Electricity Pricing and Load Management
Foreign Experience and California Opportunities
Examines the peak-load pricing policies and load-management experience of selected foreign utilities and the opportunities for applying their methods in California. The study's major objectives are (1) to review factors determining the costs of supplying electricity; (2) to assemble evidence of the extent to which consumers' loads are responsive to tariff provisions and the extent to which load-management measures achieve load shifting; and (3) to extrapolate observed European response to peak-load tariffs to the industrial sector of California. Using a sample of 175 California customers in 18 industrial groupings, the authors calculate that under peak-load tariffs, backed by economic incentives for off-peak consumption, energy use would be reduced by 54-76 million kwh per month during a four-hour peak period, or by 33 to 46 percent of the present statewide peak-hour industrial demand. This would result in more efficient fuel use and a savings of as much as $1.3 million per month.