lost revenue Archives - Michaels Energy

Jun 29

Lost Revenue Adjustment; One Patch in the Quilt

By Jeff Ihnen Energy Efficiency, Energy Rant One Comment

This week, I dive into something I have wanted to know more about for some time: efficiency program funding mechanisms. This post is based on a recent paper released by ACEEE, Valuing Efficiency: A Review of Lost Revenue Adjustment Mechanisms. Utilities must be allowed to make enough money to draw required investor capital, debt and equity, to fund their operations. Energy efficiency programs are funded by ratepayers, one way or another – not out of shareholder charity. All states with programs have some sort of transparent, although usually incomprehensibly confusing, means for cost recovery or lost revenue recovery. Although the ACEEE…

Jan 26

Love0

Performance Incentives for Energy Efficiency Programs; Crazy with the Cheese Whiz

By Jeff Ihnen Energy Efficiency, Energy Rant, Utility Stuff No Comments

This report from The Edison Foundation / Institute for Electric Innovation forms the foundation of this week’s Rant. It includes a summary of utility cost recovery mechanisms, which to this nerd, is an interesting topic. Performance incentives are of particular interest. Why do utilities run programs anyway? Typically because they have to, either because they are required to exploit lowest-cost resources, or they are assigned goals through a process, the description of which is beyond the scope of this post. For business, however, smart utilities know when their customers use energy efficiently. It is good for the customer, and what…