The National Regulatory Research Institute (NRRI) was founded in 1976 by the National Association of Regulatory Utility Commissioners (NARUC). NRRI serves as a research arm to NARUC and its members, the utility regulatory commissions of the fifty states and the District of Columbia in the United States. NRRI's primary mission is to produce and disseminate relevant and applicable research related to the utility sector - natural gas, electricity, water and telecommunications
Presentations made at NRRI's Colloquium held 15-Nov-16 can be found here.
Recent Research Papers
NRRI 16-08 Multiyear Rate Plans
Regulatory experts generally agree that ratemaking should strive to achieve high economic efficiency by utilities, fairness, and reasonable regulatory costs. These three outcomes have characterized good ratemaking going back to the beginning of public utility regulation. Economic efficiency requires utilities to create or adopt new technologies, achieve excellent operating performance, and set rates that correspond to marginal cost. All of these outcomes benefit the long-term economic well-being of utility customers in addition to advancing the public interest. Fairness means that neither customers nor utility shareholders unduly shoulder risks or retain the benefits of utility activities. Fairness is essential for the public credibility of the regulatory process and regulation itself. A large part of regulatory costs are the expenses incurred by utilities and other stakeholders during the course of general rate cases.
This NRRI research paper provides an overview of community solar (CS) activities around the country. It reports on the rapid expansion of community solar projects under two different rubrics:
1. States that are implementing laws and rules that govern CS, currently underway in 15 states and the District of Columbia;* and,
2. In other states as well those above, individual utility companies are obtaining approvals from their state regulatory authorities, or for non-state-regulated utilities from their governing boards or commissions, for CS programs.
The idea that a specific carrier be designated as a carrier of last resort (COLR) is a cornerstone of utility regulation, arising both from English common law and historical state regulatory policy. Carriers of last resort have traditionally had four core obligations:
• The obligation to serve all customers within their territory, including extending facilities where necessary to provide service,
• A legal barrier to withdrawing service without the specific agreement of the state commission for local exchange service and the FCC for interstate services,
• An obligation to charge "just and reasonable prices," and
• An obligation to "exercise their calling with adequate care, skill, and honesty."
For both an industry and the general economy, technological change is a key ingredient for growth and long-term prosperity. It can spawn new products or improvement of existing products or higher efficiency of production processes. Economists generally agree that technological change is a prerequisite for economic growth.
A precursor to technological change is investments in research and development (R&D). A major purpose of R&D is to advance the current state of technology.
R&D has three distinct stages: Basic research attempts to create new knowledge that will lead ultimately to profitable commercial applications of new technologies. Applied research and development uses the new knowledge created by basic research and applies it to products or services that society values. Demonstration helps to determine the commercial feasibility (e.g. feasibility at scale) of a new technology. In other words, basic research provides the theoretical foundation for new technological innovations, while applied research, development and demonstration focuses on the feasibility of new technologies for practical and commercial applications
NRRI 16-04 Vertical Arrangements for NG Procurement.pdf
Recent interest in long-term hedging
Both electric and gas utilities purchase large amounts of natural gas as part of their business operations. Prior to the 1980s, a feature of the natural gas industry was contracts of long durations, often over 20 years at fixed prices, for both producer-pipeline transactions and pipeline-gas utility transactions.
Starting around 1985, trading arrangements within the natural gas industry became dramatically more short-term and flexible, in both price and terms and conditions, compared to prior periods. This trend occurred throughout the sector, from gas procurement, gas storage, and retail transactions to capacity contracting for pipeline services. It was a result of a more open and restructured natural gas market, among other things. This market includes buyers and sellers consummating trades with minimal transaction costs. Other developments favoring shorter-term contracts since the mid-1980s include a highly developed financial market for gas hedging and the evolution of short-term electricity markets. In fact, a major motivator of the restructuring of the U.S. natural-gas industry was the high social costs from rigid multi-year contractual arrangements as the industry transitioned to a more liberalized structure. Overall, competitive pressures have made long-term commitments a more expensive
Broadband access and adoption are key policy goals in the US and around the world. Digital connectivity is rapidly becoming the new model for universal service. The FCC, the states, service providers, and others have encouraged increase …