On June 21, the California Public Utilities Commission announced that it would be delving into the quixotic world of retail rate design.  This incredibly important but amazingly esoteric area of utility regulation will affect just about everyone because it concerns how to split up the pie and who pays how much.  Rate design is zero-sum– if you pay less, someone else has to pay more.  So needless to say everyone — and I do mean everyone– who pays an electricity bill has an interest in this proceeding.

Just last week, the Commission assigned two different Administrative Law Judges to the proceeding (signalling its high priority and importance) and sent out an agenda related to a first public workshop on August 27 to provide some direction for the proceeding.

Among the major issues to be discussed at the preliminary workshop are:

  1. what should be the goals of retail rate design;
  2. what are the optimal rate design structures;
  3. what equity concerns are there with regard to rate design;
  4. what overlap might there be with other current proceedings that should result in some coordination

If you’re interested in tracking or participating in this proceeding, let us know!