cleaner energy for sustainable future this special issue of the journal of cleaner production focuses on energy for sustainable future it is designed to mirror the increasing relevance of renewable energy sources and improved efficiency as crucial topics for practitioners in industry for governmental policy makers as well as for civic service providers researchers and educators the purpose of this special issue is to serve as a catalyst for dialogue the global warming related to co2 emissions coupled with steeply rising energy prices and the recent global financial institutional melt down are causing massive societal concerns and give rise to increasing demand for ways to improve societal and individual energy efficiency and for ways to shift increasingly to alternative low or non carbon based energy systems until recently industrial energy efficiency improvements have focused on improvements on efficiency rather than on the integration of renewable sources the aim of this special issue is the identification of policies to support the development and implementation of technologies and management approaches we can employ to make the transition to more sustainable societies the collection of papers in this special issue provide a foundation for students researchers scholars practitioners and policy makers interested in making sustainable development more than a metaphor the papers include focus upon ways for a improving industrial process to achieve improvements in energy efficiency b minimising waste disposals and reducing their impact through better management c reducing co2 emissions by making progress toward lower carbon renewable energy based systems d improving production of biofuels and hydrogen production systems facilitated by employing cleaner production and novel lca tools e improving integration of advanced materials and energy efficient equipment in different industrial sectors current and future developments in national and world economies are closely connected to sustainable efficient and safe usage of raw materials and upon energy based on cleaner production concepts and approaches that are ecologically and economically appropriate for the short and for the long term future of society these challenges have received considerable attention in the media and scientific journals over the last several years the idea of developing a specialised conference focussed upon them was put forward on various occasions focus upon them became reality on the 5th and 6th may 2008 in the historic castle of veszprem hungary the current premises of the hungarian academy of science which hosted the workshop the workshop was a stimulating event and an overwhelming success with nearly 100 contributors from africa north america asia and europe representing 28 countries after a comprehensive selection and thorough reviewing procedure 11 papers were selected for this special issue

modelling sustainable home ownership demographics or economics according to recent official projections 4 4 million new households will be formed in england between 1991 and 2016 these estimates are based on a detailed analysis of demographic trends but take no account of the effect of potential changes in economic conditions particularly on the owner occupancy rate in this paper we propose a new approach to modelling sustainable owner occupancy which places less emphasis on demographics but considers in more detail the role of market mechanisms through changes in house prices and rates of new construction

time of day pricing in the u s electric power industry at the turn of the century around the turn of the century a debate occurred within the infant u s electric power industry on the issue of electricity rate structures we describe those discussions and consider the views of some of the economists who first addressed the issue although they were ultimately unsuccessful there were sophisticated advocates of time of day rates among the first engineers utility executives and economists to study electricity rates

the case against intellectual property according to a common argument the presence of strong intellectualproperty rights spurs innovation which leads to higher economic growthand increasing benefits for all the argument seems coherent theestablishment of secure property rights is a fundamental pillar of a wellfunctioning market economy no economic agent exercises productiveeffort without the certainty of controlling its fruits what is true forphysical effort must be true for the intellectual one if strong propertyrights provide good incentives for the production of potatoes they mustalso provide good incentives for the production of ideas why then do we argue a case against intellectual property are wearguing that while stealing potatoes is bad stealing ideas is good weare not economic efficiency and common sense argue that ideasshould be protected and available for sale just like any other commodity but intellectual property has come to mean not only the right to ownand sell ideas but also the right to regulate their use this creates asocially inefficient monopoly and what is commonly called intellectualproperty might be better called intellectual monopoly when you buy apotato you can eat it throw it away plant it or make it into a sculpture current law allows producers of a cds and books to take this freedomaway from you when you buy a potato you can use the idea of a potatoembodied in it to make better potatoes or to invent french fries currentlaw allows producers of computer software or medical drugs to take thisfreedom away from you it is against this distorted extension ofintellectual property rights that we argue it is a long jump from the assertion that inventors deserve the fruits oftheir efforts to the conclusion that current patent and copyrightprotection are the best way of providing such reward statements such

residential peak electricity demand response highlights of some behavioural issues electricity demand response refers to consumer actions that change the utility load profile in a way that reduces costs or improves grid security the focus of demand response has mainly been on the commercial and big industrial sectors because of the large demand reduction that they can offer to the utility grid operators utilities are showing increasing interest in residential demand response rdr rdr can be treated as an energy resource which can be assessed and commercially developed however there are still some issues that remain to be addressed for rdr to be successful these include price unresponsiveness of some residential consumers equity issues and high cost of the metering infrastructure the aim of this paper is to investigate and present some of the challenges in achieving effective voluntary demand reduction based on a review of residential demand response literature as well as the general residential energy use behaviour literature the authors propose the use of a hybrid engineering approach using social psychology and economic behaviour models to overcome these challenges and realize the benefits of supply security and cost management

