CUSTOMER-CLASS PRICE-DISCRIMINATION BY ELECTRIC UTILITIES

abstract

• Despite the concentration on peak-load pricing in public utility pricing theory, electric utilities in the United States have divided consumers by customer type (residential, industrial, commercial) rather than time of use (peak, off-peak) in determining prices. In this paper a theory of customer-class pricing is developed which emphasizes the impact of demand characteristics on optimal prices and the utility's pricing incentives under regulation. It is shown that customer-class demand patterns matter in determining socially optimal prices, and that the rate-of-return regulated utility has an incentive to distort prices to manipulate demand in predictable ways. 1987.

authors

• Eckel, Catherine

published proceedings

• JOURNAL OF ECONOMICS AND BUSINESS

author list (cited authors)

• ECKEL, C. C.

citation count

• 4

complete list of authors

• ECKEL, CC

publication date

• February 1987

publisher

• Elsevier  Publisher

published in

• Journal of Economics and Business  Journal

Digital Object Identifier (DOI)

• 10.1016/0148-6195(87)90003-8

start page

• 19

end page

• 33

volume

• 39

issue

• 1

URL

• http%3A%2F%2Fdx.doi.org%2F10.1016%2F0148-6195%2887%2990003-8