Research On Demand Side Management Incentive Theories

Although DSM in China has achieved certain fruit in recent years, it still has a wide gap comparing with the developed countries'DSM and our huge potential energy efficiency of the terminals. According to international experiences, in order to implement DSM successfully, we must build up incentive mechanisms for grid companies, the main implementary bodies of DSM. However, our work in this field is almost a blank so far. The lack of incentive mechanisms has very seriously affected the implement of DSM in China. Therefore, how to play the leading role of government and arouse the enthusiasm of grid companies for implementing DSM has become a forefront problem, which needed to be solved urgently. Studying on grid companies'DSM incentive mechanisms has important theoretical value and practical meaning.On the basis of analyzing and evaluating the DSM incentive mechanism of foreign countries systematically, this paper emphasizes the incentive mechanisms of grid compnies for inmplementing DSM, puts forward decoupling mechanism mode of grid companies, DSM investment cost recovery mechanism mode and DSM bonus incentive mechanism modeThe primary innovations are as follows:1.On the basis of applying the market subdivision principle to subdivide the users, this paper puts forward revenue-sales decoupling mechanism mode, makes a thorough study on how to adjust the grid company's yearly permited revenue and applies it to a concrete example.2.This paper studies Chinese grid companies'DSM investment cost recovery mechanism and mainly discusses the method that puts costs in rate base as fixed assets, and points out the advisory rate-of-return and the amortization period.3.For the DSM programs to obtain maximum social benefit, applying principal-agent theory, this paper demonstrates that the optimal award mechanism adopted by the regulator for the grid company under the asymmetric information circumstance is shared savings incentive mechanism.4.This paper analyzes grid companies'hidden costs. Since the hidden costs cannot beobserved, the regulator often neglects to compensate them, and this can cause grid companies do not be willing to implement DSM. It also puts forward the quantizing method of hidden costs, and describes the hidden costs'curve of various possibilities and further analyzes the relationship between hidden costs and DSM net benefits.5.On the basis of comparing marginal incentive rates for shared-savings incentive mechanisms, this paper discusses the influence of MIR to DSM, puts forward that the optimal marginal incentive rate should be 100 percent, and carries on empirical analysis. In order to eliminate misgivings to 100% MIR that may make much pay to the grid companies and cause unfair proportional distribution of society, marginal incentives can be set separately from one another through the use of a fixed charge. At last, on the basis of analyzing the risk of DSM award mechanism, methods for preventing the risks are put forward in this paper.