The Number of Customers Using Dynamic Pricing Rates for Electricity Is Expected to Exceed 113 Million in 2025
A new report from Navigant Research explores the market drivers and barriers for global dynamic pricing in the electricity industry, with forecasts for number of customers segmented by pricing type, sector, and region, through 2025.Dynamic pricing, a concept in which the value of a product varies based on time or other factors, can be found in many aspects of society, including airline fares, sporting event tickets, and road tolls. In the electricity industry, the concept allows for rates that are indexed to real-time wholesale energy prices instead of a flat rate across all hours and variables. Click to tweet: According to a new report from @NavigantRSRCH, the number of customers on dynamic pricing rates globally is expected to rise from approximately 3.4 million in 2016 to 113.3 million in 2025.
“The concept of dynamic pricing for mass market electricity customers is fairly recent aside from time-of-use rates, which offer set prices for set on- and off-peak periods that do not vary during the tariff period,” says Brett Feldman, principal research analyst with Navigant Research. “However, with the proliferation of advanced meters that can record and communicate interval data, more dynamic types of pricing can be applied down to the residential level, encouraging growth in dynamic pricing programs.”Growth in the number of customers using dynamic pricing for electricity is expected to be robust during the next decade, particularly in North America, according to the report. This trend is expected to hold true throughout the forecast, even as other regions eventually start to implement dynamic pricing programs.
This report, Dynamic Pricing, examines the market drivers and barriers for the global dynamic pricing market. The report focuses on four major pricing types: real-time pricing (RTP), critical peak pricing (CPP), peak time rebates (PTR), and variable peak pricing (VPP). Global market forecasts for number of customers, broken out by pricing type, sector (residential and C&I), and region, extend through 2025. The report also examines case studies of dynamic pricing from around the world, summarizing their objectives and impacts, as well as the lessons learned.