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Evaluating Government's Policies on Promoting Smart Metering Diffusion in Retail Electricity Markets via Agent-Based Simulation


  • *The authors acknowledge the financial support of the ESRC Electricity Policy Research Group (EPRG), under the Towards a Sustainable Energy Economy (TSEC) Programme Work Package 3 (WP3). The authors also acknowledge the comments on this paper from one anonymous referee for the EPRG and four for JPIM.

Address correspondence to: Tao Zhang, Judge Business School, University of Cambridge, Trumpington Street, Cambridge CB2 1AG, United Kingdom. E-mail:


In this paper, we develop an agent-based model of a market game in order to evaluate the effectiveness of the U.K. government's 2008–2010 policy on promoting smart metering in the U.K. retail electricity market. We break down the policy into four possible policy options. With the model, we study the impact of the four policy options on the dynamics of smart metering diffusion and suggest policy implications. The context of the paper is a practical application of agent-based simulation to the retail electricity market in the United Kingdom. The contributions of the paper are both in the areas of policymaking for the promotion of innovation diffusion in the electricity market and in methodological use of agent-based simulation for studying the impact of policies on the dynamics of innovation diffusion.