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Haglund, L., Kovala, T. & Lindh, C. (2019). Managing complexity through business relationships: The case of the Swedish electricity market. International Journal of Management and Decision Making, 18(2), 209-227
Open this publication in new window or tab >>Managing complexity through business relationships: The case of the Swedish electricity market
2019 (English)In: International Journal of Management and Decision Making, ISSN 1462-4621, E-ISSN 1741-5187, Vol. 18, no 2, p. 209-227Article in journal (Refereed) Published
Abstract [en]

In the industrial market, electricity is an essential resource for production, as a stop in its flow may cause expensive production loss and thus tremendous cost. This strong resource dependence and the inevitable competition that comes with deregulation of the market, makes the electricity business complex and relationships of long-term orientation to form. To study such relationships, a mixed method is applied to provide contextual knowledge: by four interviews and a descriptive model and a structural model with three hypotheses developed (n = 122). Managers of products that may seem simple and traded in a market where low cost prevails should think again - stable relationships are a necessity for rational decisions also in this case, particularly since interdependence is influential. 

Place, publisher, year, edition, pages
Inderscience Enterprises Ltd., 2019
Keywords
Business relationship, Buyer-seller relationships, Commitment, Complexity, Deregulation, Electricity intensive industry, Electricity retailers, Interdependence, Mixed method, Pricing, Production resource management, Services, Structural equation modelling, Swedish electricity market, Trust
National Category
Economics and Business
Identifiers
urn:nbn:se:mdh:diva-43131 (URN)10.1504/IJMDM.2019.098657 (DOI)2-s2.0-85063726014 (Scopus ID)
Available from: 2019-04-18 Created: 2019-04-18 Last updated: 2019-06-25Bibliographically approved
Kovala, T. (2017). This electricity price is too high for my household: Why are some households sensitive to the electricity price, when others barely are sensitive at all?. In: : . Paper presented at 5th Nordic Conference on Industrial Engineering and Management (ScAIEM), 27-29 November 2017, Trondheim, Norway.
Open this publication in new window or tab >>This electricity price is too high for my household: Why are some households sensitive to the electricity price, when others barely are sensitive at all?
2017 (English)Conference paper, Poster (with or without abstract) (Other academic)
Abstract [en]

The key-solution for a sustainable electricity system is demand flexibility. If we use technology to distribute the information, demand flexibility could be incentivized by dynamic pricing, so that real problems and costs in the electricity system become transparent for electricity consumers.

Utilities and electricity retailers have tried to offer such contracts before, but deemed the necessary educative interventions for consumers too expensive and retreated to nominal price competition (Flaim et al., 2013). Using a questionnaire, collecting intentions for demand flexibility, we reveal that lacking knowledge is just one of many areas that could be targeted with interventions.

Keywords
Behavioural intervention, Consumption flexibility, Dynamic pricing, Electricity price, Habits, Home-automation, Households, Intuitive behaviour, Price sensitivity
National Category
Economics Energy Systems Social Sciences Interdisciplinary
Research subject
Industrial Economics and Organisations
Identifiers
urn:nbn:se:mdh:diva-37575 (URN)
Conference
5th Nordic Conference on Industrial Engineering and Management (ScAIEM), 27-29 November 2017, Trondheim, Norway
Projects
Flexibla elkunders roll i ett framtida förnybart kraftsystem
Funder
Swedish Energy Agency, P39736-1
Available from: 2017-12-23 Created: 2017-12-23 Last updated: 2018-01-13Bibliographically approved
Kovala, T. (2016). Deciding about electricity usage: A thesis on market incentives to steal focus from electricity consumers. In: : . Paper presented at 4th Nordic Conference on Industrial Engineering and Management (ScAIEM), 28-30 November 2016, Luleå, Sweden.
Open this publication in new window or tab >>Deciding about electricity usage: A thesis on market incentives to steal focus from electricity consumers
2016 (English)Conference paper, Oral presentation with published abstract (Other academic)
Abstract [en]