optimal pricing in electrical networks over space and time an electrical system is modelled with a transmission network customers central generators and independent generators the system is subject to stochastic failures and stochastic demand parameters optimal spot prices are derived for the system they vary stochastically with space and time and depend on electrical load flow patterns the price difference between two locations or two voltage levels and the wheeling charge between them will change magnitude and sometimes sign over time as a function of events throughout the network current spatial pricing methods are significantly different from the spot price based methods derived here

the impact of land use planning and tax subsidies on the supply and price of housing in britain this article presents new empirical estimates of the impact of two types of policy intervention tax subsidies and land use planning on the housing market in britain the estimates are derived from a set of models representing the demand and supply sides of the market for the new private housebuilding which include an explicit land supply element the models are fitted to cross sectional data at the inter urban local authority level and then employed in medium period simulations of alternative policies modelling at this level enables estimates to be made of the extent of variation between local markets in the elasticity of supply and also in the impacts of policy measures including the capitalisation of tax subsidies

public utility pricing under risk the case of self rationing comment and extension this paper reviews a previously offered model of electricity load management containing uncertainties this analysis allows individual customer demand to fluctuate within a billing period also it allows diversity or imperfect correlation among customer demands the behavioral effects are examined for a fuse that allows utilities and customers to incur costs or ration the loads under excess demand charges the behavioral implication is that the demand price is effective at each instant of the billing period the fuse analogy suggests that demand and energy prices be kept separate and that behavior is best understood as a two stage procedure

consumer demand and the life cycle allocation of household expenditures the purpose of this paper is to estimate the parameters of household preferences that determine the allocation of goods within the period and over the life cycle using micro data in doing so the authors are able to identify important effects of demographics labor market status and other household characteristics on the intertemporal allocation of expenditure they test the validity of the life cycle model using excess sensitivity tests and find that controlling for demographics and labor market status variables can largely explain the excess sensitivity of consumption to anticipated changes in income

electricity demand by time of use an application of the household aids model in this study we estimated the price and expenditure elasticities of peak and off peak electricity consumption using a micro data set on 220 households living in 19 swiss cities the household version of the almost ideal demand system model aids was used as a framework to incorporate household characteristics the aids model was expanded by specifying the intercept as a linear function of household characteristics variables results indicate that demand for peak and off peak electricity is elastic and that cross price effects are positive as well as the elasticity of substitution therefore peak and off peak electricity are substitutes in the hicks allen sense

ten propositions in uk housing macroeconomics an overview of the 1980s and early 1990s during the last ten years macroeconomists have increasingly come to realise that there are important interactions between housing and the wider economy in some cases this realisation has come too late to avoid the severe oscillations in the economy that have characterised the period since the mid 1980s this paper uses a macroeconometric model specifically designed to capture the interactions in order to reflect on the experience of the 1980s and early 1990s and to draw theoretical empirical and policy conclusions in terms of ten propositions

a new contribution to the paris metro pricing proposal using the concept of the paris metro pricing we will show that when the distribution of the capacity between sub networks leads to any loss of technical effectiveness and when a traditional condition on the hazard rate is checked it is always optimal for the monopolist to subdivide his main network in as many sub networks as there are different types of net surfers

the bias in price elasticity estimates under homothetic separability implications for analysis of peak load electricity pricing this article demonstrates that the assumption of a homothetically separable utility function places a priori restrictions on the parameters of the demand system if these restrictions are unwarranted an open question if they are not explicitly tested they will lead to biased price elasticity estimates in particular we show that the uncompensated own price elasticities must be smaller than the negative of the expenditure shares that is the price elasticity of peak electricity demand must be less than the negative of the share of expenditure devoted to peak electricity this finding is probably not new to economists familiar with consumer demand analysis nevertheless many recent studies of consumer demand for electricity under time of day rates explicitly impose this restriction the resulting price elasticity estimates are usually quite large in absolute value 5 to 8 but they are the product of restrictive a priori assumptions as well as information embodied in the sample data the results of

real time pricing when some consumers resist in saving electricity 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

demand generation and price in the norwegian market for electric power we analyse the simultaneous determination of supply demand and price in the competitive norwegian electricity market deregulated in 1991 this market is pretty mature and it offers numerous data required carrying out an interesting study stochastic and seasonal water inflow water storage possibilities and demand variations make this market interesting both from a theoretical and empirical view we establish a small supply demand model of the norwegian electricity market the model is estimated using weekly data from 1994 to 1995 data for 1996 are used for post sample examination of the model unexpected inflow snow and temperature conditions explain a large part of the variation in the electricity generation demand and price within and post sample simulation of the estimated model reproduce demand and price patterns considerably well

the economics of ideas and the ideas of economists william r johnson is professor of economics university of virginia this paper was delivered as his presidential address on november 19 2005 in washington dc at the annual meeting of the southern economic association

