Added to that, utility revenue is likely unable to keep pace with rising peak power capacity costs, the estimated $1.5 trillion in costs to maintain and upgrade aging infrastructure, and the looming costs of costs to retire coal plants approaching end of useful life. For decades, we’ve seen a steady decoupling of GDP with growth of the grid, with primary energy consumption per dollar consistently falling. In several states, that assumption is now under fire. Regulators authorized this system under the assumption that grid directly and indirectly powers the economy, keeping rates aligned with sales. In other words: utilities build it, rate base it, and get a regulated return on it. ![]() Most investor-owned utilities create shareholder value every time they make capital investments, regardless of the value of that investment to society or in the market. The predominant utility market strategy is a result of the incumbent utility regulatory framework, leading utilities to overinvest in the grid capacity, and underutilize distributed resources. That future is likely to have less capital investment and more focus on revenue opportunities that provide connection and integration of services for customers. In an era of declining sales and explosive growth of distributed energy resources (DERs), utilities should look to other industries-from transportation to hospitality to apps to music-to figure out what a platform-based future looks like. In spite of the success of such models, most electric utilities are heading in the opposite direction and maximizing capital investment as a vehicle to maximize returns. The fastest-growing companies in America generate billions from platform business models that match suppliers directly with customers, free from the debt burden of ownership of physical assets. Bold climate action is not a burden, but a historic opportunity! We know that the transition to a low-carbon economy is essential, and is the only pathway to long-term sustainable economic growth. RMI/CWR is proud to be part of Climate Week. ![]() We live in an exciting time, when more companies and investors are committed to bold climate leadership than at any other time in history. The annual event brings together influential global figures-and new voices-from the worlds of business, government, and society who are leading the low-carbon transition. ![]() This week is the seventh Climate Week NYC.
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