Bachelorarbeit Economics

Titel: Welfare Impact of Real-Time Pricing on Retail Electricity Markets
Fertigstellung: Juli 2023

This bachelor thesis presents an evaluation of the welfare effects of introducing real-time pricing (RTP) on retail electricity markets. The literature review focuses on microeconomic partial equilibrium analyses. This work shows that the welfare benefits of switching to RTP are larger if the price elasticity of demand is high, variance of the spot price on the wholesale market is large, correlation between demand and the spot price is large, elasticity of supply is low, market power exists within the market and if behavioral costs can be reduced by implementing automatic technology. Nevertheless, an implementation of real time pricing is not a pareto improvement. It incurs large distributional consequences. Which consumer group loses depends on their consumption patterns, which vary greatly from region to region.

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