Household Price Elasticity of Demand as a Tool for Tariff System Design Leading to Increase of Electricity use for Space Heating Purposes

This article presents the issue of electricity consumption for space heating purposes. High share of fossil fuels used for space heating leads to high pollution emission. A solution for this problem may be encouraging customers to use electricity as an energy carrier for space heating, by proposing appropriate tariffs. Diverse electricity tariffs for households are described, differing in energy prices and distribution rates in certain periods of a day. Demand price elasticity is calculated by comparing energy increases in zones using standard load profiles of customers settled according to the flat tariff and the time of use tariff. The values of demand price elasticity are then used to create customers' load profiles based on price changes within newly proposed tariffs. A forecast of the consumption rise resulting from the new implemented anti-smog tariff motivating consumers to use electricity during the low load period in the Polish power system is presented.