reducing greenhouse gas emissions by inducing energy conservation and distributed generation from elimination of electric utility customer charges this paper quantifies the increased green house gas emissions and negative effect on energy conservation or efficiency penalty due to electric rate structures that employ an unavoidable customer charge first the extent of customer charges was determined from a nationwide survey of u s electric tariffs to eliminate the customer charge nationally while maintaining a fixed sum for electric companies for a given amount of electricity an increase of 7 12 in the residential electrical rate was found to be necessary if enacted this increase in the electric rate would result in a 6 4 reduction in overall electricity consumption conserving 73 billion kw hrs eliminating 44 3 million metric tons of carbon dioxide and saving the entire u s residential sector over 8 billion per year as shown here these reductions would come from increased avoidable costs thus leveraging an increased rate of return on investments in energy efficiency energy conservation behavior distributed energy generation and fuel choices finally limitations of this study and analysis are discussed and conclusions are drawn for proposed energy policy changes

the price elasticity of electricity demand in south australia abstract in this paper the price elasticity of electricity demand representing the sensitivity of customer demand to the price of electricity has been estimated for south australia we first undertake a review of the scholarly literature regarding electricity price elasticity for different regions and systems then we perform an empirical evaluation of the historic south australian price elasticity focussing on the relationship between price and demand quantiles at each half hour of the day this work attempts to determine whether there is any variation in price sensitivity with the time of day or quantile and to estimate the form of any relationships that might exist in south australia

a field study using an adaptive in house pricing model for commercial and industrial customers in korea abstract demand response programs provide customers with economic incentives for load reductions at times of high market prices and system reliability constraints one type of demand response programs price based program induces customers to respond to changes in product rates however some large scale customers find it difficult to change their electricity consumption patterns even with rate changes because their electricity demands are commercial and industrial this study proposes an adaptive in house pricing model for large scale customers particularly those with multiple business facilities for self regulating price based program the adaptive in house pricing model charges higher rates to customers with lower load factors by employing a peak to off peak usage ratio in order to reduce usage at times of high prices at each facility this study analyzes the daily electricity consumption patterns of large scale customers through a field trial of the proposed pricing model at a telecom company with 447 offices and worksites for one month the results show that the pricing model corresponds to average reductions of 3 54 28 69 during peak demand times for four different types of workplaces however reductions in electricity consumption during off peak periods did not show a significant difference the results of this study prove that this proposed pricing model can be successfully applied to large scale operations

tax subsidies to owner occupied housing an asset market approach inflation reduces the effective cost of homeownership and raises the tax subsidy to owner occupation this paper presents an asset market model of the housing market and estimates how changes in the expected inflation rate affect the real price of houses and the equilibrium size of the housing capital stock simulation results suggest that the accelerating inflation of the 1970s which substantially reduced homeowners user costs could have accounted for as much as a 30 percent increase in real house prices persistent high inflation rates could lead ultimately to a sizable increase in the stock of owner occupied housing

the hourly income elasticity of electricity using a detailed data set on appliance level electricity consumption at the hourly level we provide the first estimates of hourly and end use specific income elasticities for electricity such est

is it more effective to bring time of use pricing into increasing block tariffs evidence from evaluation of residential electricity price policy in anhui province abstract reform of energy prices in china has stepped into a crucial stage it has become a controversial issue after the reform of increasing block tariffs ibts for household electricity followed by a time of use tou pricing policy using eles model this paper estimates the price elasticity of residential electricity demand based on perceived price and price elasticity a power structure model demand response for nonlinear electricity price is proposed taking anhui province as a case this paper analyzes the attainment situation of such policy objectives as electricity saving consumer welfare equity improvement and peak shaving with the introduction of tou pricing into ibts for household electricity the results show that ibts helps reduce electricity consumption by 0 74 0 93 with minor energy effect ibts may lead to a maximum 1 57cny increase of electricity expense per household per month which is acceptable for residents it also may reduce cross subsidy to some extent after introducing tou pricing the efficiency of peak shaving is only 2 25 2 78 and the load decrement at peak periods is far lower than the increase at valley periods while the effect of electricity conservation and cross subsidy reduction have been alleviated in other words peak valley price is not only difficult to achieve its own objective effectively but also prohibits the effect of ibts based on the above conclusions some policy recommendations are provided to improve the price reform of residential electricity natural gas and other public resources in various regions of china and foreign regions with similar electricity market

photovoltaic energy systems with battery storage for residential areas an economic analysis abstract the global energy market is characterized by the strong growth of photovoltaic pv energy this renewable source contributes to sustainable development and is a strategic player in the electricity market the profitability of pv systems is determined by incentive tariffs in developing markets and by the share of self consumption in developed markets this paper aims to evaluate i the profitability of pv systems in the residential sector without subsidies and ii the profitability of energy storage in a mature market italy in this way it is possible to define the economic results of integrated pv battery systems and the indicator used is the net present value furthermore a sensitivity analysis is conducted on the critical variables the mathematical model proposed in this paper defines the break even point of the increase of self consumption at which residential pv battery systems become economically viable in a mature market energy storage systems are useful only when the relationship between supply and demand permits them to induce a significant increase of energy self consumption

