• The Transactions of The Korean Institute of Electrical Engineers
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• v.63 no.7
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• pp.889-895
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• 2014

Korea electric power industry had been under vertical monopoly but is typically getting restructured for free competition. An ideal pricing system under the competitive market system is 'unbundled pricing system' and 'marginal pricing system', but the current pricing system still adheres to the traditional bundled system and the average cost pricing system. Especially, progressive electricity rates for residential use reflect governmental policy-making which is focused on income redistribution & welfare, industrial supports and energy saving. This study proposes new and reasonable residential electricity pricing systems which are Time-Of-Use (TOU) and Real-Time Pricing (RTP) to reflect variations in the wholesale price of electricity. It also presents examples of various tariffs for residential electricity pricing systems.

• The Journal of Korea Institute of Information, Electronics, and Communication Technology
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• v.13 no.2
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• pp.159-168
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• 2020

Current residential electricity rates, which are charged regardless of consumption patterns, have a problem of restricting consumer choice. In order to improve the problem, the Korea government started a demonstration project based on Time-Of-Use(TOU) pricing from September 2019. However, the analysis of its effect is still limited. This study analyzed the changes and limitations of TOU pricing compared to the current progressive pricing. The result showed that the high rate payer's bill decreased by up to 33.8 % while the low rate payer's bill increased by up to 117.7 %. This can lead to the problem of accepting electricity rates from a social point of view. In this study, TOU pricing based on progressive pricing was proposed to overcome the problem. The results presented the rate changes depending on the power consumption patterns while decreasing the average rate change from 32 % to -1.9 %. It means that the proposed pricing can support the TOU effect while maintaining the framework of the existing progressive pricing.

• Architectural research
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• v.19 no.3
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• pp.71-77
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• 2017

Dynamic pricing refers to a system in which a tariff varies, according to a level of charging and applied time depending on time change. The power billing system used in the Korean Electric Power Corporation (KEPCO) is based on time of use (TOU) pricing, which is one of the dynamic pricing systems. This paper aimed to determine the operational results of a variable refrigerant flow system, to which a new control algorithm was applied, in order to respond to dynamic pricing, in summer and the utility of the new control. To do this, real measured data was acquired from a VRF system installed in a building for educational purposes, where dynamic pricing was applied for about 100 days during summer time. At the maximum load operation time period in TOU, the new control minimized operation within the indoor comfort range, an increase in refrigerant evaporation temperature in the indoor unit and the number of revolutions in a compressor in the outdoor unit was limited. As a result, power usage was decreased by 11%, and the operational cost by 14.6%. Furthermore, measurement results using the Predicted Mean Vote (PMV) model, that represented satisfaction of thermal environment, showed that 82.8% to 90.4% of the occupants of the building were satisfied during operation when the new control was applied.

• The Transactions of The Korean Institute of Electrical Engineers
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• v.59 no.11
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• pp.1964-1970
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• 2010

A new intelligent power network (Smart Grid) that grafts some new technologies, such as the extension of the new and reproducible energy, electric motors, and electric storages, onto the regulation of green house gases according to the recent convention on climate changes has been actively promoted. As establishing such an intelligent power network, it is possible to implement a real-time rate system according to the change from the conventional single directional information transmission to the bidirectional information transmission. Such a real-time rate system can provide power during the chip rate hour by avoiding the high rate hour although customers use the same level of power through providing such real-time rate information including power generation costs. In this study, the establishment of an operating system that makes an effective use of the real-time rate system and its operation method are to be proposed.

• Korean Management Science Review
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• v.31 no.1
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• pp.27-40
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• 2014

Tour products have been recognized as a perishable asset. For tour operation companies (TOCs), improving profitability is a core decision problem for their business. Since package tour products, typical products of TOCs, are perishable after the tour was departed, TOCs have been tried to increase their sales before the departure date with various marketing strategies including price discounts. The pricing problem for perishable assets have been studied in Revenue Management for a long time. However, it is hard to find a research on pricing decisions for tour products. In this paper, we focus on a pricing problem for tour products. In particular, we will consider the pricing scheme with customer preference values on purchasing conditions. With conjoint analysis, we can use the part-worth value as a preference value for each level of purchasing conditions. To construct various discount prices, we use an enumeration method and suggest a mathematical optimization model. With experimental analysis for a sample tour package, we will show that our pricing process is very helpful for designing customer-oriented pricing decision.

