25 October 2011: The IEA has published an information paper, entitled “Empowering Customer Choice in Electricity Markets,” which stresses the importance of broadening energy choice for realizing environmental and economic improvements in electricity systems.

Authored by Douglas Cooke, the paper begins with the presumption that a broad array of customer choices is necessary for any well-functioning market, something which is lacking in the context of energy in many contexts. It focuses on the idea of demand response, which refers to customer willingness to change behavior in response to shifts in prices or other incentives. In the European and North American contexts, the paper suggests that yet untapped demand response measures could potentially reduce peak energy demand by 15-20%. Cooke notes, however, that a number of barriers currently prevent this potential savings from being realized. These include: insufficient exposure to real‐time prices; under‐developed electricity retail markets and products; insufficient development of products to inform effective customer choice; inability to monitor, verify and guarantee responses in real time; expensive and poorly integrated administrative processes that discourage effective retail competition, switching, and customer choice; under‐developed legal and regulatory frameworks, especially relating to standards governing metering; and regulatory requirements and rules that unduly control prices and restrict customer choice. [IEA Press Release][Publication: Empowering Customer Choice in Electricity Markets]