In setting utility conservation goals, the Florida Public Service Commission (PSC) has decided to permit the state's electric utilities to eliminate demand-side management (DSM) programs that increase rates for nonparticipating customers. It also refused to mandate consideration of future environmental costs and other economic and societal benefits associated with DSM in utility cost/ benefit analyses.
The PSC approved the rate impact measure (RIM) methodology as the sole method of setting DSM goals, finding that program portfolios based on the broader Total Resource Cost (TRC) test would not produce significant increases in demand and energy savings. It concluded that goals based on programs that pass the TRC but not the RIM would produce rate increases and cause customers that do not participate in any DSM programs to subsidize those who do. The PSC said that increasing rates "even slightly" was not justified, but that utilities should consider implementing TRC measures on an isolated basis if rate impacts are small and savings are large. According to the PSC, programs that might fall into this category include solar water heating, photovoltaics, high-efficiency onsite cogeneration, renewable resources, end-use natural gas, and commercial lighting. It directed Florida Power & Light Co. to develop alternate funding mechanisms such as "voluntary green pricing" to promote the installation of solar water heating and other renewable measures. Re Florida Power & Light Co. et al., Docket Nos. 930548-EG et al., Oct. 25, 1994 (Fla.P.S.C.).
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