Siva Nagappan Visvesvaran

Exploring domestic individual consumer response to financial gain and loss scenario under demand response programs

The aim of this dissertation is to explore the response of consumers towards residential demand response (DR) of electricity under a gain and loss electricity pricing scenario on electricity tariffs. Methods of altering consumer behaviour are needed to balance the demand and supply of electricity as a shift towards renewables leads to a fluctuating supply of electricity within the grid. Despite an interest in behavioural change approaches, such as DR, there is a lack of research into the type of tariff structures that result in sustainable consumption of energy during periods of limited generation capacity. To explore this gap, a methodology was developed where participants undertook a series of simulations with three DR tariffs: Peak Time Rebate (PTR), which provided a rebate for every kWh saved during DR, Critical Peak Pricing (CPP), which increased the price per kWh for a certain period, and control which had no financial implications. Results show that participants in the CPP scenario had the highest mean energy saving; 56% and 53% for morning and night respectively. However, all participants in the loss scenario preferred a higher financial incentive of more than 30% on top of their current savings, whereas participants in the gain scenario stated they did not require a financial incentive. The study observed three motivations resulting in a change in consumption: extrinsic motivation, intrinsic motivation, and a combination of the two. Overall, DR is an effective tool in mediating the transition to intermittent electricity sources, however, the characteristics of pricing structures are likely to alter the efficiency of DR as a behavioural change tool.