Wednesday, June 17, 2015

New DOE report outlines how utilities can best manage & market time-of-use rates

There's no doubt that time-of-use rates are gaining traction, and may well be on their way to being the new utility standard. “I'd love that,” Cappers said.

SMUD has said it intends to make TOU the customer standard by 2018, about a year after California as said it may move all utilities in that direction. And earlier this year The Tennessee Valley Authority announced it is also considering changing the way it charges for power as it looks to flatten out the utility's demand curves.

And time-of-use rates, when managed well, can also result in higher customer satisfaction levels. Parks Associates last year issued a report that found homes with time-of-use rates were more satisfied with their electric service, once they made consumption adjustments.

And that last part is key, said Cappers. Utilities will need to communicate with the customers, educating them about how the new rates work and how they can manage their consumption around peak loads. “If your goal is to maximize peak load reduction, critical peak pricing is the clear winner,” Cappers said. “But there is a lot of concern from consumer advocates and regulators about bill volatility.”

From the article "New DOE report outlines how utilities can best manage & market time-of-use rates" by Robert Walton.

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