Skip to Main content Skip to Navigation
Journal articles

Lin, B., Jiang, Z, 2012. Designation and influence of household increasing block electricity tariffs in China. Energy Policy 42, pp. 164-173: How biased is the measurement of household's loss?: How biased is the measurement of household's loss?

Abstract : The three-tier inclining block tariff (‘‘IBT’’) issued by the Chinese government in 2010 is focusing attention of energy economists, among whom Lin and Jiang (2012. Designation and influence of household increasing block electricity tariffs in China. Energy Policy 42, 164–173) who assert that the issued tariff is unsuited to meet the social and environmental objectives it was designed for. These authors offer an alternative four-tiered IBT, the performance of which they show by evaluating its welfare and income distribution effects taking the current uniform tariff as reference. To measure the surplus loss to a representative household in a given block the authors use the trapezoid approach. But, because of the limited data on demand, they calculate the household’s response by using a constant point estimate of the own-price elasticity of electricity demand. In this note I show there is an incompatibility between these two modeling assumptions. Combining them is causing an upward bias in the surplus loss, which is of significance given the large price change associated with the IBT. I then offer a correction to this bias.
Complete list of metadata

https://hal-sciencespo.archives-ouvertes.fr/hal-02314758
Contributor : Spire Sciences Po Institutional Repository Connect in order to contact the contributor
Submitted on : Sunday, October 13, 2019 - 6:11:17 PM
Last modification on : Wednesday, September 29, 2021 - 4:54:24 PM

Identifiers

Collections

Citation

Evens Salies. Lin, B., Jiang, Z, 2012. Designation and influence of household increasing block electricity tariffs in China. Energy Policy 42, pp. 164-173: How biased is the measurement of household's loss?: How biased is the measurement of household's loss?. Energy Policy, 2012, 48 (Special Section: Frontiers of Sustainability), pp.843 - 845. ⟨hal-02314758⟩

Share

Metrics

Record views

80