Research Article | Open Access
Dynamic Pricing and its Impact on the Utility Industry: Adoption and Benefits
Satyaveda Somepalli
Pages: 1416-1424
Abstract
Dynamic pricing has revolutionized the utility industry by enabling flexible rate adjustments based on realtime supply and demand and addressing challenges such as peak load management, resource efficiency, and renewable energy integration. This study explores the adoption and benefits of dynamic pricing for electricity, water, and natural gas utilities, highlighting its role in promoting sustainable consumption, reducing grid pressure, and driving inancial savings for both utilities and consumers. Key models, such as Time-of-Use (TOU), Real-Time Pricing (RTP), and Critical Peak Pricing (CPP), are analyzed alongside enabling technologies, such as smart meters and IoT devices. Case studies of Pacific Gas and Electric (PG&E) and Baltimore Gas and Electric (BGE) illustrate the effectiveness of Dynamic Pricing in reducing peak demand, improving grid stability, and enhancing customer satisfaction. The paper also addresses challenges in infrastructure, customer behavior, and regulatory frameworks, offering strategies for overcoming these barriers. Emerging trends such as AI-driven analytics, decentralized energy markets, and integration with renewable energy resources underscore the transformative potential of dynamic pricing in a sustainable and efficient utility sector.
Keywords
Dynamic pricing, utility industry, Time-of-Use pricing, Real-Time Pricing, Critical Peak Pricing, renewable energy integration, smart meters, IoT, grid stability, sustainable consumption, energy efficiency, regulatory frameworks, customer behavior, Pacific Gas and Electric, Baltimore Gas and Electric.