A Triple Bottom Line for Electric Utility Regulation : Aligning State-Level Energy, Environmental, and Consumer Protection Goals

Energy infrastructure across the United States is aging, and a combination of new and impending environmental requirements and inexpensive natural gas are speeding plant retirements. Utilities and regulators will have to decide how to update or replace aging facilities — estimated at a cost of $1.5 to $2 trillion over the next twenty years. These decisions will affect consumer prices and environmental outcomes for decades. For these reasons, considering the direct link between consumer prices and environmental protection is an important element of maintaining affordable and reliable electricity. While states seek to provide citizens with affordable electricity, reliable electricity, and a healthy environment, they commonly delegate portions of these interrelated goals to multiple state agencies with very different mandates. Aligning state policy goals can help keep the lights on and electricity prices low while also protecting public health and the environment. To that end, this paper explores the opportunities and challenges to aligning state energy, environmental, and consumer protection goals and proposes a “triple bottom line” (TBL) approach to state utility regulation. The TBL approach for electric utility regulation proposed here aims to harmonize existing state policy goals of ensuring (1) affordable electricity, (2) reliable electricity, and (3) protection of public health and the environment. Specifically, it allows state officials from various regulatory entities to consider how their roles affect all three TBL pillars, encouraging interagency communication, informed decision-making, and better coordination