Not so Fast: Why the Electric Industry May be Heading in the Wrong Direction
Kenneth W. Costello is a principal researcher at the National Regulatory Research Institute. His e-mail address is firstname.lastname@example.org.
Call me a killjoy, or call me a realist, but either way, please allow me to have my say. To all policymakers out there, I urge you: "Not so fast." Exercise caution in taking major actions today. There is just too much uncertainty. Let's return to fundamentals and first principles until we better understand the future direction of the electric industry.
Some would presume, for example, that distributed generation (DG) will dominate the retail market before long. Yet I would ask: Why invest millions of dollars today conditioned on a future that remains in doubt? Inescapable error results when we view the future with absolute certainty. Incongruities insert themselves between policies and actual conditions. Decisions that bank on the sureness of the future invite regrettable outcomes. In the extreme, that's what we economists call "unintended consequences."
Instead, steer clear of the pretense of knowledge. Do more to question whether popular actions will serve the public good. And here I'm addressing not only utility regulators, both state and federal, but also other state and federal governmental entities such as EPA and state energy offices.