The electricity systems in the world will go through dramatic development to reach the sustainable and fully-renewable state of which politicians aim for. Flexibility is a key-word in such a system, and to achieve high levels of flexibility in a cost-efficient way the demand-side of the electricity system and electricity market has to be activated, the common name for this approach is Demand Response. The purpose in the thesis proposal is to analyse the ways residential electricity consumer-behaviour can be changed, depending on the setup of the Demand Response program implemented in the electricity market, and in turn predict the potential flexibility of consumers in Swedish electricity system context. The analysis will contribute to the development of consumer behaviour research for markets connected to infrastructural systems, with its focus on market setup parameters beyond market price, specifically incorporating multiple aspects of time. The main research topics which could contribute to this analysis are primarily economic preference theory together with bounded rationality incorporating aspects of time and intuitive decisions. The analysis is built up by an understanding of the context of these decisions through service management theory in the specific practice of a national infrastructure. These theories have all been used separately to understand market behaviour and will be combined in this interdisciplinary analysis of future behaviour on the electricity market.

Keywords
infrastructural system services, intuitive decision-making, preference theory, price elasticity, time-dependent consumption
National Category
Economics Business Administration
Identifiers
urn:nbn:se:mdh:diva-34970 (URN)
Conference
4th Nordic Conference on Industrial Engineering and Management (ScAIEM), 28-30 November 2016, Luleå, Sweden
Projects
Flexibla elkunders roll i ett framtida förnybart kraftsystem
Funder
Swedish Energy Agency, P39736-1
Available from: 2017-02-28 Created: 2017-02-28 Last updated: 2017-02-28Bibliographically approved
Kovala, T., Wallin, F. & Hallin, A. (2016). Factors influencing industrial excess heat collaborations. Paper presented at Applied Energy Symposium and Summit on Low-Carbon Cities and Urban Energy Systems, CUE 2015, 15 November 2015 through 17 November 2015. Energy Procedia, 88, 595-599
Open this publication in new window or tab >>Factors influencing industrial excess heat collaborations
2016 (English)In: Energy Procedia, ISSN 1876-6102, E-ISSN 1876-6102, Vol. 88, p. 595-599Article in journal (Refereed) Published
Abstract [en]

In Sweden there is a potential to double the amount of industrial excess heat from todays 5 TWh that is delivered into district heating networks. This paper investigates factors that are influencing industrial excess heat collaborations. The paper presents result from qualitative interviews as well as answers through a more quantitative web based survey which has been sent out to stakeholders in existing Swedish industrial excess heat collaborations. This work provides new evidence on that economic motivations are the most common driver for starting up a collaboration, but well in place factors like transparency as well as investment sharing between the partners becomes important for a long-term successful collaboration.

National Category
Energy Engineering
Identifiers
urn:nbn:se:mdh:diva-34615 (URN)10.1016/j.egypro.2016.06.084 (DOI)000387975200091 ()2-s2.0-85007593776 (Scopus ID)
Conference
Applied Energy Symposium and Summit on Low-Carbon Cities and Urban Energy Systems, CUE 2015, 15 November 2015 through 17 November 2015
Available from: 2017-01-13 Created: 2017-01-13 Last updated: 2017-11-29Bibliographically approved
Kovala, T. (2016). Flexibla elkunders roll i ett framtida förnybart kraftsystem: Hur kommer framtidens elkunder besluta om sin elanvändning?. In: : . Paper presented at HUB2016 - Energy Conference Västerås, 24 November 2016, Västerås, Sweden.
Open this publication in new window or tab >>Flexibla elkunders roll i ett framtida förnybart kraftsystem: Hur kommer framtidens elkunder besluta om sin elanvändning?
2016 (Swedish)Conference paper, Poster (with or without abstract) (Other (popular science, discussion, etc.))
Abstract [sv]

Erbjud elkunderna rätt service!

Framtidens elkunder kommer möta ett bredare utbud av tjänster, avtal och produktpaket som bland annat ska kunna uppmuntra en högre grad av efterfrågeflexibilitet. En av flera viktiga aspekter för hur elkunderna kommer agera, är marknadens signal för efterfrågeflexibilitet. Bland annat är elkundernas möjlighet att planera och förbereda sin flexibilitet en mycket intressant variabel för den framtida efterfrågeflexibilitetens potential.

