MARKETS AND PRICING FOR INTERRUPTIBLE ELECTRIC-POWER

We propose a market for interruptible, or callable, forward contracts for electric power, in which the consumer grants the power supplier th e right to interrupt a given unit of load in return for a price discou nt. The callable forward contracts are traded continuously until the t ime of use. This allows recourse for those customers with uncertain de mand, while risk-averse consumers can minimize their price risk by pur chasing early. Callable forward contracts are simple in form, and can be directly incorporated into the utility's economic dispatch procedur e.