Responding to EPAct 2005: Looking at Smart Meters for Electricity, Time-Based Rate Structures, and Net Metering
31 May 2006
By Dr. Kenneth Gordon and Amparo D. Nieto, et al.
The Energy Policy Act of 2005 (EPAct 2005) renews and expands the federal government's practice of requiring state regulators to take a fresh look at certain ratemaking issues. In this report for the Edison Electric Institute, NERA presents the policy issues that EPAct requires each state to consider when deciding whether to adopt the "smart meter" and "net metering" PURPA ratemaking standards. Smart meters area means toward an end -- the benefits to customers that time-based pricing can provide. Dr. Gordon and his co-authors discuss the economic principles for introducing time-of-use pricing, critical peak pricing, real-time-pricing, and net metering and examine questions that will need to be considered in response to EPAct 2005. They also review the business case for the adoption of smart meters and the specific standards that the states are to evaluate pursuant to the recent PURPA amendments.
