Dynamic pricing

About: Dynamic pricing is a research topic. Over the lifetime, 4144 publications have been published within this topic receiving 91390 citations. The topic is also known as: surge pricing & demand pricing.

Grid integration of distributed renewables through coordinated demand response

Abstract: There is a growing interest in developing solutions to facilitate large scale integration of distributed renewable energy resources and, in particular, contain the adverse effects of their volatility. In this paper, we introduce a neighborhood-level demand response program that aims at coordinating the Home Energy Management Systems (HEMS) of residential customers in order to opportunistically consume spikes of locally generated renewable energy. We refer to this technique as Coordinated Home Energy Management (CoHEM). Our model predictive control technique modulates the aggregate load to follow a dynamically forecasted generation supply. Both centralized and decentralized deployments of CoHEM are considered. The decentralized version requires a more demanding communication backbone to connect individual HEMS but, it is more resilient to failures of individual computational units or communication links and, compared to the centralized model, it preserves consumers privacy. In our numerical results section, we compare the scenario where individual HEMS optimize their energy use selfishly, under a hypothetical dynamic pricing program, to the performance of the centralized and decentralized versions of our proposed CoHEM architecture. The results highlight the advantages of using the CoHEM model in absorbing the fluctuations in the generation output of distributed renewables.

Dynamic pricing and market segmentation responses to low-cost carrier entry

Abstract: This paper develops an empirical model of online airfares to inspect the impact of the entry of a low-cost carrier (LCC). We utilize a database collected from the website of an online travel agent in Brazil. We test whether incumbents reshape their airfare temporal profiles in an attempt to attract the price-sensitive passengers who constitute the target market of the newcomer. Our results suggest that LCC entry partially spoils the existing market segmentation schemes of incumbents, forcing them to revise their distribution management strategy, simplify their fare structure and migrate from a non-monotonic to a weakly monotonic price curve.

Smart pricing scheme: A multi-layered scoring rule application

Abstract: Defining appropriate pricing strategy for smart environment is important and complex task at the same time. It holds the primal fraction in Demand Response (DR) program. In our work, we devise an incentive based smart dynamic pricing scheme for consumers facilitating a multi-layered scoring rule. The proposed strategy characterizes both incentive based DR and price based DR programs facilities. This mechanism is applied between consumer agents (CA) to electricity provider agent (EP) and EP to Generation Company (GENCO). Based on the Continuous Ranked Probability Score (CRPS), a hierarchical scoring system is formed among these entities, CA-EP-GENCO. As CA receives the dynamic day-ahead pricing signal from EP, it will schedule the household appliances to lower price period and report the prediction in a form of a probability distribution function to EP. EP, in similar way reports the aggregated demand prediction to GENCO. Finally, GENCO computes the base discount after running a cost-optimization problem. GENCO will reward EP with a fraction of discount based on their prediction accuracy. EP will do the same to CA based on how truthful they were reporting their intentions on device scheduling. The method is tested on real data provided by Ontario Power Company and we show that this scheme is capable to reduce energy consumption and consumers' payment.

A Dashboard for Online Pricing

Abstract: One primary difference between the online marketplace and the high street is the quality of information about product characteristics and prices that are available to all consumers and retailers. Successful online retailers exploit this rich information through innovative dynamic pricing strategies. This article identifies important considerations for devising online pricing strategies. It presents five case studies that illustrate how these strategies have been applied by successful online retailers and discusses complementary practices in innovative management and data analysis. We present a 9Dashboard9 of market specific information that will help managers identify and respond to opportunities and threats arising in the online marketplace.

Economically enhanced resource management for internet service utilities

Abstract: As competition on global markets increases the vision of utility computing gains more and more interest. To attract more providers it is crucial to improve the performance in commercialization of resources. This makes it necessary to not only base components on technical aspects, but also to include economical aspects in their design. This work presents an framework for an Economically Enhanced Resource Manager (EERM) which features enhancements to technical resource management like dynamic pricing and client classification. The introduced approach is evaluated considering various economic design criteria and example scenarios. Our preliminary results, e.g. an increase in achieved revenue from 77% to 92% of the theoretic maximum in our first scenario, show that our approach is very promising.