Electric Power ›› 2019, Vol. 52 ›› Issue (12): 113-122.DOI: 10.11930/j.issn.1004-9649.201908119

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Study on the Cross Subsidy of Electricity Price and the Measurement of Social Welfare Considering Residential Demand

YE Ze1,2, YAO Jun1,3, WU Yongfei1,2, HE Jiao1,2   

  1. 1. School of Economics & Management, Changsha University of Science & Technology, Changsha 410004, China;
    2. The Research Center of Modern Enterprises Management, Changsha 410004, China;
    3. Financial & Assets Department, State Grid Corporation of China, Beijing 100031, China
  • Received:2019-08-19 Revised:2019-09-16 Published:2019-12-05
  • Supported by:
    This work is supported by the project of the Key Research Base of Humanities and Social Sciences of Ministry of Education (No.18JJD790001),the National Social Science Foundation (No.17BJY059),the Scientific Research Project of Hunan Education Department (No.16K007) and the Key Project of Open Fund of Hunan Modern Enterprise Management Research Center (No.17qgzd02).

Abstract: The current cross-subsidy of electricity price is quite inefficient and unfair, and its accuracy of measurement and influence on social welfare are directly related to the level of electricity price of users and the design of the cross-subsidy settlement mechanism. The key to the measurement of cross-subsidy of electricity price lies in the verification of the benchmark price. Although the traditional cost-based measurement method considers the balance of income and expenditure of power enterprises, it is not the pricing result of welfare optimum. Starting from the perspective of demand pricing and aiming at maximizing social welfare, this paper constructs a measurement model of electricity price cross-subsidy, which mainly focuses on the users' demands pricing and the construction of demand function. The results show that the cross-subsidy and social welfare are related to the users' self-price elasticity, cross-price elasticity and the welfare weight coefficient of the regulatory agency. Finally, this paper accurately measures the self-price elasticity and the cross-price elasticity of various kinds of users through the empirical model, calculates the cross-subsidy of electricity price and the corresponding optimal social welfare, and verifies the accuracy and effectiveness of the proposed model.

Key words: users' demand, cross-subsidy, self-price elasticity, cross price elasticity, social welfare

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