Total Cost Electricity Pricing: A Market Solution for Increasingly Rigorous Environmental Standards

This technology-neutral marginal cost pricing approach can integrate the private and social costs of electricity generation. The pricing methodology borrows from the adders and value-based feed-in tariff literature. When both social and private costs are considered, the lowest-cost technology genera...

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Bibliographic Details
Published in:The Electricity journal 2012-03, Vol.25 (2), p.7-15
Main Authors: Keske, Catherine M.H., Evans, Samuel G., Iverson, Terrence
Format: Article
Language:English
Subjects:
Cost
Electric power
Electricity
Electricity pricing
Marketing
Markets
Pollutants
Pricing
Tariff
Tariffs
Technology
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Description
Summary:This technology-neutral marginal cost pricing approach can integrate the private and social costs of electricity generation. The pricing methodology borrows from the adders and value-based feed-in tariff literature. When both social and private costs are considered, the lowest-cost technology generally (but not necessarily) involves lower amounts of environmental pollutants.
ISSN:1040-6190
1873-6874
DOI:10.1016/j.tej.2012.02.004