Time to "Decouple" Dominion

In a bid to cut energy use, Maryland yesterday became just the fourth state in the nation to approve a plan that removes the incentive for electric utilities to sell more power in order to make more money.

In a rate case ruling issued yesterday, the Maryland Public Service Commission endorsed an approach known as decoupling, which ensures that utilities do not lose revenue if customers use less electricity.

Currently, in Virginia and many other states, power companies make more money if they sell more power.  Thus, their incentive is to generate as much electricity as possible, as cheaply as possible, regardless of the environmental consequences. 

In contrast, "decoupling" separates the utility company's revenue from its power sales.  This changes the incentive structure in an important way, encouraging the company to promote energy efficiency instead of discouraging it.  According to the Washington Post article, "California is the only state where decoupling has been in effect for years, and energy experts say that it is one reason why the state uses less electricity per person than any other state."

Let me reiterate: California uses "less electricity per person than any other state," and that's in large part due to decoupling.  It's time to do that here in Virginia with Dominion Power and other utilities.  I would recommend going even further, tweaking the rate structure so that Dominion power actually makes LESS money if they sell more power, and MORE more if they promote energy efficiency and conservation.  Of course, there's almost no chance that the current, Republican-controlled General Assembly would ever pass such a measure.  That's just one more reason we all need to vote Democratic this November, to help "decouple" Dominion.

Comments