Comparing the Three Types of Electric Utilities
*2018 CREA Directory
Investor-owned electric utilities are privately owned and have the fundamental objective of producing a return for their investors. They either distribute profits to stockholders as dividends or reinvest the profits. Most investor-owned electric utilities are operating companies that provide basic services for the generation, transmission and distribution of electricity.
Publicly owned electric utilities are not-for-profit local government agencies established to provide service to their communities and nearby consumers at cost, returning excess funds to consumers in the form of community contributions, increased economies and efficiencies in operations, and reduced rates.
Electric energy is the amount of work that can be done by electricity. The unit of measure for electric energy is a watt-hour. Electric energy is measured over a period of time and has a time dimension as well as an energy dimension. The amount of electric energy produced or used during a specified period of time by a piece of electrical equipment is referred to as generation or consumption.
Electric power is the rate at which electricity does work—measured at a point in time, that is, with no time dimension. The unit of measure for electric power is a watt. The maximum amount of electric power that a piece of electrical equipment can accommodate is the capacity or capability of that equipment.