Distributed renewable resources and the utility business model

The recent calls for a new utility business model, to avoid a DER-induced death spiral, fail to fully understand the important role the utility business model has played in funding regulatory-driven social programs. Over the past 30 years, as new regulatory demands have been placed on the utility, the utility business model has evolved. The new DER challenge to the utility business model is basically a new form of uneconomic bypass that requires regulators to get utility pricing right, to reflect both the incremental and full cost of utility service.