ten new propositions in uk housing macroeconomics an overview of the first years of the century in the mid 1990s meen set out a series of propositions concerning the relationship between housing and the macro economy during the 1980s and early 1990s this paper provides 10 further propositio

the response of industrial customers to electric rates based upon dynamic marginal costs recent advances in technology and in the theory of electric utility operations and planning have led to an in creased interest in rate and service options that are differen tiated over short time intervals the purpose of this paper is to describe the results from an analysis of a real time pricing experiment recently conducted at niagara mohawk power corporation the objective of the experiment is to measure the response of large industrial customers to dynamic fully time differentiated marginal cost based electricity rates over a broad range of industries because of its design features including the establishment of an experimental control group the niagara mohawk study provides a rare opportunity to study large user response to real time pricing including inter hour price elasticities

a nested ces approach to capital energy substitution abstract this paper uses the nested constant elasticity of substitution ces production function to estimate elasticities of substitution between capital labour energy and materials over the 1971 1976 period around the initial energy crisis elasticities are estimated for each of the two digit sic industries within us manufacturing using more disaggregate four digit sic data the nested ces function makes it possible to distinguish between engineering and economic elasticities of substitution capital and energy are estimated to be slight engineering substitutes and economic complements labour energy and materials are estimated economic substitutes

the cost of electric power interruptions in the industrial sector estimates derived from interruptible service programs the electric power industry has become increasingly interested in the value customers place upon service reliability with the demand for reliability couched in terms of outage or shortage costs the survey based method of eliciting these costs dominates the literature this paper explores and demonstrates a method for estimating outage and shortage costs based upon behavioral data a discrete choice model is developed for estimating shortage costs using observed decisions of industrial customers regarding participation in interruptible service programs the resulting shortage cost estimates of 4 per kwh unserved for a one hour interruption are consistent with previous survey based estimates

modelling time of day substitution using the second moments of demand time of day tod rates are a commonly used method for peak load pricing of many services such services as electricity communications transportation shared computer facilities and computer networks i e the internet either use or will use some form of tod pricing however tod rates do not ensure a movement towards economic efficiency unless the patterns of tod substitution are known the model presented here provedes a method for estimating tod substitution without the need for rate experiments that have proven to be both costly and limited by sample selection bias problems this model employs the estimated second moment of demand to estimate a matrix of relative own and cross price elasticities and it can estimate elasticities even when there is no apparent tod price variation the low level of computations required for the estimates allows the application of a bootstrap procedure to estimate the covariance matrix of the elasticities two applications of this model are presented a case of a

the neoclassical model of consumer demand with identically priced commodities an application to time of use electricity pricing hick s theorem permits aggregation of commodities when their relative prices are fixed but contrary to a widely expressed view it does not require that they be aggregated even where commodities have identical prices all of their income elasticities and many of their price elasticities can be identified through econometric estimation our empirical illustration uses the generalized leontief indirect utility function with data from the wisconsin residential electricity pricing experiment we model the demand for six commodities although there are only two unique prices

real time pricing of electricity for residential customers econometric analysis of an experiment under real time pricing a network operator sets the price level for a period according to a predefined scheme which depends on the state of demand and costs and announces this price shortly before the period begins the french state owned electric utility experimented with a six rate real time tariff which divides the year into three types of days and each day into two periods the number of days of each type is known in advance to the consumer but the type of any particular day is announced only at the end of the preceding day in order to evaluate the responsiveness of customers to this pricing option we estimate the frisch demand functions for daily electricity consumption derived from a simple dynamic model based on an additively separable intertemporal utility function as the marginal utility of expenditure which enters the frisch demands follows a known stochastic process the econometric model has a state space representation we can then apply the kalman filter to compute the log likelihood function associated with each consumer s time series of electricity consumption the main result of the analysis is that the real time tariff improves the welfare of a majority of consumers participating in the experiment

planning and housing supply in two speed britain modelling local market outcomes summary economic research on uk housing markets has only recently got to grips with measuring and modelling the impact of planning and other public interventions although their importance has long been recognised in theory the interurban panel dataset utilised in this study does represent a step forward by permitting more robust econometric estimation and by incorporating a wider more balanced range of determinant factors a coherent set of relationships governing the key market outcomes house prices new building migration and vacancies can be established the modelling framework is used to explore differences in behavioural responses between markets in high and low demand states simulations are used to track the impact on market outcomes of different policy strategies applied in different types of locality supply measures needed to achieve national targets for house price growth reduction are assessed measures acting on both demand side and supply side variables in areas of high and low demand are compared these suggest that output is more sensitive than price to policies and that quite strong concerted policies would be needed to impact significantly on the major market imbalances currently seen

