Marginal cost pricing revisited
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Cited by (10)
How can pricing strategy for district heating help China realize cleaner residential heating?
2022, Energy EconomicsCitation Excerpt :By contrast, both fixed and variable costs are variable in the long term since the supplier can change the total capacity of production. Marginal-cost pricing can avoid deadweight losses (Schramm, 1991). In principle, it is more efficient to set the price to short-run marginal cost (Li et al., 2015); however, in industries with economies of scale, such as that of DH, the short-run marginal cost is low, leading to under-recovery of costs over time (Li et al., 2015).
A review of the pricing mechanisms for district heating systems
2015, Renewable and Sustainable Energy ReviewsCitation Excerpt :In such a case, incremental costs should be applied only to the identifiable “excess” portion of production, rather than to the total level of supply. If there are no buyers for the excess portion of supply, it would be economically better to keep the “excess” facilities idle, rather than trying to dispose of this surplus capacity by reducing the price to a new equilibrium level [41]. As discussed before, both the cost-plus pricing and marginal-cost pricing methods have disadvantages.
Key technologies on heating/cooling cost allocation in multifamily housing
2008, Energy and BuildingsCalculating the marginal costs of a district-heating utility
2004, Applied EnergyMunicipal thermal and electricity loads - A case study in Linköping
1998, Applied Thermal EngineeringEnergy economics: Concepts, issues, markets and governance, 2nd ed. 2019
2019, Energy Economics: Concepts, Issues, Markets and Governance, 2nd ed. 2019