[USA] EIA report: U.S. electricity sales to increase 2.5%, average residential price to increase 6.1%

According to the Energy Information Administration’s (EIA) August Short-Term Energy Outlook, U.S. electricity consumption will increase 2.5% in 2022 compared to 2021 due to economic growth and hot summer temperatures.[1] U.S. electric sales are expected to decrease 0.3% in 2023. The EIA forecast the U.S. average residential electricity price in 2022 will increase 6.1% compared to 2021, largely driven by rising natural gas prices. Residential electricity prices will average 14.6 cents/kWh in 2022 and 14.9 cents/kWh in 2023.

Average natural gas prices fell over June and July because of additional supply in the U.s. market after the shutdown of the Freeport LNG export terminal in June. However, prices increased at the end of July because of high demand from the electric power sector. The EIA projects that LNG exports will increase to 14% in 2022 compared to 2021. Natural gas consumption is also projected to rise by 3% from 2021 to 2022. Coal consumption is expected to decrease by 1% between 2021 and 2022 and 9% between 2022 and 2023. Renewable energy sources will make up 24% of total generation in 2023, compared to 20 percent in 2021.

[1] https://www.eia.gov/outlooks/steo/

[USA] Dominion reaches tentative settlement in Virginia rate case

On October 18, 2021, Dominion Energy Virginia, the state’s largest electric utility, announced that it had reached a tentative settlement agreement in its pending base rate case with staff at the Virginia State Corporation Commission (SCC), the Office of the Attorney General, and other parties[1].[2] The SCC staff and the state attorney general had alleged that the utility had garnered nearly $1 billion in excess profits between 2017 and 2020. The allegations spurred regulators to start a rate review in March 2021 to examine Dominion’s earnings over the last four years and whether adjustments to customers' base rates are necessary.

Under the proposed agreement, Dominion’s customers will receive a total of $330 million in one-time refunds and a $50 million rate reduction. The one-time refunds would be made up of $255 million over a six-month period and $75 million over three years, which would equal a refund of about $67 for a typical residential customer. According to Dominion, the $50 million rate reduction is the maximum amount permitted by law under the 2018 Grid Transformation and Security Act and would result in a proposed monthly bill reduction of about $0.90 for each residential customer. The settlement agreement also includes the use of $309 million in revenue to offset the costs of developing the Coastal Virginia Offshore Wind pilot project, the deployment of smart meters, and a customer information platform. If approved by the SCC, Dominion would also receive a higher return for its shareholders, rising from the current 9.2% rate to a 9.35% return on equity.

[1] The settlement agreement is also joined by the Apartment and Office Building Association of Metropolitan Washington, Costco, Direct Energy, Department of the Navy on behalf of the Federal Executive Agencies, Kroger and Harris Teeter, Virginia Committee for Fair Utility Rates, and Walmart

[2] https://news.dominionenergy.com/2021-10-18-Dominion-Energy-Virginia,-State-Corporation-Commission-Staff,-Office-of-Attorney-General,-and-Other-Parties-File-Comprehensive-Rate-Settlement-Agreement-That-Provides-Significant-Customer-Benefits

[USA] Duke Energy Florida proposes plan to offset rate increases by 33%

On September 3, 2021, Duke Energy Florida announced that it had developed a plan to reduce the impact of new rates that go into effect in January 2022 by 33%.[1] Under this plan, Duke Energy Florida will spread the recovery of roughly $247 million of unrecovered fuel costs over two years and forgo immediate recovery of costs from recent storms, as well as other actions. These proposed actions would reduce a residential 1,000 kWh customer bill by an average of $4.67 per month. Under the plan, the typical residential customer's 1,000 kWh bill will increase by $9.24 per month, on average, for 2022. Commercial and industrial customer bills will increase by 1% to 8%.

The utility also recently proposed modifications to demonstrate its commitment to implementing energy efficiency and demand-side management programs. Proposed actions include increasing the Neighborhood Energy Savers targeted customers by 5% and making temporary changes to the approved Florida Energy Efficiency and Conservation Act (FEECA) programs for lower-income customers. In addition, customers enrolled in the utility's approved Residential Demand Response Program will receive a $30 "assistance incentive" in the form of a gift card that can be used toward their energy bill. Further, a second modification to FEECA programs will offer 20,000 assistance kits to provide energy efficiency savings to customers in need.

[1] https://news.duke-energy.com/releases/duke-energy-florida-seeks-to-reduce-2022-bill-impacts-by-33

［USA］ New Jersey proposes utilities recover lost revenues, earn bonuses for beating energy savings targets

On January 22, 2020, New Jersey’s Board of Public Utilities (BPU) released a proposal that would give utilities the opportunity to earn bonuses or incur penalties for beating or failing to meet energy efficiency savings targets.[1] In addition, the proposal would allow utilities to recover lost revenues related to their efforts. The cost recovery proposal follows a straw proposal released in December 2019 that outlined how utility efficiency programs will be managed and suggested implementation of new energy-saving pilots.[2] Both proposals would help implement the changes to New Jersey’s energy system the Governor Phil Murphy (D) signed in May of 2019 which boosted efficiency targets and set a 50% renewable goal by 2030.[3] In addition to addressing how utilities will approach efficiency measures, the cost recovery proposal will help address how utilities will pay for the changes under the Clean Energy Act of 2018. The 2018 law requires electric utilities to achieve annual energy use reductions of 2% or greater within five years of the new rules being implemented which imposes significant costs for utilities.

[1]https://www.bpu.state.nj.us/bpu/pdf/publicnotice/NJBPU_EE_Final_Cost_Recovery_Mechanism_Proposal_1.22.20.pdf

[2]https://www.bpu.state.nj.us/bpu/pdf/publicnotice/EE_%26_Peak_Demand_Program_Administration_Straw_Proposal_122019.pdf

[3] https://nj.gov/governor/news/news/562018/approved/20180523a_cleanEnergy.shtml

[Japan] Osaka Gas Offered a New Electricity Rate Menu “Style Plan” to Meet Customer’s Lifestyle and Individual Needs

Osaka Gas announced on August 1, 2018, that it has started offering a new electricity rate menu “style plan” that corresponds to its customers’ lifestyle and individual needs. As its first step, Osaka Gas began its “Style Plan P” service for Amazon Prime members. Osaka Gas plans to continue to diversify its rate plans by providing different types of electricity rate menus in addition to its existing base rate plan.

Osaka Gas customers that subscribe to the "Style Plan P" service can save money regardless of their electricity usage compared with the total cost of paying for both Amazon Prime’s annual fee and Kansai Electric Power Company's metered electricity “Plan A.” Based on Osaka Gas’s model, the average residential customer will save about 5,400 yen per year.

Furthermore, in April 2018 Osaka Gas began to offer some additional features to its customers in collaboration with Amazon Alexa. Customers can use Alexa’s voice services to check their gas and electricity usage amounts and fees, and can control their gas equipment through the Amazon Echo smart speaker.