promotion of market access for renewable energy in the nordic power markets this study investigates how renewable targets for the nordic power market might be achieved at the lowest costs the instruments investigated are fixed feed in tariff economically sound premium based feed in tariff and shadow prices for co2 emissions we utilize a real time price based simulation model in the analysis we show that even with strong assumptions regarding the emission permit price the targeted level of wind power is not reached without feed in tariffs emission trading produces the lowest total emissions but with the highest total costs from the studied instruments the most cost efficient way to reach the targets for wind energy market shares is the premium based feed in tariff this tariff is also the most cost efficient way to reduce co2 emissions

potential capability estimation for real time electricity demand response of sustainable manufacturing systems using markov decision process abstract electricity demand response has been considered as a critical methodology to realize the strategy of sustainable development for manufacturing enterprises by effectively reducing the increasing electricity demand and greenhouse gas emissions most existing studies about the electricity demand response implementation focus on either the supply side management e g policy making price setting or the customer side applications for the end users in residential and commercial building sectors as for the industrial sector only a few papers utilizing the long term scheduling methodology to reduce the electricity consumption during peak periods are available little work has been implemented on the decision making for the real time electricity demand response in industrial manufacturing systems considering system throughput constraint in this paper an analytical model is established to identify the optimal energy control actions and estimate the potential capacity of power demand reduction of typical manufacturing systems during the period of demand response event without compromising system production markov decision process is used to model the complex interaction between the adopted demand control actions and the system state evolutions a numerical case study on a section of an automotive assembly line is used to illustrate the effectiveness of the proposed approach

a disaggregated nonhomothetic modeling of responsiveness to residential time of use electricity rates in addition to quantifying the load impacts of time differentiated rates on aggregate peak off peak groupings a very finely disaggregated rotterdam demand system is described and estimated for explaining changes in detailed features of customers electricity load patterns this linear first difference formulation allows for nonhomotheticity permits an examination of load impacts on critical hours of the week and makes use of both control and time of use data moreover the proposed specification is parameter parsimonious an illustrative use of this model is portrayed through recent empirical evidence from a residential experiment of a northern winter peaking utility in ontario canada copyright 1992 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

does responsive pricing smooth demand shocks using data from a unique pricing experiment we investigate vickrey s conjecture that responsive pricing can be used to smooth both predictable and unpredictable demand shocks our evidence shows that increasing the responsiveness of price to demand conditions reduces the magnitude of deviations in capacity utilization rates from a pre determined target level a 10 increase in price variability leads to a decrease in the variability of capacity utilization rates between 2 and 6 we discuss implications for the use of demand side incentives to deal with congestible resources

the importance of transnational impacts of climate change in a power market abstract we contribute to the discussion on transnational impacts of climate change by analysing the potential cross border impacts climate change driven changes in the hydropower potential we analyse this in the context of the nordic countries where norway and sweden are likely to gain hydropower potential and finland is likely to experience transnational impacts we use an economic simulation model and a dynamic optimization model to study the impact of climate change to the production mix the price of electricity consumption of electricity and emissions from electricity production we show that climate change might reduce prices through increased renewables supply which decreases the profitability of power production the changes in the inflow profile affect the hydropower profiles over the hydrological year such that the reduced inflow peak in the spring shifts the hydropower production from spring to autumn and winter in addition the larger inflow increases the share of hydropower in production mix over the year the emissions per consumed energy unit is going to be decreased because of the decreasing share of the thermal production in the system however increased hydropower production reduces prices which in turn increases the quantity demanded this rebound effect somewhat dampens the emission reduction

