Evaluating Electricity Demand Elasticity From a Social Perspective: Implications for Sustainable Development and Urban Resilience

Abstract

The central focus of this study revolves around constructing a comprehensive load model to estimate the elasticity of electricity demand predicated on customers' risk-averse tendencies. This model serves as the foundation for designing a proficient demand response program. Moreover, a welfare function is employed to ascertain the optimal incentives to motivatecustomers to curtail their electricity consumption. Given Iran's recent socioeconomic challenges marked by a high inflation rate and inadequate investment in power plants, data from the Iranian power system is employed to validate the efficacy of the proposed model in the numerical analysis. The findings reveal that customers exhibiting higher levels of risk aversion tend to derive greater satisfaction from consuming electricity and consequently necessitate more substantial incentives to prompt a reduction in their demand. Additionally, the results highlight that variations in electricity prices can counterbalance the impact of income increases on consumption patterns.