Economic analysis of reliability differentiated service (for electricity consumers)

@inproceedings{Rau1991EconomicAO,
  title={Economic analysis of reliability differentiated service (for electricity consumers)},
  author={Narayan S. Rau and Youssef Hegazy},
  year={1991}
}
Welfare gains and reserve reduction for giving electricity customers the choice of reliability of service are analyzed. The problem of specifying reliability indices to give proper signals to the consumer is outlined. The welfare maximization formulation of Ramsey has been extended to include reliability constraints. The results show uncertain benefits from reliability-based pricing. There appears to be no economic compulsion to warrant such pricing schemes. > 

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