industrial response to electricity real time prices short run and long run i introduction with the emergence of competition in the electric industry wholesale prices are proving highly volatile during the summers of 1998 and 1999 prices in the midwest soared to 7000 or more per megawatt hour compared to a typical summer price of 30 50 one factor contributing to this volatility is that relatively few retail customers pay real time prices rtps that vary with changing supply and demand conditions as a result retail use is not deterred by the spikes in wholesale price exacerbating wholesale volatility without providing an opportunity for retail response there will be pressure on policy makers to curb wholesale volatility with such measures as the price caps approved by the federal energy regulatory commission in new york and california as a result of high electricity prices during 2000 increasingly electric utilities now offer their largest industrial and commercial customers hourly prices that vary with changes in real time supply and demand 1 the purpose of this article is to estimate and evaluate the short run and long run factors that influence customer price response to rtps to date there have been relatively few studies of response to rtp rates and those have been largely limited to short run estimates this study advances the research by evaluating how customer response to rtp changes with experience on the rates in addition there is consideration of the sensitivity of price response to changes in the levels of both prices and temperatures finally there is an examination of customer characteristics particularly on site generation that provide flexibility in responding to price changes the data include 110 industrial customers served by duke power a division of duke energy corporation some of the participating customers have been on rtp rates for as long as six years utilities need information on short run response to know the magnitude of demand relief that price responsiveness may provide when capacity is tight as well as to determine unit commitment and spinning reserve they need long run response to plan additions to capacity knowledge of individual customer response can help utilities target those customers who are most likely to opt for rtp responsive customers may include those with interruptible batch production processes and with on site generation in addition to utilities policy makers need to know price response to determine the role of rtp in achieving efficient electric resource use 2 this study adopts the modeling and estimation procedures set forth by herriges et al 1993 and king and shatrawka 1994 both employed a nested constant elasticity of substitution ces functional form herriges et al 1993 estimated response to an rtp rate offered by the niagara mohawk company at the time there were only 15 customers with usable data one strength of the study was the availability of a control group on non rtp rates king and shatrawka 1994 employed a much larger sample of 150 customers served by the midlands electric company great britain but did not have a control group both studies provided shortrun estimates only patrick and wolak 1997 also used midlands data to estimate demand elasticities from a generalized mcfadden functional form though their findings appear to be consistent with the other studies it is difficult to compare their results directly given the differing functional form 3 their study used several years of data and did include temperature but provided only short run estimates additionally there were no consistent findings regarding temperature their study proposed the analysis of customer learning for future work 4 o sheasy 1997 and gupta and danielson 1998 have raised the possibility that price response depends on the level of price o sheasy 1997 suggests a demand curve with vertical segments over certain price ranges

price variation antagonism and firm pricing policies abstract pricing schemes that vary prices in response to demand shocks may antagonize consumers and reduce demand at the same time consumers may take advantage of the opportunities offered by price changes overall the net impact of varying price on demand is ambiguous we investigate this issue empirically exploiting a unique dataset from a firm that has experimented with different pricing schemes each scheme is characterized by how much prices respond to fluctuations in demand and generates different amounts of price variability we find that greater variability in prices does not lead to diminished demand we discuss the implications of our findings in terms of the consumer antagonism hypothesis

demand responses of korean commercial and industrial businesses to critical peak pricing of electricity abstract dynamic pricing of electricity is receiving growing attention as a key enabler of the smart grid and a solution for promoting grid resilience to increasing penetration of renewable sources despite various dynamic pricing programs are contemplated and actively implemented by utilities in many developed economies corporate decision makers are not aware of the extent to which their businesses can adapt to the programs and its associated risks and opportunities this study investigates the demand response of commercial and industrial businesses to the korean critical peak pricing pilot which was implemented in the winter of 2013 the demand responses of 802 businesses covering 34 commercial and industrial categories are evaluated and characterized by constructing their individual baseline loads the results resoundingly confirm substantial differences in demand response across and within the segments with the magnitude of response closely correlated with the firms expenditure shares of electricity it is thus suggested that conventional business classification is not sufficient enough to characterize firms demand response to dynamic pricing plans calling for firm level data based approaches to consumer segmentation and electricity services this study also identifies two important types of response behavior to which due attention has not been paid shortterm learning effect that is the demand responsiveness increasing with cpp event experiences and seemingly inefficient behavior of preparatory and recovering reductions in off peak hours neighboring critical peak hours

effects of the optimal port queuing pricing on arrival decisions for container ships when arriving at a busy port a container ship usually need to queue in anchorage waiting for a berth if the port establishes a toll scheme the ship may rationally adjust sailing speed and time to save the cost otherwise she has to pay for berthing on time consequently container ships arrival times at the port will be dispersed and the queuing situation can be decreased in this article an optimal step toll scheme by cost equilibrium approach is designed and all values of equilibrium queuing cost and operating cost under the scheme are obtained according to equilibrium results in this study we show container ships that pay the toll to berth a queuing port are those altered their original arrival times at the port before the toll established in addition those ships arrival time adjusting decisions from the nontoll to the optimal step toll cases can be well investigated before tolling a queuing port

copying and indirect appropriability photocopying of journals creators and owners of intellectual properties are alarmed by the growth of technologies that ease the tasks of copying these properties this paper however shows that the unauthorized copying of intellectual properties need not be harmful and actually may be beneficial the empirical impact of photocopying on publishers of journals is examined in an attempt to discover if publishers can indirectly appropriate revenues from users who are not original purchasers the evidence indicates that publishers can indirectly appropriate revenues from users who do not directly purchase journals and that photocopying has not harmed journal publishers 18 references 1 table

interaction between economic and financial development this paper presents a model of financial and economic development which assumes the consumption of real resources by the financial sector financial development occurs endogenously as the economy reaches a critical threshold of economic development compared to financial autarky financial intermediaries allocate savings net of their costs of operation to more productive investments whenever the technology financed by intermediaries is more capital intensive than that operated in financial autarky the growth effect of financial development is ambiguous as a result financial development may be unsustainable however when financial development is sustainable the credit market becomes more competitive and more efficient over time and this could eventually contribute to economic growth nonetheless given monopolistic competition in the financial sector the level of entry into the credit market is generally inefficient for instance with diminishing returns to specialisation entrants might be too few at the early stages of economic development and too many later on

