Household Income, Electricity Use, and Rate-Structure Preferences

Explores the relationship between household income, present electricity use, and preferences for 3 proposed conservation-promoting electricity-rate structures, using data on 852 households collected as part of a larger project evaluating the effects of the Public Utility Regulatory Policies Act of 1978 in Oklahoma. The 3 structures involve time-of-day, seasonal, and interruptible rates. In considering the adoption of these structures, it is necessary to consider the possible losses in comfort vs the lowered costs of electricity. Previous research suggests that income levels and present comfort levels may impact willingness to adopt alternative rate structures. When present electricity use was used as a measure of the current comfort threshold, limited support was found for the suggestion that electricity use affects willingness to adopt alternative rate structures; stronger support was found for the hypothesis that income affects rate structure preferences. (27 ref)