Locked in flat tariffs? Energy retailers struggle in attracting customers to demand response through dynamic pricing

Matching electricity supply and demand is of key importance for the deployment of renewable energy sources. Tools such as dynamic and real-time pricing are useful in engaging energy end-users in this effort and enabling demand response. Moving away from a predominant focus on the technical aspects of demand response, in this article we explore the role of dynamic pricing in contributing to energy democracy and making electricity provision less inconspicuous. To this end, we examine the market offers of 59 Finnish electricity retailers including their customer segmentation and understandings of the barriers to broader uptake of dynamic pricing. Our findings indicate that markets are in ferment, electricity retailers are indeed innovating and trialing new electricity products, but there are also major concerns about vulnerable energy end-users. We also find evidence that a move towards more dynamic pricing is not a general trend. On the contrary, electricity retailers have diverse portfolios including novel products such as ‘super-flat’ tariffs, in which prices are detached from both the timing and the volume of consumption. Dynamic pricing and transparency in energy balancing can be an important constituent of energy democracy. However, current market offerings are not organised and not developing in ways that would be conductive to a wide utilization of these demand response tools among domestic end-users of electricity.