The price elasticity of electricity demand in the context of transition to green energy: Evidence from the Netherlands

Official URL: https://risc01.sabanciuniv.edu/record=b2749089_(Table of contents)

The main purpose of this thesis is to find the price elasticity of electricity demand in the green energy market by analyzing the new household type producing their electricity and the new production pattern of electricity producers. Moreover, investigating the channels underlying the efficiency of the day-ahead real-time pricing program is another aim of this paper. In this context, we used the data from the Dutch field experiment to examine residential consumers both with and without solar panels. According to empirical results, households react to the price increases by decreasing their electricity demand. Moreover, households with solar PV are also more price elastic compared to those without solar PV. Another outcome is that households become more price responsive when they check their smart meter more frequently. The last result of this paper is that households having environmental and saving awareness are more price responsive compared to other participants. Within this framework, increased household awareness and supplied information about electricity price and consumption is vital to implement a more efficient dayahead real-time pricing program for households. In this way, mismatch between electricity supply and demand can be decreased, and electricity producer does not need to increase their electricity generation capability to offset peak electricity demand. Thus, social welfare can be increased by reducing the cost of electricity.