A Win-Win Mechanism for Electricity Procurement by a Local Distribution Company

Chi-Keung WOO*, Ira Horowitz, Gabe Kwok, Shui Ki WAN, Weiwei WENG

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

A time-of-use rate option design allowing an LDC's customers to allocate their consumption to be billed at the fixed and daily-varying TOU rates offers a win-win mechanism for electricity procurement in the face of uncertain spot prices and hedging options. Even if all customers have the same risk preferences, the proposed mechanism is Pareto-superior to the tariffs and procurement strategies commonly used in North America.

Original languageEnglish
Pages (from-to)27-35
Number of pages9
JournalElectricity Journal
Volume26
Issue number1
DOIs
Publication statusPublished - Jan 2013

Scopus Subject Areas

  • Business and International Management
  • Energy (miscellaneous)
  • Management of Technology and Innovation

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