Final answer:
The electric rate business model must evolve to accommodate new technologies, manage higher energy demands, integrate sustainable sources like solar energy, and anticipate higher infrastructure costs due to the lack of economies of scale. Strategies must be developed to ensure the energy landscape can sustainably meet constant demands, considering factors like battery cost and the reliance on coal and nuclear sources.
Step-by-step explanation:
The question concerns how the electric rate business model must change in light of evolving energy demands and sources. With increased adoption of technologies like electric vehicles (EVs), residential areas may face challenges coping with spikes in electricity demand during popular charging times. Innovations and changes in infrastructure, such as the integration of solar energy for night-time charging, could help manage this load. However, several factors, including the preference for dual-system cars for long-range travel, concerns over the cost of battery decline and replacement, and the desire to minimize reliance on coal and nuclear sources, are pushing for a significant shift in the business model. Firms would face higher costs due to the loss of economies of scale if forced to build their own power lines, leading to higher prices. Moreover, shorter patent protections could dampen innovation, affecting the development of new technologies. The industry must also consider potential solutions like renewable energy sources to meet constant demands effectively. This shift in the energy landscape requires strategic planning where cost is based on energy consumed (E = Pt), demanding precise calculation and a careful approach towards infrastructure and regulation changes.