• 한국신재생에너지학회:학술대회논문집
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• 2011.05a
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• pp.76.1-76.1
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• 2011

With the growing penetration of distributed generation including from renewable sources, smart grid power system is needed to address the reliability problem. One important feature of smart grid is demand response. In order to design a demand response program, it is indispensable to understand how consumer reacts upon the change of electricity price. In this paper, we construct an econometrics model to estimate the hourly price elasticity of demand. This panel model utilizes the hourly load data obtained from KEPCO for the period from year 2005 to 2009. The hourly price elasticity of demand is found to be statistically significant for all the sample under investigation. The samples used for this analysis is from the past historical data under the price structure of three different time zones for each season. The result of the analysis of this time of use pricing structure would allow the policy maker design an appropriate incentive program. This study is important in the sense that it provides a basic research information for designing future demand response programs.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.9
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• pp.51-61
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• 2020

This research investigates the consequences of the increase in corporate use of short-term debt in China over the past decades. Using a sample of Chinese firms from 2007 to 2018, we empirically explore the effect of corporate use of short-term debt for long-term investment (SFLI) on audit pricing. We first examine the relationship between SFLI and audit pricing for different groups of firms. Then, we investigate the role of the increase in short-term debt in alleviating principal-agent conflicts and reducing agency costs. We have four primary empirical findings. First, auditors tend to charge SFLI clients higher fees. Second, the negative relationship between SFLI and audit fee is found in private firms, firms audited by Chinese domestic auditors, and firms with higher information asymmetry. Third, the time auditors spent on SFLI clients is significantly more than that spent on non-SFLI clients, suggesting that the decrease in audit fee is not due to the decrease in cost. Fourth, SFLI significantly reduces the agency costs of the firm, which auditors regard as a low risk signal and grant an audit fee discount. Our findings suggest that the decrease in debt maturity, not only influences managerial behaviors, but also influences auditors' risk assessment and pricing decisions.

• Journal of Korean Institute of Industrial Engineers
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• v.13 no.2
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• pp.65-77
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• 1987

Congestion occurs whenever users interfere with each other, while competing for scarce resources. In a congested market, such as a telecommunication service market, users of telecommunication services incur costs in using the service in addition to the price. The user's own time costs involved in learning to use the service, waiting for the service, and making use of the service are typically greater than the price of telecommunication services. A market equilibrium analysis is performed in which a method for user demand aggregation is developed. The effects of price changes on user demands and market demands for congested services are examined. It is found that total market demands may increase as the price for less-congested services increase under certain demand conditions. This suggests that a nonuniform pricing scheme for a congested service may improve the utilization of the congested system. The sign of price cross-elasticity for congested services is show to vary with demand conditions. A possible complementary property of congested services is found and the implication of such a property is discussed. It is argued that such a complementary property may lead to a cross subsidy in a market with congestion. Finally, comparisons between uniform pricing and nonuniform pricing policies are made. A specific numerical example is given to show that a nonuniform pricing policy may be Pareto superior to a uniform pricing policy.

• Proceedings of the Korea Technology Innovation Society Conference
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• 2002.05b
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• pp.181-198
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• 2002

This article describes a methodology for evaluating huge aerospace R&D investments using the real options pricing method. Option pricing has been proposed as a useful approach for modeling investment in R&D. Two important features of R&D investments are that an R&D project takes time to complete and that the outcome of R&D investments is highly uncertain. This makes the analysis of R&D investments difficult. Traditional tools for project evaluation, like IRR or the NPV, are inadequate for coping with the high uncertainty. Hence, In this article I propose a log-transformed binomal lattice method, and it will show that option pricing might be an adequate framework for evaluating such types of aerospace investments.

• Communications of the Korean Mathematical Society
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• v.23 no.2
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• pp.285-294
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• 2008

A new Monte Carlo method is presented to compute the prices of barrier options on stocks. The key idea of the new method is to use an exit probability and uniformly distributed random numbers in order to efficiently estimate the first hitting time of barriers. It is numerically shown that the first hitting time error of the new Monte Carlo method decreases much faster than that of standard Monte Carlo methods.