Time-of-Use Pricing vs Hopkinson Tariffs Redux An analysis of the choice of rate structures in a regulated electricity distribution company

Abstract

Recent proposals to restructure the electricity industry in North America may effect the disintegration of a vertically integrated company into several smaller entities, including distribution companies (Discos). We explore whether time-of-use (TOU) pricing or a Hopkinson tariff would be more suitable for a regulated Disco. Focusing on the economic efficiency of these alternative rate structures, we argue that a Hopkinson tariff with demand subscription is superior to TOU rates, as it can better handle the limited load diversity of local transmission and distribution (T&D) demands made upon the contemporary Disco, while finessing the problem of endogenous marginal costs of local T&D

Cite this paper

@inproceedings{Seeto2007TimeofUsePV, title={Time-of-Use Pricing vs Hopkinson Tariffs Redux An analysis of the choice of rate structures in a regulated electricity distribution company}, author={Dewey Seeto and Chi-Keung Woo and Ira Horowitz and Pedro Lobo and Louise Weiler}, year={2007} }