Electric utility and industrial users - a new partnership
Market forces, technological innovation and changes in political winds are affecting the electric industry in a big way. Regulatory agencies were created to protect customers in a monopolistic environment by functioning as a surrogate for the competitive environment. To ensure that the customers are charged a fair rate, and a company receives adequate recovery of its expenses to remain financially healthy and satisfy its shareholders, the regulatory agencies are working very hard to determine an appropriate balance during a rate case hearing. Now the landscape is changing at an accelerated pace. Tight fisted regulators throughout the country are hammering on the electric utilities, and have lowered the industry`s return on equity from 13.8% in 1984 to under 10% in 1994. A few decades ago, the industrial customer had no choice but to buy its electricity from the local utility. Self generation power plants are becoming more common and cost effective. Cogeneration is a much more efficient use of thermal energy. Many process industrial plants are employing cogeneration by conversion of thermal energy into electricity and steam at 50 to 60% efficiency whereas the efficiency of electricity produced by a fossil power plant, transformation into high voltage, transmission over miles of power lines, then transforming to a lower voltage at an industrial production facility is about 25%, as reported by Electric Power Research Institute (EPRI). Thus, whether the utilities want them or not, energy options will be increasing for industrial customers. Utilities are learning what industrial sectors learned during the last 15-20 years, as value demanding customers have changed most consumer industrial manufacturers. Where product choice is involved, price becomes a major consideration.
- OSTI ID:
- 54779
- Report Number(s):
- CONF-941218-; TRN: 95:003625-0088
- Resource Relation:
- Conference: 17. world energy engineering congress and the 4th environmental technology congress and expo, Atlanta, GA (United States), 7-9 Dec 1994; Other Information: PBD: 1995; Related Information: Is Part Of Competitive energy management and environmental technologies: Proceedings; PB: 640 p.
- Country of Publication:
- United States
- Language:
- English
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