The electric industry is in a transition driven by several factors, including technology and innovation advances, ambitious policy goals, and the proliferation of renewable resources. Customers are also playing a part in the industry change as their preferences evolve, requiring new and different services from energy companies.

In a report prepared for Edison Electric Institute, Guidehouse provided a survey of alternative regulatory mechanisms that have emerged as tools to respond to evolving customer needs and expectations as technology, policy, and market conditions continue to change. 

The report breaks down the alternative mechanisms into three categories:

• Revenue adjustment mechanisms 
• Performance mechanisms 
• Other regulatory mechanisms 

According to the report, the goal of alternative regulation is to deliver customer value; maintain focus of safety, reliability, and affordability; and align the interests of all stakeholders, including customer, electric company, shareholder, and regulators.