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Real-Time Pricing in the Swedish Electricity Market

Pihl, Hjalmar LU (2012) NEKH01 20112
Department of Economics
Abstract
An introduction of real-time prices of electricity, i.e. prices that correspond to the hourly spot market price, for residential consumers in Sweden has recently been suggested. Support for real-time pricing comes from governmental agencies as well as commercial interests, however without a good understanding of how a shift to real-time prices would affect prices and volumes in the market, and what welfare effects these changes would induce. This thesis addresses these issues by developing a model of the Swedish electricity market. The conclusion is that an introduction of real-time pricing would have a smoothing effect on prices and volumes, which in turn is likely to have positive welfare effects on producers and on the consumers that... (More)
An introduction of real-time prices of electricity, i.e. prices that correspond to the hourly spot market price, for residential consumers in Sweden has recently been suggested. Support for real-time pricing comes from governmental agencies as well as commercial interests, however without a good understanding of how a shift to real-time prices would affect prices and volumes in the market, and what welfare effects these changes would induce. This thesis addresses these issues by developing a model of the Swedish electricity market. The conclusion is that an introduction of real-time pricing would have a smoothing effect on prices and volumes, which in turn is likely to have positive welfare effects on producers and on the consumers that shift, but a negative effect on the larger consumers that already pay by the hour. The net welfare effect is likely to be positive. (Less)
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author
Pihl, Hjalmar LU
supervisor
organization
course
NEKH01 20112
year
type
M2 - Bachelor Degree
subject
keywords
Electricity, Real-Time Pricing, Sweden
language
English
id
2335215
date added to LUP
2012-02-13 13:17:54
date last changed
2012-02-13 13:17:54
@misc{2335215,
  abstract     = {An introduction of real-time prices of electricity, i.e. prices that correspond to the hourly spot market price, for residential consumers in Sweden has recently been suggested. Support for real-time pricing comes from governmental agencies as well as commercial interests, however without a good understanding of how a shift to real-time prices would affect prices and volumes in the market, and what welfare effects these changes would induce. This thesis addresses these issues by developing a model of the Swedish electricity market. The conclusion is that an introduction of real-time pricing would have a smoothing effect on prices and volumes, which in turn is likely to have positive welfare effects on producers and on the consumers that shift, but a negative effect on the larger consumers that already pay by the hour. The net welfare effect is likely to be positive.},
  author       = {Pihl, Hjalmar},
  keyword      = {Electricity,Real-Time Pricing,Sweden},
  language     = {eng},
  note         = {Student Paper},
  title        = {Real-Time Pricing in the Swedish Electricity Market},
  year         = {2012},
}