Effective conservation incentives would send appropriate price signals to consumers. The more common approach, unfortunately, involves arbitrary standards that introduce market inefficiencies and...
Encore for Negawatts?
Congress renews PURPA’s call for conservation and load management, but the world has changed since the 1970s.
through bilateral trading contracts. (For the full explanation, see Comments of ISO New England, pp. 10-14.)
ISO-NE admits that its model is still a work-in-progress, but says it can use this method even to calculate the benefits of extending full nodal LMP pricing (“dynamic pricing”) to individual loads.
In fact, it estimates that over a five-year period, dynamic pricing for loads of 1 MW or greater (what is now enjoyed only by power producers on the supply side) could bring benefits of $340, at a cost of only $6.7 million a year, “at most.”