four pillars. Given the future of mobility relies on the interface of human experience with technology, it is a population-level challenge demanding system-level changes. Ostensibly, a framework for sustainability, the Culture of Health model could help the Auto industry navigate the disruption caused by the global megatrends and changing societal expectations of business in society and transition successfully to a new mobility economy.

scholarly journals Who could be One Health Activist at the community level?: A case for India

2021 ◽  
Vol 19 (1) ◽  
Author(s):  
Sandul Yasobant ◽  
Walter Bruchhausen ◽  
Deepak Saxena ◽  
Farjana Zakir Memon ◽  
Timo Falkenberg
Keyword(s):  
Health System ◽  
Work Experience ◽  
Financial Incentives ◽  
One Health ◽  
Health Workers ◽  
Structured Interview ◽  
Communicable Diseases ◽  
Community Level ◽  
System Level

Abstract Background Community health workers (CHWs) are the mainstay of the public health system, serving for decades in low-resource countries. Their multi-dimensional work in various health care services, including the prevention of communicable diseases and health promotion of non-communicable diseases, makes CHWs, the frontline workers in their respective communities in India. As India is heading towards the development of One Health (OH), this study attempted to provide an insight into potential OH activists (OHA) at the community level. Thus, this case study in one of India’s western cities, Ahmedabad, targeted identifying OHA by exploring the feasibility and the motivation of CHWs in a local setting. Methods This case study explores two major CHWs, i.e., female (Accredited Social Health Activists/ASHA) health workers (FHWs) and male (multipurpose) health workers (MHWs), on their experience and motivation for becoming an OHA. The data were collected between September 2018 and August 2019 through a mixed design, i.e., quantitative data (cross-sectional structured questionnaire) followed by qualitative data (focus group discussion with a semi-structured interview guide). Results The motivation of the CHWs for liaisoning as OHA was found to be low; however, the FHWs have a higher mean motivation score [40 (36–43)] as compared to MHWs [37 (35–40)] out of a maximum score of 92. Although most CHWs have received zoonoses training or contributed to zoonoses prevention campaigns, their awareness level was found to be different among male and female health workers. Comparing the female and male health workers to act as OHA, higher motivational score, multidisciplinary collaborative work experience, and way for incentive generation documented among the female health workers. Conclusion ASHAs were willing to accept the additional new liaison role of OHAs if measures like financial incentives and improved recognition are provided. Although this study documented various systemic factors at the individual, community, and health system level, which might, directly and indirectly, impact the acceptance level to act as OHA, they need to be accounted for in the policy regime.

scholarly journals Economic Feasibility of Energy Supply by Small Modular Nuclear Reactors on Small Islands: Case Studies of Jeju, Tasmania and Tenerife

Energies ◽  
2018 ◽  
Vol 11 (10) ◽  
pp. 2587 ◽  
Author(s):  
Sanghyun Hong ◽  
Barry Brook
Keyword(s):  
Energy Demand ◽  
Nuclear Reactors ◽  
High Energy ◽  
Economic Feasibility ◽  
System Level ◽  
Small Island ◽  
Small Islands ◽  
Hydroelectric Power ◽  
Generation Cost ◽  
Electricity Grids

Small modular nuclear reactors (SMRs) offer the promise of providing carbon-free electricity and heat to small islands or isolated electricity grids. However, the economic feasibility of SMRs is highly system-dependent and has not been studied in this context. We selected three case-study islands for such an evaluation: Jeju, Tasmania and Tenerife based on their system complexity. We generated 100,000 electricity-mix cases stochastically for each island and examined the system-level generation-cost changes by incrementing the average generation cost of SMRs from USD$60 to 200 MWh−1. SMRs were found to be economically viable when average generation cost was <$100 MWh−1 for Jeju and <$140 MWh−1 for Tenerife. For Tasmania the situation was complex; hydroelectric power is an established competitor, but SMRs might be complementary in a future “battery of the nation” scenario where most of the island’s hydro capacity was exported to meet peak power demand on the mainland grid. The higher average generation cost of SMRs makes it difficult for them to compete economically with a fossil fuel/renewable mix in many contexts. However, we have demonstrated that SMRs can be an economically viable carbon-free option for a small island with a limited land area and high energy demand.

scholarly journals Can We Regulate Our Way to Energy Efficiency? Product Standards as Climate Policy

2018 ◽  
Author(s):  
Noah M. Sachs
Keyword(s):  
Energy Efficiency ◽  
Financial Incentives ◽  
Information Disclosure ◽  
Energy Demand ◽  
Energy Savings ◽  
The United States ◽  
Vital Role ◽  
Political Support ◽  
Carbon Taxes ◽  
Regulatory Approach

In this Article, I demonstrate that the regulatory strategy for energy efficiency is working. Although information disclosure, financial incentives, and other softer alternatives to regulation play a vital role in reducing energy demand, these should be viewed as complements to efficiency regulation, rather than replacements. The regulatory approach has led to substantial cost and energy savings in the past, it has enjoyed bipartisan political support, and it targets products and behaviors that are difficult to address through other policy tools. Given the politics of climate change in the United States, which make federal carbon taxes or a cap-and-trade system infeasible, the regulatory option should be expanded, not abandoned.

scholarly journals Energy Storage as a System Resource

2020 ◽  
Author(s):  
Ramon Leon ◽  
Maria Camila Ochoa ◽  
Alejandro Gutierrez
Keyword(s):  
Energy Storage ◽  
Electricity Markets ◽  
Large Scale ◽  
Business Models ◽  
Power Grids ◽  
Renewable Energy Resources ◽  
Grid Resource ◽  
Electric Industry ◽  
Sustainable Business ◽  
System Resource

The origins of the electric industry can be traced back to the invention of the battery. However, Energy Storage Systems (ESS) have never been considered as a part of the electricity supply chain. Even though there has been an increase of government mandated storage investments in power grids, market driven investments are still lacking sustainable business models. Now, with the possibility that cost reductions of the technology make it viable for widespread utilization, multiple efforts have been devoted by the academia and industry to design its incorporation into electricity markets. A large majority of the proposals have been devoted to develop mechanisms for their incorporation in ancillary services markets or for arbitrage, considering storage as another market player, both still with little success in providing sustainable benefits to energy consumers and investors alike. In this paper, we demonstrate that Large Scale Energy Storage excels when incorporated as a service provider in electricity markets. Our proposal considers ESS as a grid resource, available to the ISO to achieve the optimal mix of resources in the day ahead dispatch. We demonstrate that in the Colombian system, a large ESS used in this manner may achieve high benefit-cost ratios. The results also indicate that current market designs need to evolve in order to take better advantage of energy storage and renewable energy resources.

scholarly journals The Risk of Residential Peak Electricity Demand: A Comparison of Five European Countries

2017 ◽  
Author(s):  
Jacopo Torriti
Keyword(s):  
Time Use ◽  
Electricity Markets ◽  
Electricity Market ◽  
Dynamic Pricing ◽  
Risk Model ◽  
European Countries ◽  
Peak Demand ◽  
Time Use Survey ◽  
Control Dynamic ◽  
Different Levels

The creation of a Europe-wide electricity market combined with the increased intermittency of supply from renewable sources calls for an investigation into the risk of aggregate peak demand. This paper makes use of a risk model to assess differences in time-use data from residential end-users in five different European electricity markets. Drawing on the Multinational Time-Use Survey database, it assesses risk in relation to the probability of electrical appliance use within households for five European countries. Findings highlight in which countries and for which activities the risk of aggregate peak demand is higher and link smart home solutions (automated load control, dynamic pricing and smart appliances) to different levels of peak demand risk.

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