We are actively building capability in energy market design. Important links have been established between the Centre for Market Design and the Melbourne Energy Institute to identify market structure problems in the electricity sector and to undertake research needed to address these problems. We have commenced a new policy project to examine the interaction between smart meters and real-time pricing in competitive retail electricity markets. The project examines the impact of retailers’ strategies to base customer charges on individual energy consumption patterns. It focuses on search costs, customer poaching, averse selection and market unravelling to explore the potential market impacts of revealing customer costs through smart meters. This project will contribute to the design of an effective regulatory environment in a changing electricity market.
Read David Byrne’s blog on the imminent arrival of dynamic electricity pricing plans.