Utilities focusing on efficiency, new technologies: EEI's Kuhn

Washington (Platts)--31Oct2006

With US electricity costs this winter expected to be 7% higher than last
year, electric utilities will strive to reduce demand and use new technologies
that increase efficiency at customer facilities, Thomas Kuhn, president of the
Edison Electric Institute said Tuesday.

Although power costs are rising as capped utility rates expire in some
states and utilities make investments in transmission and generation,
"electricity still remains an incredible bargain" compared with other consumer
goods that have seen costs increase faster than power, Kuhn said at a
Washington news conference sponsored by the US Energy Association.

Kuhn said a task force of utility leaders are trying to carry out the
National Action Plan on energy efficiency that was announced earlier this year
and is focusing on advanced meters and new rate structures to help foster
conservation and efficiency. "We've got to look at what's best for the
consumer," and utilities will work with state regulators to examine different
regulatory plans to foster use of new technologies, Kuhn said.

With a pressing need for new transmission investments and environmental
costs rising from coal-fired generation, "there will be many challenges in the
future" that could put upward pressure on electricity rates, Kuhn said.
Investing in new technologies will add to those challenges, he acknowledged.

For customers facing higher electricity bills, the best way to save money
is to reduce their electricity usage, Kuhn said. Some of those higher bills
stem from rate caps that are expiring as a result of retail competition and
legislative mandates, Kuhn said. Retail competition has worked in some areas
of the country and in other areas it's not worked so well, he said.

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