Keywords
aktiva elkunder, efterfrågeflexibilitet, framtidens elmarknad, ledtid, tjänster
National Category
Business Administration Economics Energy Systems
Identifiers
urn:nbn:se:mdh:diva-34971 (URN)
Conference
HUB2016 - Energy Conference Västerås, 24 November 2016, Västerås, Sweden
Projects
Flexibla elkunders roll i ett framtida förnybart kraftsystem
Funder
Swedish Energy Agency, P39736-1
Available from: 2017-02-28 Created: 2017-02-28 Last updated: 2017-02-28Bibliographically approved
Herre, L., Kovala, T., Söder, L. & Papahristodoulou, C. (2016). ON THE FLEXIBILITY OF ELECTRICTY CONSUMERS: Modelling, Quantification and Analysis of Notice Time. In: : . Paper presented at Swedish Association for Energy Economics (SAEE) Conference 2016, Luleå, August 23-24, 2016.
Open this publication in new window or tab >>ON THE FLEXIBILITY OF ELECTRICTY CONSUMERS: Modelling, Quantification and Analysis of Notice Time
2016 (English)Conference paper, Oral presentation with published abstract (Refereed)
Abstract [en]

Power systems with a large share of inherently intermittent renewable energy sources require new approaches to system operation. Demand response is seen as a potential possibility for contributing to maintaining power balance in a future energy system with large amounts of volatile renewable energy generation (Bartusch et al., 2011; Torriti, Hassan & Leach, 2010). It would be a measure to reduce costs for maintaining the power balance, which is believed to become more expensive if traditional measures is to handle the increasing intermittency (Albadi & El-Saadany, 2008; Kirschen, 2003; Siano, 2014). The study of the flexibility of electricity demand is an essential key to exploring the current and future potential of demand side response for power system services.  

For both solar and wind power, forecasts for several hours ahead may have a lower accuracy. Statistically, the forecasts become better the closer they approach real operation. In practice however, this does not happen in each case. This means that the flexibility need for a certain hour will be different, depending on when the need is identified, i.e. different notice times.

For consumers to be flexible, there are several parameters that impact their ability and willingness to react to incentives with a change of load. Elasticity (self- and cross-elasticity) has been defined in literature to describe consumer flexibility with respect to a change of electricity price and is often referred to when modelling the flexibility of consumers (Albadi & El-Saadany, 2008; Lijesen, 2007). Flexibility with respect to electricity prices or other financial incentives has been widely studied in literature on smart grids and demand response.

Another important parameter for electric demand to be flexible is the notice time, i.e. the time span between informing the consumer about a future need for reorganizing their consumption and providing a change of consumption as a system service. The impact of notice time on the flexibility of electricity consumers has not yet been systematically researched. It is logical that the willingness and ability of certain consumers to provide flexibility decreases as notice time becomes shorter. There are, however, some loads that even may become more flexible, the shorter the notice time, such as e.g. the charging of electric vehicles.  

An essential basis for flexible consumers is the communication infrastructure that is used for sending price signals, bids and further market parameters depending on the demand response program. The type and information content of such communication is enabled through technological devices. These smart devices – which in most cases must exceed the function of only smart metering (Siano, 2014) – can have different properties and requirements that are determined by the demand response program and its respective requirements on data exchange. Therefore, the technological implementation and the impact of the limitations originating from the same are discussed in this study as well.  

For a quantitative analysis of customer flexibility, both price and notice time are imperative parameters. Former has been studied in numerous references (Bartusch et al., 2011; Gyamfi, Krumdieck & Urmee, 2013; Kirschen et al., 2000; Lijesen, 2007) whereas the impact of the latter has not yet been examined in depth. In this paper, a study on consumer flexibility with respect to notice time is presented. It is analyzed how the ability to reschedule electricity demand during a time interval in the future is impacted by terms of notifying and updating flexible consumers. For this, a market and demand response program optimizing social welfare is developed that allows for an analysis of notice time dependent consumers.

Keywords
communication infrastructure, demand response program, electricity consumption, flexibility, notice time, power system services, price elasticity, renewable energy, wind power forecast
National Category
Economics Energy Systems
Identifiers
urn:nbn:se:mdh:diva-34963 (URN)
Conference
Swedish Association for Energy Economics (SAEE) Conference 2016, Luleå, August 23-24, 2016
Projects
Flexibla elkunders roll i ett framtida förnybart kraftsystem
Funder
Swedish Energy Agency, P39736-1
Available from: 2017-02-28 Created: 2017-02-28 Last updated: 2017-02-28Bibliographically approved
Organisations
Identifiers
ORCID iD: ORCID iD iconorcid.org/0000-0002-5784-877X

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