Cost of Service Studies
A fundamental principle of electric utility rates is that the prices charged to consumers should reflect their utility’s cost to provide service. In addition to being a fairness issue for consumers, it is crucial for the recovery by utilities of the revenue requirements associated with providing that service.
Cost of service studies and processes for electric utilities are often seen as a “black box” to which only a select few hold the key. EnerVision has been fighting that perception for some time, working to help utilities understand the entire process so they can obtain a solid appreciation for the impact actions have on the rates paid by consumers and other aspects of utility goals and strategies.
The cost of service study is just one step in establishing rates charged to consumers, which provide price signals and often guide consumer actions. EnerVision recommends using the cost of service study as a guide for rate design, to be considered along with business objectives and programs to establish rates that enable the utility to achieve those strategic goals.
The EnerVision team brings many years of experience working with a wide range of utilities on cost of service and rates. In addition to our rates experience, we bring knowledge and experience working with utility consumers, power supply contracts, distributed energy resources, energy efficiency, demand response and other utility programs, all of which enable us to provide insights that we believe enhance the cost of service and rate development processes. Our experience enables us to develop a full understanding of the needs of the utility and its members, including flexibility to address future changes.