- National nonprofit Alliance to Save Energy (ASE) has formed a coalition of industry players to address rate design, and this week announced the group had agreed upon a set of principles that could reshape how customers pay for electricity.
- The group wants to drive investment in demand side management technologies, and the first principle agrees that the ability to "collect for the use of the energy grid" is essential. The Alliance hopes to develop four rate design templates by next summer.
- Utility members of the group include Exelon, National Grid, Pacific Gas & Electric, Southern Co. and Washington Gas.
As debates around the country simmer over rate design and charges to access the utility grid, ASE has brought together a group of utilities and other power sector companies to try and develop a set of guiding principles that will fairly encourage development of demand side management technologies.
“What we’re trying to do is bring all the parties to the table to come up with models for how we can meet these broader societal goals," ASE Senior Vice President Kelly Speakes-Backman said in a statement. "It’s a bit of a puzzle that people have been wrestling with for years."
Thus far the core group has agreed to a set of four principles:
- Rate designs should include the ability to collect for the use of the energy grid and to compensate customers for investments;
- Rates will ideally reflect the real-time, localized costs of service;
- Utility business models should be complementary with state energy goals and priorities;
- Rates should accurately reflect the costs and savings resulting from time and location dependent demand management.
Underlying those principles are four tenets of rate design, ASE said: technology, equity and fairness, economic efficiency and the consideration of current regulatory regimes.
"We felt it was time to bring everyone together and try to find some consensus for moving forward in today’s regulatory environment," said Speakes-Backman. "I think we have the right people at the table, at the right time, to begin to solve this puzzle.”
ASE hopes to grow the working group in the coming months. In addition to utility participants, the group also includes Ingersoll Rand, Johnson Controls, Lockheed Martin, Schneider Electric and Whirlpool.