New Utility Business Models in the Face of Rapid Technological Change
During this panel at the NARUC Winter Committee Meetings, Carl Linvill (RAP) will discuss how regulators can evolve distributed generation tariffs to ensure fair compensation of customer resources and grid resources as the role of distributed generation grows. Drawing on RAP’s recent paper, Designing Distributed Generation Tariffs Well, Mr. Linvill will provide 12 principles to guide regulators as they evolve their distributed generation tariffs, and will emphasize the overriding principle of fair compensation: fair compensation for all who provide power sector services, based on the value delivered for services provided, and with an eye toward ensuring that customers are neither overcharged nor undercharged for the services they receive.
In the face of rapidly changing energy resource technologies, public utility commissions face significant and fundamental challenges that call in to question traditional utility business models and ratemaking practices. At the same time utilities can achieve greater operational and business value by developing distributed energy resources, such as distributed solar PV, demand response, and energy efficiency. Collaborative and policy development amongst utilities, federal and state regulators, and policymakers, will lead to more equitable cost allocation and cost recovery, reduced operating and investment risk, and lower capital requirements.
Mr. Linvill will join Rob Caldwell, Duke Energy, and John McDonald, GE, for an engaging session on the future of utility business models. Mr. Caldwell, will discuss the role of the utility in a growing distributed generation world, including the transition from a cost recovery model based on a price per kWh. Mr. McDonald will detail the infrastructure needed for high penetrations of renewables and discuss the trends in the marketplace for smart grids development.