Envisioning Our Energy Future: Making It Work for Consumers and the Environment –A Strategy Retreat

On the heels of its release of UtilityVision, a framework for advancing a modern clean energy grid, Acadia Center took the next step to work through various challenges to implementation. On March 23 and 24, Acadia Center hosted Envisioning Our Energy Future: Making it Work for Consumers and the Environment—a strategy retreat at The Pocantico Center of the Rockefeller Brothers Fund* in Tarrytown, New York.  The objective was to move closer to resolving key questions regarding how the utility business model must change to achieve a clean energy future that is friendly to both consumer and the environment. The agenda was structured around two key questions:

1. What reforms are needed to maximize the utility transition to a clean, affordable distributed energy future?

2. Broad-based consumer support will be critical to achieving the reforms needed. What is needed to ensure that all consumers tangibly benefit from the future energy system?

The retreat brought together a small group of individuals who are leaders in thinking about the future of the electric power system. Attendees included representatives from utilities, clean energy businesses, academia and consulting, state energy officials, and consumer and sustainable energy voices from California, New England, and New York.
The discussions covered these three categories: a) the roles of planning and competitive markets to achieve a sustainable power grid; b) how to align utility financial incentives with public policy objectives; and c) ways to design revenue recovery to both empower consumers and provide utilities with the appropriate level of certainty. Some of the key questions discussed included the following:

• What is the utilities’ experience with using geographically-targeted energy efficiency and demand response to avoid transmission and distribution upgrades?
• What is the experience with performance incentive mechanisms, from the U.S. and United Kingdom?
• Can competitive markets deliver greater innovation and respond to consumer needs more quickly and with greater nimbleness than utilities?
• What are different ways utilities can earn the revenue required to support the advanced technological investments needed to create a market platform?
• Can the utility’s obligation-to-serve and net metering co-exist?
• Can we shift to widespread time-of-use distribution rates or demand charges while ensuring that consumers have the knowledge and tools to manage their electricity bills?

The group at The Pocantico Center of the Rockefeller Brothers Fund* came much closer to agreement than expected on key questions concerning the utility business model, the role of markets and regulation, strategic grid planning, and utility rate design and compensation for distributed generation. The next steps discussed include drafting and refining a straw proposal for grid reforms, providing lessons learned from utility pilot experiments, and possibly reconvening in the future. Acadia Center will be developing a proposal for facilitating these next steps.

*Please Note: As is the case with all materials resulting from meetings held at The Pocantico Center, the views expressed in this report are not necessarily those of the Rockefeller Brothers Fund, its trustees, or its staff.