the impact of heat waves on electricity spot markets abstract thermoelectric power plants depend on cooling water drawn from water bodies low river run off and or high water temperatures limit a plant s production capacity this problem may intensify with climate change our study quantifies the impact of forced capacity reductions on market prices production costs consumer and producer surplus as well as emissions by means of a bottom up power generation system model first we simulate the german electricity spot market during the heat wave of 2006 then we conduct a sensitivity study that accounts for future climatic and technological conditions we find an average price increase of 11 during the heat wave 2006 which is even more pronounced during times of peak demand production costs accumulate to an additional but moderate 16 m due to the price increase producers gain from the heat wave whereas consumers disproportionately bear the costs carbon emissions in the german electricity sector increase during the heat wave the price and cost effects are more pronounced and increase significantly if assumptions on heat sensitive demand hydropower capacity net exports and capacity reductions are tightened these are potential additional effects of climate change hence if mitigation fails or is postponed globally the impacts on the current energy system are very likely to rise increases in feed in from renewable resources and demand side management can counter the effects to a considerable degree countries with a shift toward a renewable energy supply can be expected to be much less susceptible to cooling water scarcity than those with a high share of nuclear and coal fired power plants

real time pricing in the nordic power markets abstract in this paper we study the potential effects of real time pricing rtp of electricity on the need for long run capacities in the nordic power markets a characteristic of the nordic power market is the large variety of production technologies of which hydro and nuclear power are capacity constrained we analyze the impact of rtp on the need for total peak and midmerit capacities total demand prices peak demand hours and economic welfare we have also studied whether the results of rtp are sensitive to the simultaneous implementation of tradable emission permits we find that rtp diminishes the need for total capacity even with inelastic demand our results show that even with modest assumptions related to rtp participation the annual midmerit and peaker capacity efficiency savings amount to 97 million euros which are around 6 of their total annual investment costs the price of the peak demand hour clearly diminishes as the share of the rtp customers increases or demand becomes more price elastic we compare rtp and tradable emission permits as two separate instruments in reaching energy use efficiencies and show how these two instruments must be seen as complementary and not as substitutable instruments we show how rtp and tradable emission permits have a positive correlation in promoting market access of renewable energy sources we find that welfare effects of the implementation of rtp are positive

the long run effects of a time of use demand charge modifications in demand due to time of use tou pricing have potential to improve the efficiency of electric power supply with long lead times for plant construction utility planners need long run estimates of response to tou rates existing evidence is primarily drawn from short run tou experiments we provide estimates of long run response to a nonexperimental residential tou rate offered by duke power the rate contains a demand charge applied to the maximum rate of energy consumption during the peak period we find that customer response increases over time in a manner that enhances the ability of tou rates to reduce system peak

short and long run time of use price elasticities in swiss residential electricity demand abstract this paper presents an empirical analysis on the residential demand for electricity by time of day this analysis has been performed using aggregate data at the city level for 22 swiss cities for the period 2000 2006 for this purpose we estimated two log log demand equations for peak and off peak electricity consumption using static and dynamic partial adjustment approaches these demand functions were estimated using several econometric approaches for panel data for example lsdv and re for static models and lsdv and corrected lsdv estimators for dynamic models the attempt of this empirical analysis has been to highlight some of the characteristics of the swiss residential electricity demand the estimated short run own price elasticities are lower than 1 whereas in the long run these values are higher than 1 the estimated short run and long run cross price elasticities are positive this result shows that peak and off peak electricity are substitutes in this context time differentiated prices should provide an economic incentive to customers so that they can modify consumption patterns by reducing peak demand and shifting electricity consumption from peak to off peak periods

on the role of maximum demand charges in the presence of distributed generation resources abstract we examine the role that maximum demand charges mdcs might play in ensuring the financial viability of utilities in the presence of ever expanding distributed generation dg of electricity we find that optimally designed mdcs generally secure gains for consumers that do not undertake dg and often secure gains for consumers that undertake dg however the welfare gains tend to be modest in plausible settings furthermore time of use pricing often secures larger welfare gains than do mdcs

simple rule for management of thermal loads with real time prices abstract the integration of renewable energies and therefore the generation of a clean and sustainable energy is a current demand by society the use of real time pricing offers advantages for integrating renewable resources into the electrical grid this is because users enhance the flexibility of their own energy demand thanks to planning loads with accumulation capacity the aim of the present work is to equip users to manage their energy demands with simple planning systems for this a simple rule is proposed to help a greater number of users to gain the capacity to manage their demand the new rule based on a geometric progression of real time pricing of energy and intrinsic characteristics of the load provides valuable information for the user to decide whether or not to accumulate energy in the load this rule provides good results by the simulation of a simple thermal load

