21 Aug 2017 12:30pm to 02:00pm

Understanding Electricity Demand: behavioural aspects and policy interventions

Jörg Lingens
University of Münster
David Blowers
Grattan Institute
David Byrne
University of Melbourne

Curbing greenhouse gas emissions in order to fight climate change is imperative and one can think of two ways to do that. First, a decrease in electricity consumption would decrease the need to burn fossil fuels. Second, a change in electricity generation technologies using renewable energy sources would also decrease emissions. For both strategies to be successful, the electricity demand of households must decrease and/or needs to become more flexible.

However, the determinants of this demand and their effect is not easy to understand. Electricity is a very peculiar good such that many behavioral frictions affect the households' consumption choice. Households usually lack information concerning the production technology of energy services and is compounded by the billing structure of electricity. 

With hyperbolic discounting households' behavior exhibits a present bias, which also affects their technology choice(s). In this research, Dr Jörg Lingens will discuss the likely effects of these behavioural issues on electricity demand and about possible policy options that nudge households to lower electricity usage.

Dr David Byrne, University of Melbourne, will chair the seminar and David Blowers, Grattan Institute, will be a discussant.


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