Abstract
Interruptible and curtailable service contracts for electricity have gained popularity over the last decade as an efficient method for reducing utilities’ operating cost and mitigating capacity shortages. Discounts are offered to customers (usually industrial) who allow part of their load to be curtailed at the utility’s discretion. The contracts typically specify the warning time, the customer’s firm power level, the maximum duration and the maximum frequency of the curtailments. In some cases, customers can choose the terms of their contract from a menu that specifies the discounts associated with various available sets of options.
Portions of this paper reprinted with permission from Operations Research, vol. 4, no. 2, 1992, Operations Research Society of America. No further reproduction permitted without the consent of copyright owner.
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Oren, S.S., Smith, S.A. (1993). Design and Management of Curtailable Electricity Service to Reduce Annual Peaks. In: Oren, S.S., Smith, S.A. (eds) Service Opportunities for Electric Utilities: Creating Differentiated Products. Topics in Regulatory Economics and Policy Series, vol 13. Springer, Boston, MA. https://doi.org/10.1007/978-1-4615-3140-1_9
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