Re-envisioning the electric distribution utility
Dr. Fredrich (Fritz) Kahrl is a director at Energy and Environmental Economics (E3). Kush Patel is a partner at E3. Dr. Ren Orans is the managing partner and founder of E3.
Progress in turning visions of the utility of the future into reality has been slow. What's missing is a more detailed vision of how future distribution utilities will plan, invest, interconnect, operate, compensate, and charge, to guide and focus discussions around the evolution of utility functions.
In a recent essay, we outlined one possible vision of the future distribution utility, or distributed utility 2.0. This vision is not intended to be normative or exclusive. Instead, it is meant to generate and focus discussion on key, how-could-it-work questions, and identify high priority areas for stakeholder dialogue.
Our vision of distributed utility 2.0 is organized around three core functions: planning and interconnection, operations and market services, and rate design. In the future, the boundaries among these three functions will become increasingly blurred, but they still offer a useful way to organize the changing roles and responsibilities for distribution utilities.
This overview focuses on transition issues.
Planning and Interconnection
Distributed utility 2.0 is an integrated planner and open access provider.