Making the least active pay: a simulation of rewards and penalties under Demand Side Participation programs

The orthodox approach for incentivising Demand Side Participation (DSP) programs is that utility losses from capital, installation and planning costs should be recovered under financial incentive mechanisms which aim to ensure that utilities have the right incentives to implement DSP activities. The recent national smart metering roll-out in the UK implies that this approach needs to be reassessed since utilities will recover the capital costs associated with DSP technology through bills. This paper introduces a reward and penalty mechanism focusing on residential users. DSP planning costs are recovered through payments from those consumers who do not react to peak signals. Those consumers who do react are rewarded by paying lower bills. Because real-time incentives to residential consumers tend to fail due to the negligible amounts associated with net gains (and losses) or individual users, in the proposed mechanism the regulator determines benchmarks which are matched against responses to signals and caps the level of rewards/penalties to avoid market distortions. The paper presents an overview of existing financial incentive mechanisms for DSP; introduces the reward/penalty mechanism aimed at fostering DSP under the hypothesis of smart metering roll-out; considers the costs faced by utilities for DSP programs; assesses linear rate effects and value changes; introduces compensatory weights for those consumers who have physical or financial impediments; and shows findings based on simulation runs on three discrete levels of elasticity.

Barefoot in the Head

A co-edited book (Article Press, UCE, 2011), and book chapter written in response to the event: 'Barefoot in the Head', co-curated with Alun Rowlands and Mark Beasley at Bruce High Quality Foundation University, 225 West Broadway, as part of Performa 09 New York, 12 November 2009 Also including authored chapter: Russell, J. ‘A largely intolerable combination of two mainly unconnected texts: 1. Description of the Barefoot in the Head event, at BHQU, NY, 12/11/09; 2. Fictioning and the End.’ pp 68-85.

A largely intolerable combination of two mainly unconnected texts: 1. Description of the Barefoot in the Head event, at BHQU, NY, 12/11/09; 2. Fictioning and the End

An evaluation of the 'Barefoot in the Head' performance event, I co-curated with Alun Rowlands and Mark Beasley, at Bruce High Quality Foundation University, New York, as part of Performa 09 New York, 12 November 2009 - an examination of my own performance and the other performances occurring simultaneously at the event.