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Open Access Publications from the University of California

Heterogeneity in own-price residential customer demand elasticities for electricity under time-of-use rates: Evidence from a randomized-control trial in the United States


Regulators, policymakers, and stakeholders in several states have raised concerns about the price elasticity of residential customers’ electricity demand, especially as related to different customer subpopulations, management of critical end-uses, and enrollment approaches. This analysis sought to quantify the diversity of residential customer price elasticity in a time-of-use rate across these different dimensions using data generated from a utility pricing experiment. Customers were found to be more elastic during the peak period of critical peak days, who were predicted to own and use air conditioning, and who volunteered for time-of-use (TOU) rates (but those defaulted on were 25% as elastic).

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