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July 06, 2010
The Brattle Group Authors Paper on the Impact of Dynamic Pricing on Low Income Customers

Brattle principal Ahmad Faruqui and research analyst Jennifer Palmer, both of the San Francisco office, and associate Sanem Sergici of the Cambridge office, recently authored “The Impact of Dynamic Pricing on Low Income Customers,” which was prepared for the Edison Foundation’s Institute of Electric Efficiency. The paper provides new empirical information to help resolve what is today one of the most controversial topics in regulatory proceedings involving the smart grid. It draws upon results from four recent dynamic pricing programs in California, Connecticut, the District of Columbia, and Maryland. It also presents early results from a full scale program that is being rolled out by Pacific Gas & Electric Company in California. Further, for completeness, results are also presented from California’s older but widely-cited Statewide Pricing Pilot. The paper’s core finding is that many low income customers would benefit even without shifting their load profile. Additionally, the paper shows that many low income customers do shift their load in response to price signals. Taken together, the results show that concerns that have been voiced about the adverse impact of dynamic pricing on low income customers are not grounded in reality. For further questions, please contact Ahmad Faruqui via email at or +1.415.217.1000. “The Impact of Dynamic Pricing on Low Income Customers” can be downloaded from the IEE Website.