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To: Kaslin

I do not agree at all with APS political tactics.

However, I do understand some things about electric power generation operations in general and their economics; at least I think I do.

If someone reduces how much electricity they are using, does the utility “slow”, “lower” how much electricity a power plant is generating? No. Its not that simple.

The power generators are not going to run less or more by what you take. They operate and produce at maximum efficiency and from it customers take what they need from the load delivered. What the customers do not take is still there in the load delivered, just not used. The usage itself did not change the cost of operations of the generators or the grid equipment. If lower usage becomes a trend by which demand for building new generators is less, that lowers costs for new equipment ONLY, it does not change the costs of running existing equipment and the need for the utility to get consumers to take all they can from what the generators are putting out. When they can’t, rates go up in spite of less consumption, because less consumption does not in general lower power generation operating costs.

So, IN GENERAL lowering your usage does not, in general, lower the operating costs of a local power grid utility, but it is assumed it ought to lower your bill. It might, and then again I am way more efficient in electric consumption than five years ago, but my bill is higher, not lower. It is not rare to see the local utility asking the public utility commission for a rate increase - arguing that their operating costs are not lower even though consumption is down, and consequently their revenue per unit of energy generated, their ROI, & their profit is down.

Some public utility authorities are rewarding electric companies for the good behavior of helping customers reduce consumption, become more efficient, or augment their electric needs with “alternate” sources. What are the rewards to the electric company? More positive answers to a rate increase.

It is going to be a difficult transition from a grid energy paradigm to an independent energy paradigm. Greater efficiency comes at a cost and we all are going to pay for it, in one form or another. It is a transition I believe technology is pointing to. However, working out the economics of it are not as simple or clear as the technology.


6 posted on 07/28/2014 9:20:47 AM PDT by Wuli
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To: Wuli

“Some public utility authorities are rewarding electric companies for the good behavior of helping customers reduce consumption, become more efficient, or augment their electric needs with “alternate” sources. What are the rewards to the electric company? More positive answers to a rate increase.”

Our “public utility” (PG&E) has been trying to get people to conserve and then when their load drops, they ask for rate increases to cover their “fixed costs,” a big chunk of which is gold balls pension and health care benefits that continue for people who should be let go as excess to need. Ditto for public districts like sewers. Our sewer district has asked for a rate increase and they state right in the application that some of the money is destined for “employee benefits.”


8 posted on 07/28/2014 10:21:53 AM PDT by vette6387
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