Pricing

What is the Right Rate Design?

Fairness Is In the Eye of the Beholder

Fairness has conflicting meanings for customers, utilities, power generators, DER providers, and others. Regulators and policymakers must understand their goal should not be the perfect rate design; it doesn't exist.
Byline: 

Tanuj Deora

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The Impact of Time-of-Use Rates in Ontario

TOU Shows Tangible Results

With the mass rollout of smart meters, the idea of default TOU rates is gaining traction. This article presents the load shifting and conservation impacts of TOU rates on residential electricity use in Ontario from their inception in 2009 through to the end of 2014.
Byline: 

Neil Lessem, Ahmad Faruqui, Sanem Sergici and Dean Mountain

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Are We Paying Too Much for Residential Solar?

Many Voters Unaware of Costs

The typical solar customer in Southern California could recover their investment in seven years. After which, the facility would provide essentially free electricity for at least 18 more years. If this sounds too good to be true, it is. Those generous returns are paid for by federal taxpayers and California residential customers that lack rooftop solar.
Byline: 

By Robert Borlick

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Residential Demand Charges: Bad Choice

Time-of-Use is a Better Reform

Utilities go too far in their proposals to recover capacity costs from rooftop solar customers who self-generate. The affirmative case for Time-of-Use tariffs that reflect marginal costs is strong for all customers.
Byline: 

Charles Cicchetti

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Rethinking Rationale for Net Metering

Quantifying Subsidy from Non-Solar to Solar Customers

A thought-provoking call for fact- and principle-based policy on the controversial net metering matter. From three respected co-authors from diverse backgrounds.
Byline: 

Barbara Alexander, Ashley Brown, and Ahmad Faruqui

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Response to Cicchetti Re: Net Metering

A response to the letter by Charles Cicchetti in our April 2016 issue, which was a response to the letter by Ashley Brown in our February 2016 issue.

As Ashley Brown correctly stated in his letter, large-scale solar projects produce electricity at roughly half the cost of that produced by rooftop solar. Charlie states that customers installing rooftop solar are: “… paying to reduce dependence on greenhouse gases and to expand societal benefits ....” Not exactly.
Byline: 

Robert Borlick

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Competing Perspectives on Demand Charges

Survey of consumer advocates identifies areas of agreement and disagreement

This article summarizes perspectives on both sides of the demand charge issue. Based on this review, it proposes practical initiatives to address key concerns about residential demand charges.
Byline: 

Ryan Hledik and Ahmad Faruqui

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Response to Mitnick Re: What Consumers Want

A response to the Editor-in-Chief column by Steve Mitnick in our May 2016 issue

Unless and until we have access to economic bulk storage, substitution of carbon-free sources for fossil fuels will increase cost significantly. The cost must be borne by some combination of taxpayers and ratepayers.
Byline: 

Richard Pierce, Jr.

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Ratemaking and the Campaign Against Rooftop Solar

Rate design should balance consumer and investor interests.

Regulators should ensure that changes to rate design seek to balance consumer and utility interests. Rates that are intended to insulate utilities from economic and technological change while providing no benefits to consumers ought to be considered unjust, unreasonable, and unduly discriminatory.
Byline: 

Ari Peskoe

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Regulators Can Win the Trifecta with Residential Demand Charges

Advanced metering and demand charges give efficient and equitable price signals to customers.

The wide deployment of smart meters gives regulatory policy-makers a rare opportunity to change residential rate design. This can be done in a way that improves economic efficiency, and utility consumer and shareholder equity. Here we provide ten questions that should be asked by policy-makers, as well as some guidance in deriving the answers.
Byline: 

Ross C. Hemphill and Kenneth W. Costello

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