demographic change and the housing market evidence from a comparison of scotland and england this paper examines the impact of demographic change on the housing market more specifically a difference in differences methodology is used to explore the effect of population decline and population ageing on house prices in scotland and england wales the analysis suggests that population decline and population ageing put downward pressure on prices therefore the long run trend of rising real house prices can not be assumed to continue into the future particularly in scotland

the economics of copyright fair use in a networked world the recent success of file sharing technologies such as napster has highlighted the economic question of whether copying increases or decreases the market value of copyrighted works contrary to michele boldrin and david k levine 2002 we show that napster type services are likely to reduce copyright value this economic question of the effect of copying on copyright value largely coincides with the legal question of whether copying is fair use the primary legal determinant of fair use or use that does not require authorization by the copyright holder is whether the use adversely affects the present or future economic value of the copyrighted work 1 however given this legal standard it is unclear why copyright holders ever disagree with the court regarding fair use our analysis shows that there is no inherent conflict between the court and copyrightholders with regard to particular uses but why there may be a conflict with regard to a technology that has both fair and infringing uses

residential electricity pricing in china the context of price based demand response abstract as a secondary energy electricity is an important channel between original energy and energy consumers electricity price is a critical factor for the interests of all involvers in the electric power market it also plays an important role for the sustainable development of energy and environment smart grid is a new conception proposed in recent years to improve the intelligent level and increase the efficiency of electric power system operation smart grid combines and integrates information technology communication technology and intelligent control technology with tradition power system to achieve the many objectives of smart grid demand response dr as an effective technique of demand side management dsm refers to the changes in electricity consumption behavior of users in response to the dynamic price or incentive rewards price based demand response pbdr is one of the two major dr programs in this paper we first introduce the pricing theories in economics the pricing of electricity and the development of electricity pricing in china then we present a detailed discussion on the pbdr strategies in the dsm of smart grid also the research status of pbdr is reviewed finally it gives a summary of the whole paper in the last section

the response of small and medium size business customers to time of use tou electricity rates in israel this paper reports on the methodology data and results of the israeli time of use tou electricity pricing experiment in the industrial commercial sector we concentrate on the estimation of the demand functions for electricity under tou and the net welfare gains which result from applying tou rates to small and medium size business customers in israel this experiment which was preceded by a 15 month load research study to allow an optimal sample design was concluded in june 1992 the analysis yielded four major conclusions 1 the estimated gains of small and medium size customers in israel from tou rates are sufficient to justify investment in tou metering technology 2 there have been small but noticeable shifts of electricity from the peak to the mid peak if relevant and to the off peak periods during all seasons of the year and particularly during the winter 3 the structure and number of labour shifts during the day and weather are important factors in determining the response of business customers to the tou rates 4 price elasticities vary substantially over the seasons and across sic groups they do not vary with customer size

optimizing the production scheduling of a single machine to minimize total energy consumption costs abstract the rising cost of energy is one of the important factors associated with increased production costs at manufacturing facilities which encourages decision makers to tackle this problem in different manners one important step in this trend is to reduce the energy consumption costs of production systems considering variable energy prices during one day this paper proposes a mathematical model to minimize energy consumption costs for single machine production scheduling during production processes by making decisions at machine level to determine the launch times for job processing idle time when the machine must be shut down turning on time and turning off time this model enables the operations manager to implement the least expensive production scheduling during a production shift to obtain near optimal solutions genetic algorithm technology has been utilized furthermore to determine whether the heuristic solution provides the minimum cost and the best possible schedule for minimizing energy costs an analytical solution has also been run to generate the optimal solution next a comparison between the analytical solution and heuristic solutions is presented for larger problems the heuristic solution is preferable the results indicate that significant reductions in energy costs can be achieved by avoiding high energy price periods this minimization process also has a positive environmental effect by reducing energy consumption during peak periods which increases the possibility of reducing co 2 emissions from power generator sites

hourly based greenhouse gas emissions of electricity cases demonstrating possibilities for households and companies to decrease their emissions abstract greenhouse gas emissions from electricity production are a crucial part of the environmental impact assessments of any kind of product service or consumption usually average annual emissions are used but lately there has been increased interest in the daily based and hourly based emission coefficients for electricity in such markets where the technology mix in the production process includes technologies with different emission factors there is potential for large variation in hourly based emission factors and consequently this offers potential for decreasing the emissions by real time based demand management however in real life the timing of electricity use in households and companies has restrictions in this paper we show illustrative household and company cases with realistic shifts in the timing of electricity use we determine hourly based emission factors and give examples of how emissions may be decreased in households and companies by changing usage patterns and consequently the timing of electricity use with the total amount of electricity consumed remaining unchanged the examples show decreases of emissions in the range 3 8 due to optimised timing indicating that there is important potential for managing hourly based demand loads and the resulting emissions even with realistic assumptions of the timing of consumption