No microecon background but I worked in an energy adjacent field for a while. One of the big issues here is that there is a huge price/cost mismatch. Consumers are billed a flat price at all times of the day and year (mostly), but the cost of producing 1 kWh of energy varies enormously throughout the day. This dynamic has always been true to some extent, but a huge increase in distributed solar generation has exacerbated this problem considerably in some places.

In most (all?) cases utilities cannot actually set their own price structures without sign off from regulators, so the onus is essentially entirely on utilities themselves to level out their costs (with storage or more flexible generation).