Least Cost Planning in the Utility Sector: Progress and Challenges

This study reviews recent progress in least-cost planning throughout the US and identifies the need for additional work in relevant areas. Although this study was commissioned by DOE to help develop DOE funding priorities, the recommendations presented here go far beyond what DOE's budget can afford. We hope that utilities, their research institutes, and other organizations will use this report in setting their priorities for future work on least-cost planning. Based on the detailed assessments presented in this report, we suggest several foci for long-term LCUP efforts nationwide. Because current rate-of-return regulation rewards utilities for increasing short-term sales, perhaps the most important of these topics is the development of financial incentives for utilities (and their shareholders) to implement least-cost plans. 49 refs., 4 figs., 3 tabs.