Searching for Equilibrium

Deck: 

How to achieve it in the era of distributed energy

Fortnightly Magazine - August 2015
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Equilibrium. It's something we often seek, but rarely achieve.

I can recall my college economics professor expounding on the laws of supply and demand - twin contending forces locked in a continual state of seeking equilibrium. I think about this notion often with regard to investor-owned utilities and their regulators. Are we in a place where these two forces are balanced, when both are able to say that their interests and needs are being met? Just like supply and demand, the circumstances for utilities and regulators change over time. Each must assess how well the relationship has adjusted to conform to present needs.

Over the decades of state regulation of distribution utilities, we have seen prominent structural changes - independent power and restructuring - that have altered the basis of the regulatory bargain. Today we stand at another critical point: where the structural underpinnings of the regulatory compact have shifted and a state of disequilibrium exists.

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