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How Does an Electric Utility Actually “Work”?

Two “Types” of Electric Utilities

Generally speaking, until a relatively short time ago, virtually all electric utilities were structured to operate in a similar way. This utility operational structure is characterized by having all three main functions associated with electricity production and delivery all “under the same roof” of a single electric utility company. These three main functions are: (i) the generation or procurement of electricity (the operation of the utility’s own electric generating units/power plants and/or the purchase of power from other entities’ power plants); (ii) the transmission of bulk quantities of electricity from these power plants throughout the utility’s service ...

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