Policy Brief—Designing Electric Utility Rates: Insights on Achieving Efficiency, Equity, and Environmental Goals

Frank J. Convery, Kristina Mohlin and Elisheba Spiller

Review of Environmental Economics and Policy, 2017, vol. 11, issue 1, 156-164

Abstract: Decreasing costs for distributed energy resources (DERs) such as rooftop photovoltaics and smart grid technologies are providing regulators with new opportunities to diversify and improve the reliability of electric service while increasing consumer choice, reducing pollution, and lowering total system costs. This policy brief aims to help regulators identify a path forward that takes advantage of this opportunity in order to reduce total electricity and environmental costs in ways that are both acceptable and fair. Key to capturing this opportunity is to price electricity so that it more accurately reflects both the private and social costs of its supply and delivery. We therefore urge regulators to use efficiency as a guiding principle in their rate setting in order to achieve less polluting and more equitable outcomes.

JEL-codes: D01 D63 H23 L38 L94 Q20 Q48 Q55 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (2)

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