As the United States’ power grid becomes more sophisticated, electricity rates will need to rise to reflect periods of intense energy use and to encourage consumers to change their electricity habits, U.S. Energy Secretary Steven Chu said on Monday.
Chu said currently most local electricity rate commissions view themselves as consumer advocates and try to keep electricity prices as low as possible.
“Hopefully that will evolve somewhat, so that they begin to fold in some of the real costs of electricity generation and electricity use,” Chu said at conference focused on creating a “smart grid.”
For instance, on hot summer days when air conditioning use is high, utilities would charge customers more for electricity. Chu said those who set rates should be more lenient with electricity generated from cleaner sources such as wind or nuclear power.