How much do electric customers want to pay for reliability: New evidence on an old controversy

Electric utilities are facing competitive challenges from independent power producers, cogenerators, qualifying facilities, and customer bypass, in addition to increasing resistance to building new capacity whether it be conventional or nuclear. Utilities are meeting these challenges by offering an array of demand-side management programs and differentiated tariffs that better match utility rates and customer preferences for service reliability. Customer preferences for service reliability may be gathered by market survey, however, survey estimates are subject to various common criticisms a fact that has retarded the adoption of this approach. by using power survey design techniques and statistical methods, the authors show in this paper, how accurate customer value of service reliability data may be collected with a market survey. Copyright © 1991 Taylor & Francis.