Price elasticity of district heating
Publicerad
Författare
Typ
Examensarbete för masterexamen
Master's Thesis
Master's Thesis
Modellbyggare
Tidskriftstitel
ISSN
Volymtitel
Utgivare
Sammanfattning
Although district heating is a well established industry in Sweden it still faces challenges.
One of these is their way of charging customers for supplied heat. These
price models are often complicated to understand for both customers and company
employees as well as sensitive for weather making it hard to predict income. The
price itself could also affect the energy use which is relatively unexplored in DH.
Therefor an analysis of how price elasticity can be used to predict energy use was
done. It was done by doing a literature study which was followed by an interview
study and creating three models, modelling the energy of two networks, in order to
see if using price elasticity when setting prices is a good approach. The thesis also
examines the what kind of building that is consuming the heat and the effect that
has on the price elasticity. Lastly the thesis also investigates the correlation between
district heating use and electricity prices in order to see if users of district heating
increases their use of district heating instead of using other heating options.
The literature study concludes that the price elasticity of demand for district heating
is inelastic, meaning that the changes in demand are rather small compared to the
price changes.
The interview study concludes that district heating companies do think of price
elasticity when setting prices but would be interested to use it in the future to
better predicts revenues.
The studied models for elasticity show that the use of price elasticity in setting DH
prices is somewhat unnecessary as the elasticity in literature as well as historically
in the networks are rather low. The results also indicates that the use of individual
metering for households in multi family buildings makes a difference on the elasticity
in some capacity however it still remains rather inelastic.
Lastly there is low correlation between electricity prices and district heating use for
most of the year.
Beskrivning
Ämne/nyckelord
district Heating, price elasticity, energy use