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Utility competition, DSM, and piano bars: The fatal flaw

C.M. Studness

Open publisher page 1 citations

Abstract

This article is an economic analysis of demand side management (DSM). The author contends that utilities and regulators have lost sight of their primary mission of providing electric power as efficiently as possible; DSM conflicts with this mission. DSM measures have not be submitted to a market test, so utilities are not necessarily providing the customers with what they want. This situation is compared to the airline industry before deregulation, when airlines provided expensive services that customers did not want. Also, with present technology, DSM measures consume more in total resources than it what it costs to produce electricity, thereby depleting the nation's resources at a greater rate.

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What this paper is about

This article is an economic analysis of demand side management (DSM). The author contends that utilities and regulators have lost sight of their primary mission of providing electric power as efficiently as possible; DSM conflicts with this mission. DSM measures have not be submitted to a market test, so utilities are not necessarily providing the customers with what they want. This situation is compared to the airline industry before deregulation, when airlines provided expensive services that customers did not want. Also, with present technology, DSM measures consume more in total resources than it what it costs to produce electricity, thereby depleting the nation's resources at a greater rate.

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Available abstract

This article is an economic analysis of demand side management (DSM). The author contends that utilities and regulators have lost sight of their primary mission of providing electric power as efficiently as possible; DSM conflicts with this mission. DSM measures have not be submitted to a market test, so utilities are not necessarily providing the customers with what they want. This situation is compared to the airline industry before deregulation, when airlines provided expensive services that customers did not want. Also, with present technology, DSM measures consume more in total resources than it what it costs to produce electricity, thereby depleting the nation's resources at a greater rate.

Key concepts: Deregulation, Demand side, Competition (biology), Electric utility, Electric power industry, Business, Electricity, Electricity market

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