Electricity tariffs under imperfect knowledge of participant benefits

The authors consider the problem of establishing tariffs for electrical energy under uncertainty about the value of the energy to the participants. A tariff update that achieves welfare maximization asymptotically through successive approximations to the ideal tariff is proposed. The successive update of the tariff avoids the need for accurate a priori knowledge of electricity system demand and generation as a function of price. The key results are a tariff update algorithm and a proof of local convergence, two necessary steps for implementation of practical responsive pricing