Quantitative Analysis of Utility Regulatory and Business Model Issues

The EMP Group applies the FINDER model in a range of independent research projects and in collaboration with state utility regulators and policymakers through technical assistance. Quantitative analysis includes evaluating the incremental impact of aggressive energy efficiency programs on U.S. utilities, as well as the incremental impact of increasing penetration of distributed solar photovoltaic systems on utilities and ratepayers. Applications of the FINDER model and analysis of model outputs have been used as part of technical assistance to a variety of state public utility commissions (PUCs). The model has also been used to support the State and Local Energy Efficiency Action Network (SEE Action) with analysis used in workshops and trainings.

In collaboration with Seventhwave, the EMP Group also developed the Utility Stock Analysis Tool—a utility investor valuation tool. It quantifies changes in electric utility stock prices based on different utility investment scale, risks, and returns. The EMP Group and Seventhwave have used the tool in a series of technical briefs and conference papers, exploring various potential risks to utilities and across the different underlying utility financial characteristics. The stock price modeling work has been used in state PUC proceedings on aligning utility financial motivation with DER incentives.

In addition, analytical work within many of the other EMP research areas also addresses topics related to utility regulation. These include the following:

  • Ongoing efforts to quantify the impacts of retail rate design on the customer-economics and adoption of distributed solar
  • Valuation of variable generation resources at high penetration levels
  • Assessments of utility planning practices and trends
  • Transmission planning methods and processes
  • Metrics, trends, and economic impacts of electricity reliability