Egyptian Electricity Market : Desginning a Prudent Peak Load Pricing Model

The theory of Peak Load Pricing has been a theme of wide discussion amongst economists for many decades. It is considered a topic of great interest and controversial. The need for applying such different pricing strategy basically emerged in response to problems that face most public utilities. For instance non-storability;stochastic instability of demand and demand time varying where capacity is not uniformly utilized.In addition,to this problem, electricity prices in Egypt had been set significantly lower than the real economic cost of its production and supply which encourages more energy misuse by different customers and further fluctuation in demand. Therefore,the energy sector in Egypt especially electricity is in a bad need for introducing new pricing system and accounting reform, which will enable the utility to enjoy a healthier financial situation and better economic performance. Accordingly, this book seeks such a solution,especially in the context of electricity efficient pricing.It addresses one of the most successful pricing theories;the PLP theory, which will be constructive in this case, as it would decrease the utility costs and increase its efficiency and profit.