are basically geared toward improving the reliability of the system,” Awai-Dickson said. “We want to keep up with maintenance and be proactive as opposed to reactive.”
MECO representatives say they also hope that the new rates will be the basis for a process known as decoupling – dissolving the tie between the money they make and the amount of electricity they sell. That means that instead of paying per kWh, customers would likely pay a fixed rate per month for the electricity they use. The plan, which is far from finalized, is designed to place more emphasis on fixed rates so that a decrease in usage would not drastically hurt the companies.
“Basically, there would be an established rate decided on by the Commission,” Awai-Dickson said. “This rate increase would set the base rate that we would use should the Commission decide to pursue the method of decoupling.”
The PUC is currently reviewing the idea of decoupling and the many different methods of doing it to determine if it makes sense to use for the state’s electric utilities. The hope is that with earnings detached from the amount of electricity used, the utilities will help to provide more energy-saving and efficient ways to power the state.
PUC economist Wendy Takanisha said that if the decoupling method of charging customers is approved, there would be a public education period to make sure that all ratepayers understand the new process. Currently, there is no timeframe to implement decoupling, but it would not occur until well after the PUC makes a decision on MECO’s 2010 rate increase application.