Who Will Pay for Legacy Natural Gas Utility Costs?

UC Berkeley economics and energy researchers studied the growing “electrify everything” movement, which aims to transition utility customers from natural gas toward electricity. As regulated monopolies, natural gas utility distribution companies recover fixed costs by spreading fees across their customer base. Researchers found that utilities that lose customers historically maintain pipeline infrastructure even as the customer base financing operations shrinks. As a result, while utility overall revenues shrink, costs go up for remaining customers.

 

For details, see the published paper at https://haas.berkeley.edu/wp-content/uploads/WP317.pdf

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