The theory of maximum kW demand charges for electricity
File(s)
Journal
Energy Economics
Date Issued
1983
Author(s)
Abstract
The kilowatt (kW) demand charge characterizes most electricity price schedules for industrial customers, yet it has not been analysed thoroughly (compared with time-of-use rates). This article shows how such charges complicate interpretations of past estimates of the industrial demand for electricity. Using a utility maximization (cost minimization) model, we derive consistent demand curves, which are shown potentially to be subject to discontinuities.
Subjects