Discom Business Models Require Changes to Promote Distributed Energy Resources
In this third part of our distributed energy resources (DER) in India series, we look at changes to the current distribution company (discom) business models. These models can overcome the financial disincentives DERs often face. Instead, discoms can embrace and promote DERs to improve system efficiency, increase consumer savings, and address climate change goals.
This short paper discusses the reasons the current discom model should change and how regulators should listen to concerns many discoms have when it comes to the changes associated with promoting DERs.
The paper also discusses the steps regulators can take when it comes to transforming the current discom business model, including:
- Require discoms to evaluate non-wires alternatives to meet system needs where practical and cost effective
- Require discoms to create distribution system platforms
- Require discoms to modify tariff design to send unbundled granular price signals to facilitate DERs
- Require discoms to develop DER programs
- Develop a process to effectuate changes to the discom business model
Read Part 1: Empowering Retail Customers: Improve Efficiency, Lower Costs and Reduce Emissions
Read Part 2: Facilitating Distributed Energy Resources Requires Policy Actions