| 7.6.3 Utility Programmes Within CountriesUnder some conditions, utilities--the electricity, natural gas, and thermal
  energy supply organisations--can play significant roles in market transformation.
  Public utilities are given special powers, such as limited monopolies in their
  service territories, and the right to use eminent domain to obtain easements
  for their distribution networks. In turn, they are subject to varying forms
  of regulation, including the approval of the tariff rates that they charge to
  different classes of customers. The role of utilities places them in a unique
  position to deliver energy efficiency and renewable energy programmes to their
  customers. They are a source of technical expertise in the supply and use of
  energy; are in regular contact with their customers; and are in a strategic
  position to aggregate customer demand to introduce new technologies.
 Despite these advantages, utilities historically have had a disincentive to
  encourage energy efficiency. In the past--and continuing in many jurisdictions--the
  profits earned by utilities have been based on the volume of their energy sales.
  In this regulatory climate, if a utility encourages efficiency successfully,
  its sales and earnings decline. To correct this disincentive, a number of national
  and state governments are adopting utility reforms. Regulatory programmes are
  being changed to require utilities to carry out energy efficiency programmes
  and to allow them to earn a profit on these services--the traditional demand-side
  management (DSM) model. Where utility restructuring is taking place, utilities
  are under competitive pressure to reduce costs, which has reduced their investments
  in DSM programmes. To preserve these programmes, some restructuring legislation
  is experimenting with mandatory "line" charges-surcharges on each
  kWh of electricity carried on a transmission line-to create special funds for
  DSM services, including energy efficiency and renewable energy investments and
  subsidies for low-income customers.  Among CountriesThe features that made utility DSM programmes successful--the technical expertise
  of utilities and their customer contacts--have lead to the transfer of utility
  programmes among countries. In Brazil, a comprehensive national electricity
  conservation programme, PROCEL, conducts R&D, energy audits, equipment testing
  and rating, and educational campaigns (Geller, 1997). In Thailand, a DSM programme
  has been initiated through cooperation between the utility and manufacturers.
  In China, DSM is integrated into a Sustainable Future programme. The rapidly
  increasing cross-boundary investments in utilities is increasing the potential
  of this form of technology transfer.
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