HOUSEHOLD CHOICE OF NEW ELECTRICITY SERVICE PLANS AND THE ROLE OF INFORMATION FEEDBACK

摘要

Equipping electricity consumers with smart meters not only reduces the costs of on-premise meter reading incurred to utility companies but also enables new electricity service plans (ESPs) often based on the dynamic pricing (DP) of electricity (Neenan & Hemphill, 2008). A number of earlier pilot studies have also demonstrated that ESPs have potential to bring a sizeable reduction in peak electricity demand and energy conservation for electricity customers and that the extent of demand response can be influenced by providing smart meter-based information feedback on the price and usage of electricity (Allcott, 2011; Faruqui et al. 2012, 2013; Jessoe & Rapson, 2014). Understanding the response of electricity customers to DPs has never been more important as it is now due to challenges faced by utility companies and regulators. Utility companies, on the one hand, are required to design and introduce DPs that serve their customers while at the same time addressing increased short-term financial risks. The risks orginate from uncertainties about the customers’ choice of and response to ESPs (Gellings & Yeager, 2004) and the influence of the increasing deployment of distributed generation sources. On the other hand, utility regulators are urged to oversee the delivery of ESPs to ensure that the market transition serves economic efficiency and distributional equity and system-level reliability due to increasing grid connection of renewable sources. It is imperative for the regulators to assess whether or not DPs, which require non-trivial investments in metering infrastructures as well as auxiliary information technologies, would pay off in terms of decade-long savings in capacity and generation costs. Therefore, the behavioural response of electricity customers to DPs in general and the response with technology-based information feedbacks in particular should be topics of serious academic inquiry. Despite such importance, we found that surprisingly little of existing literature examined consumers’ preference for the combination of DPs and information feedback, characterized by policy-relevant and readily observable consumer characteristics. In this research, we attempt to fill this gap by solving three research questions: (1) How consumers value the attributes of dynamic pricing plan (2) What is the role of information feedback for consumers in choosing new ESPs (3) How households’ socio-economic and electricity consumption-related information characterize their preference for new ESPs To address these questions, we developed a discrete choice experiment (DCE) of 13 questions for 1,504 Korean households, and estimated their preferences using multinomial logit and willingness-to-pay (WTP) space model (Train and Weeks, 2005).