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Pricing for retail electricity

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Journal of Revenue and Pricing Management Aims and scope

Abstract

A big unanswered question in the power industry is how the future demand for energy will be met. As the rate of energy usage increases at an average of 2.3 per cent per year, demand management is one means of dealing with the increasing demands for energy. Pricing that varies for critical peak demand periods and discounted the rest of the time is one means of dealing with the increasing demands for energy. The next frontier for the revenue management and pricing practice will be helping the retail energy providers develop more efficient rate designs or dynamic pricing programs.

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Notes

  1. The average growth rate, or compound annual growth rate, over a period from 2007 to 2035.

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Acknowledgements

Several graphs presented in this article are based on data publicly available for download from the US Department of Energy (DOE) Energy Information Administration (EIA) web site. I thank the following individuals: John Juliano and Michael Valocchi (IBM) for their reviews and suggestions, and Fabienne Guildhary (IBM) for coordinating their reviews; Emily Horn (IBM) for her assistance in helping me navigate the publication approval process and proofing; Christer Johnson and Adam Gersting (IBM) for their support and encouragement; Jenny Palmer of The Brattle Group for providing me high quality images of some of Dr Ahmad Faraqui's peak demand reduction graphs; Linda Doman at US DOE EIA for clarification on the growth of net electricity generation (see Figure 2); and my wife Kim Quillinan for her support, numerous reviews, suggestions and proofing.

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  1. IBM Global Business Services, Orlando, Florida, USA

    John D Quillinan

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  1. John D Quillinan
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Correspondence to John D Quillinan.

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bserves as the North American Global Practice Lead for Revenue Management and Pricing within the Business Analytics and Optimization practice of IBM's Global Business Services. His experience includes a diverse portfolio of industries, which includes airlines, hospitality, media and entertainment, and retail, where he implemented revenue management and price optimization models. He now brings a strong focus on price optimization to energy and utilities. He is a certified Revenue Management leader (HSMAI CRME), and Past Chair of the INFORMS Revenue Management and Pricing Section.

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Quillinan, J. Pricing for retail electricity. J Revenue Pricing Manag 10, 545–555 (2011). https://doi.org/10.1057/rpm.2011.22

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  • DOI: https://doi.org/10.1057/rpm.2011.22

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