Services for the integrated, generation, transmission, distribution, or retail Utility

Some jurisdictions have public vertically integrated utilities while others have unbundled into generation, transmission, distribution, and retail.

Usually generation and retail areas have been deregulated while transmission and distribution areas are regulated.

The Regulator ensures competitive markets in generation and retail areas by establishing rules and monitoring compliance.

The Regular acts as a proxy for competition in transmission and distribution areas.
The Regulator reviews prudency of utility investments and expenditures, and provides incentives for continuous improvement in efficiency.

NextEra Insights supports utilities in maximizing profits while complying with all regulatory requirements.
We can lead or assist the utility in following areas:

Revenue requirement or phase 1

Regulated Utility is required to obtain approval of its revenue requirement every 2-3 years. This involves creating schedules of gross plant, depreciation, salvage, operating and maintenance expenses, cost of debt, income taxes, customer contributions, working capital, deferral or reserve accounts.

Rates or phase 2

Regulated Utility is required to obtain approval of rates it would charge to its customers to collect its approved revenue requirement. This involves determining functionalization, classification, services, rate classes, cost share, benefit share, allocation, economic efficiency, rate design, bill impact, and implementation.

(Integrated Resource) Planning

Planning – integrated, or generation, transmission, or distribution separately, is a multi step process involving demand and supply scenario forecasts, electrical modeling and studies, need specification, high level solution design, portfolio creation, portfolio evaluation, and preferred portfolio identification.

Need or Permit & License

Regulated Utility is required to obtain approval of its major capital investment by filing a need or permit & license application. This involves establishing the need on technical or economic basis, presenting all viable options, comparison on lifecycle cost basis, and detailed design and cost estimate for the preferred option.

Deferral account reconcilliation

Regulated Utility’s revenue requirement and rates are approved on test years i.e. forecast basis. Any variance between forecasts and actuals is disposed in deferral account reconciliation i.e. true up application. This involves obtaining Regulator’s approval of the true up methodology and then apply it to the Regulator’s satisfaction.

Regulated retail rate

Most jurisdictions with retail competition require a Utility to act as retailer of last resort by offering a regulated retail rate option to all consumers. The Regulator sets the rules on how this regulated retail rate is to be calculated, The Utility complies with these rules by filing energy price setting plan and then monthly rate.

Compliance

The Utility is subject to multitude of regulatory and legal obligations from economic regulator, environmental agency, system operator, market, industry, suppliers, and customers. The obligations are quite varied in nature – engineering, economics, planning, project management, operations, commercial, financial, or contractual.

Government relations

Government policy, legislation, regulation, direction, or program drive Regulator’s rule or decision, system Operator’s standard or tariff, Market’s design or operational rule, and stakeholder behavior. A change in any of these parameters can have significant impact on the Utility. The Utility must closely watch all such developments and participate to provide its unique perspective to the decision makers.