by Tom Foley and Bill Campbell
Utility systems have long struggled with the rate impacts and core business impacts of helping customers improve the efficiency of their energy use. In an economy that increasingly values efficient energy solutions, this new approach may hold promise.
tility rates are simple in concept. Regulators set rates so utilities can recover their costs, including operating costs and a fair and reasonable return of and on invested capital. That means the rates utility customers pay, collectively, are basically determined by this relationship: