Customers Pay When Big Utilities Make Big Errors In Electricity Forecasts

Alden Aaberg

July 25, 2019

In an investigation of electric utility forecasts from seven of the largest ten U.S. electric utilities in the past decade, the Institute for Local Self-Reliance found that the average forecast overestimated demand by 17% over three years. Over longer time periods, the forecasts were even less accurate. The errors, all overestimating use, reinforce an environment in which utility companies––with no market competition––can win permission from public regulators to build unnecessary power plants. The costs can be passed to consumers while the rewards accrue to the utility’s shareholders.  READ MORE