The document summarizes the results of a survey of over 400 US electric utility executives about the state of the electric utility industry. Key findings include:
- Utilities see their biggest growth opportunities as distributed energy resources, customer relationships, and transmission.
- Their biggest challenges are aging infrastructure, an aging workforce, and outdated regulatory models.
- Most utilities are seeing minimal, stagnant, or negative load growth and there is no consensus on how to address this issue.
This document discusses the transformation of transmission and distribution operating models in the electric utility industry through leveraging smart grid technologies. Key drivers include aging infrastructure, climate change concerns, evolving regulations, and changing customer expectations around reliability, pricing and conservation. The opportunity lies in embracing new approaches to demand management and market efficiency to modernize grids and business models for a sustainable future. Success will require a strategic roadmap and realizing the associated business case for transformation.
2015 Altran Battery Storage White PaperPhilip Clark
The document discusses energy storage and its potential to transform the power and utilities markets. It provides an overview of the state of the electric industry, describing factors influencing the grid like renewable energy deployment and distributed generation. It then outlines various energy storage services and benefits, including providing bulk energy and ancillary grid services. Applications of energy storage systems are explored for both transmission and distribution infrastructure support.
Market deregulation and competition in the Texas energy market has driven innovation and investment to meet growing demand. Competition incentivizes private investors to fund new power generation using efficient technologies like natural gas, clean coal, solar and wind. Since deregulation began in 1999, over $5.8 billion has been invested in transmission grid upgrades and 36 gigawatts of new generation capacity was added from 1998 to 2008. Deregulation gives consumers choices in providers and plans to better meet their needs.
In many ways, the electricity industry makes an unlikely candidate for disruption. Not much changed between the 1880s, when Thomas Edison began building power stations, and the start of the 21st century. Top business leaders rarely had to think about electricity. They got their electricity from the power plant, or the local utility, or the government, and had little say in how it was produced, delivered, or managed. Utility executives, for their part, could make and execute long-term plans with a great deal of security. Demand tended to rise along with the economy; natural monopolies were the norm.
No longer. Several coincident, significant transformations are causing a revolution in the way electricity — the vital fuel of global commerce and human comfort — is produced, distributed, stored, and marketed. A top-down, centralized system is devolving into one that is much more distributed and interactive. The mix of generation is shifting from high carbon to lower carbon, and, often, to no carbon. In many regions, the electricity business is transforming from a monopoly to a highly competitive arena.
“We are witnessing considerable disruption in the power sector arising from a combination of policy, technological and customer change. It’s creating a transformation in how we think about, produce and use electricity.
In some parts of the world, disruption is already taking a strong hold. In other parts of the world, it is just beginning. It comes on top of the already considerable existing challenges companies face in providing energy security, affordability and sustainability.
Our survey looks at what is driving the change and where it is leading to. Therefore we talked with 73 top-level power & utility company executives from 52 countries all around the world. We include an analysis of some of the principal disruptive factors at work. Looking further ahead, we find that a big majority in our survey expect significant or very significant market model change by 2030. Most think that current business models won’t be sustainable and many think existing business models are already broken.”
- Norbert Schwieters, PwC Global Power & Utilities leader
The document discusses how promoting solar energy can create jobs and free America from foreign oil dependence. It argues that a pathway to changing the electricity mix is to focus on customer technologies like solar and energy efficiency in the short term, and central station renewables like wind and biomass in the mid-term. Political will is needed as the catalyst to drive these changes through government mandates and by converting positive public opinion into political force.
This document provides an overview of the future of US electric distribution systems over the next 20-30 years. Key trends include the transformation of the industry through distributed energy resources, grid technologies, customer energy management, and social networking. Technology advancements like energy storage, power electronics, sensors, and analytics will fundamentally change distribution system design, investments, and operations. The electric industry is at a tipping point that will require new business models, regulations, and utility roles to accommodate a more dynamic grid and empowered customers.
Revue de presse IoT / Data du 04/03/2017Romain Bochet
Bonjour, Voici la revue de presse IoT/data/energie du 4 mars 2017. Cette semaine au programme :
- The Disruption And Global Transformation Of The Energy Industry
- How ENEL is using IoT to embrace the ‘energy revolution’
- IBM, VELCO join forces to create smart energy solutions firm Utopus
- How IIoT is revolutionizing utilities
- How energy-data-as-a-service is enabling innovation
- Renewable energy IoT to hit $5.3 billion annually by 2030
A lire le court article sur ENEL.
Je suis preneur d'autres artices / sources !
Bonne lecture !
