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rate design

Recently, there has been a sharp increase in the number of utilities proposing to increase mandatory monthly fixed charges for electricity. Utilities prefer fixed charges over usage charges, because fixed charges ensure a set amount of revenue each month, regardless of sales. However, higher fixed charges are an inequitable and inefficient means to address utility revenue concerns: they reduce customer control, disproportionately impact low-usage and low-income customers, dilute incentives for energy efficiency and distributed generation, and increase electric system costs.