Dynamic pricing of electricity in retail markets

Chefi Triki, Antonio Violi

Research output: Contribution to journalArticle

50 Citations (Scopus)

Abstract

This paper aims at defining a dynamic and flexible tariff structure for a distribution company that protects the retail consumers against the excessive fluctuations of the wholesales market prices. We propose a two-stage pricing scheme that sets in a first-stage a time-of-use tariff that is corrected later by a dynamic component once the real-time demand has been observed. A personalized tariff scheme may be offered by a distribution company to each dynamic customer by allowing him to choose the appropriate robustness level expressed in terms of variability between the first and the second-stage decisions. The arising limited recourse model has been tested on realistic test problems, by using a slight modification of a recently proposed interior point solution framework.

Original languageEnglish
Pages (from-to)21-36
Number of pages16
Journal4OR
Volume7
Issue number1
DOIs
Publication statusPublished - Mar 2009

Fingerprint

Dynamic Pricing
Electricity
Costs
Flexible Structure
Flexible structures
Interior Point
Test Problems
Pricing
Industry
Customers
Choose
Fluctuations
Robustness
Real-time
Market
Tariffs
Dynamic pricing
Retail market
Model

Keywords

  • Electricity market
  • Pricing methods
  • Stochastic Programming

ASJC Scopus subject areas

  • Management Information Systems
  • Computational Theory and Mathematics
  • Theoretical Computer Science

Cite this

Dynamic pricing of electricity in retail markets. / Triki, Chefi; Violi, Antonio.

In: 4OR, Vol. 7, No. 1, 03.2009, p. 21-36.

Research output: Contribution to journalArticle

Triki, Chefi ; Violi, Antonio. / Dynamic pricing of electricity in retail markets. In: 4OR. 2009 ; Vol. 7, No. 1. pp. 21-36.
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