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The way to smooth demand, therefore, is to use price discrimination to even out the peaks and the troughs.
Economic orthodoxy looks to central bankers to smooth demand, because short-term interest rates are easier to calibrate than tax and spending and are controlled by technocrats rather than politicians.
In a consultation paper, the Government suggested "using price signals to smooth demand across the commuter peak" – raising fares at the busiest times and cutting them at quieter points in the morning and evening rush-hours.
To manage risk, government spending priorities should be energy efficiency, interconnected grids to link up different power sources across wide regions, smart grids to smooth demand and absorb volatile wind and solar power, and electric cars.
While some travellers could be rewarded for avoiding the peak times, others could pay more in order to "smooth demand" at the busiest times But the "high-peak" fare would have to be considered "very carefully", according to the wording of a rail consultation paper on fares and ticketing published today.
Smooth demand profile means less start-up times and less start-up cost.
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This smooths demand and facilitates high-throughput production".
New "shoulder" fares on the cusp of rush hour will also be tested in an attempt to smooth out demand between peak and off-peak trains.
They show that the combination of renewable generation and the integration of EVs help smooth the demand profile.
Prices are already cheaper outside of the 0700 to 1000 and 1600 to 1900 peak periods, but the idea is that pricing variations could be introduced even within those periods to "smooth" commuter demand.
"With the global recovery unlikely to be smooth, domestic demand is likely to remain the primary engine of growth in the remainder of 2009," Jing Ulrich, the chairman of China equities at Morgan Stanley, wrote in a research note.
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