Modernizing Distribution Rate Design
Prepared for ATCO
This report was developed by Brattle on behalf of ATCO as part of the company’s input to Modules 2 and 3 (known as the “combined module”) of the Alberta Utilities Commission’s (AUC) Distribution Inquiry (DI).
The purpose of the report is to identify rate design options that could better accommodate customer adoption of emerging energy technologies such as smart thermostats, digitally communicative appliances, rooftop solar panels, battery storage, other forms of on-site generation, and battery-powered electric vehicles. This report is not intended to endorse one rate design solution over another. Rather, this report provides an overview of other utilities’ current or proposed rate modernization initiatives, and highlights important rate design principles for moving ahead with pricing modernization in Alberta as new energy technologies are adopted. While the examples presented in this report focus on electricity rates, the same economic concepts also largely apply to rate design for natural gas distribution.
