| |
EES Consulting staff has performed over five hundred electric, natural gas, water, wastewater and stormwater rate studies throughout the U.S. and Canada. We have earned a national reputation in these areas by assisting utilities, end use customers, associations and regulatory commissions in developing automated average embedded and marginal cost of service computer programs, and in analyzing various cost allocation structures and frameworks. EES Consulting staff has conducted numerous time differentiated average embedded and marginal cost of service rate studies. In addition, EES Consulting is at the forefront in development of unbundled cost of service studies for utilities as they move
towards offering retail access and customer choice programs.
EES Consulting's qualifications are very strong in the areas of developing retail and wholesale tariffs. This particular area of expertise is one of the areas of specialty around which EES Consulting was formed. A more detailed discussion below will demonstrate why we can make this claim.
Our approach to each project begins with the assumption that most utility problems are not simply an engineering problem or a financial/economic problem. Rather, they are complex problems, best solved by a team composed of experts in the fields of finance/rates, engineering, customer service, economics and planning. This technique of viewing a situation from several aspects has a great deal of merit. Each expert provides a unique viewpoint and perspective to the problem and to the solution. Furthermore, individuals provide input from their area of expertise and do not attempt to over-stretch their professional bounds to provide solutions.
EES Consulting's qualifications in this area center around three key areas:
- Breadth of Consulting Services
- Competitive Margin Analysis
- Teaching Experience
Breadth of Consulting Services
One of the keys to a successful consulting practice is to have a specialized practice, yet not so specialized that you lose sight of the overall objective or needs of the engagement. EES Consulting, by virtue of being a multi-disciplinary consulting firm, meets this criterion. One of the areas that EES Consulting does specialize in is the development of rates in the context of deregulation, customer choice and the unbundling of utility cost. The primary steps in the cost of service and rate design process include:
- Obtaining policy direction and detailed data
- Developing revenue requirements for the utility
- Allocating costs by performing a cost of service study
- Designing rate options for existing customers
- Determining unbundled costs and rates
While this area of expertise was one of the first developed by EES Consulting, we do not lose sight of the overall need for good utility management practices. When necessary, we can draw on the other areas of expertise that are contained in the firm. Some of these other areas of consulting services include regulatory affairs, antitrust, econometrics, economic policy review, financial planning, general management, environmental and engineering services. This diversity simply adds breadth of knowledge and expertise to all of our projects.
Competitive Margin Analysis
In a competitive world, it is important from both the customer standpoint and the utility standpoint to determine appropriate margins given different rate structures.
Individual customers have unique load characteristics. Utilities have cost structures including transportation, commodity and ancillary services. Different unbundled pricing structures provide different margins to the utility. EES Consulting has developed a methodology that provides flexibility in analyzing different rate structures. From a customer standpoint, EES Consulting has utilized the analysis to minimize margins and therefore reduce overall rates. From a utility standpoint, EES Consulting has used this type of modeling to ensure revenue stability and adequate margins for the utility.
Teaching Experience
As nationally recognized experts, the principals of EES Consulting teach a number of courses and workshops on the subject of cost of service and rate design including American Public Power Association (APPA) cost of service seminars. In addition to teaching this course, we also teach similar courses for the American Water Works Association (AWWA) and the Northwest Public Power Association (NWPPA). Members of EES Consulting have presented numerous papers before various utility groups. EES Consulting also is active in developing publications and manuals in this area of expertise. We have participated as a member of the AWWA Rates and Charges subcommittee, and assisted in the development of the AWWA M1 manual. In addition, EES Consulting has contributed to the development of a number of other APPA and NWPPA rate and financial publications.
Related Projects |
|
