A survey of rate case methods for sales forecasting.
Demand side management has a growing effect on energy sales. Utilities are applying five methods to account for DSM in sales forecasts. A Brattle Group survey reveals those methods and their characteristics.
Changes in regulatory requirements, market structures, and operational technologies have introduced complexities that traditional ratemaking approaches can’t address. Poorly designed rates lead to cross-subsidies, inequitable outcomes, and perverse incentives. An objective-based approach can better communicate costs to customers in a way that better serves operations and policy goals.
Philip Q Hanser is a principal with The Brattle Group. He acknowledges the contributions of Brattle colleagues Ryan Hledik and Ahmad Faruqui, as well as Ken Costello of the National Regulatory Research Institute. He also acknowledges editorial assistance from Heidi Bishop and Shannon Wentworth at Brattle. The opinions expressed in this article are Hanser’s and don’t represent those of The Brattle Group or its clients.
A purposeful approach to setting energy prices.
A new survey of energy industry experts reveals a surprising consensus on the size of the energy efficiency resource. Overall, energy efficiency is expected to lower electricity consumption by 5 to 15 percent, and natural gas consumption by 5 to 10 percent. These results debunk the notion that conservation is a fad. On the contrary, they herald a new beginning for energy efficiency.
As more natural gas is used for power generation, more volatility can be expected in gas markets. Demand response might provide a tool for managing that volatility, but is it technically feasible? And will gas customers accept it?