This document discusses the transformation of transmission and distribution operating models in the electric utility industry through leveraging smart grid technologies. Key drivers include aging infrastructure, climate change concerns, evolving regulations, and changing customer expectations around reliability, pricing and conservation. The opportunity lies in embracing new approaches to demand management and market efficiency to modernize grids and business models for a sustainable future. Success will require a strategic roadmap and realizing the associated business case for transformation.
2015 Altran Battery Storage White PaperPhilip Clark
The document discusses energy storage and its potential to transform the power and utilities markets. It provides an overview of the state of the electric industry, describing factors influencing the grid like renewable energy deployment and distributed generation. It then outlines various energy storage services and benefits, including providing bulk energy and ancillary grid services. Applications of energy storage systems are explored for both transmission and distribution infrastructure support.
Market deregulation and competition in the Texas energy market has driven innovation and investment to meet growing demand. Competition incentivizes private investors to fund new power generation using efficient technologies like natural gas, clean coal, solar and wind. Since deregulation began in 1999, over $5.8 billion has been invested in transmission grid upgrades and 36 gigawatts of new generation capacity was added from 1998 to 2008. Deregulation gives consumers choices in providers and plans to better meet their needs.
In many ways, the electricity industry makes an unlikely candidate for disruption. Not much changed between the 1880s, when Thomas Edison began building power stations, and the start of the 21st century. Top business leaders rarely had to think about electricity. They got their electricity from the power plant, or the local utility, or the government, and had little say in how it was produced, delivered, or managed. Utility executives, for their part, could make and execute long-term plans with a great deal of security. Demand tended to rise along with the economy; natural monopolies were the norm.
No longer. Several coincident, significant transformations are causing a revolution in the way electricity — the vital fuel of global commerce and human comfort — is produced, distributed, stored, and marketed. A top-down, centralized system is devolving into one that is much more distributed and interactive. The mix of generation is shifting from high carbon to lower carbon, and, often, to no carbon. In many regions, the electricity business is transforming from a monopoly to a highly competitive arena.
“We are witnessing considerable disruption in the power sector arising from a combination of policy, technological and customer change. It’s creating a transformation in how we think about, produce and use electricity.
In some parts of the world, disruption is already taking a strong hold. In other parts of the world, it is just beginning. It comes on top of the already considerable existing challenges companies face in providing energy security, affordability and sustainability.
Our survey looks at what is driving the change and where it is leading to. Therefore we talked with 73 top-level power & utility company executives from 52 countries all around the world. We include an analysis of some of the principal disruptive factors at work. Looking further ahead, we find that a big majority in our survey expect significant or very significant market model change by 2030. Most think that current business models won’t be sustainable and many think existing business models are already broken.”
- Norbert Schwieters, PwC Global Power & Utilities leader
The document discusses how promoting solar energy can create jobs and free America from foreign oil dependence. It argues that a pathway to changing the electricity mix is to focus on customer technologies like solar and energy efficiency in the short term, and central station renewables like wind and biomass in the mid-term. Political will is needed as the catalyst to drive these changes through government mandates and by converting positive public opinion into political force.
This document provides an overview of the future of US electric distribution systems over the next 20-30 years. Key trends include the transformation of the industry through distributed energy resources, grid technologies, customer energy management, and social networking. Technology advancements like energy storage, power electronics, sensors, and analytics will fundamentally change distribution system design, investments, and operations. The electric industry is at a tipping point that will require new business models, regulations, and utility roles to accommodate a more dynamic grid and empowered customers.
Revue de presse IoT / Data du 04/03/2017Romain Bochet
Bonjour, Voici la revue de presse IoT/data/energie du 4 mars 2017. Cette semaine au programme :
- The Disruption And Global Transformation Of The Energy Industry
- How ENEL is using IoT to embrace the ‘energy revolution’
- IBM, VELCO join forces to create smart energy solutions firm Utopus
- How IIoT is revolutionizing utilities
- How energy-data-as-a-service is enabling innovation
- Renewable energy IoT to hit $5.3 billion annually by 2030
A lire le court article sur ENEL.
Je suis preneur d'autres artices / sources !
Bonne lecture !
Steve Avary - Electricity Utility 2 point 0 PaperSteven Avary
The document discusses challenges facing electric utilities in balancing financial metrics with stakeholder objectives like conservation and renewable integration. Innovation is critical but limited by regulatory disincentives as efficiency benefits customers rather than utilities. New performance models like RIIO in the UK and the Iowa model provide incentives for outputs. Technologies like batteries and smart grids have reduced peak demand but require significant investment. Distributed generation also threatens the traditional utility model by enabling customer independence and reducing load growth. New policies are needed to absorb higher costs and share risks between utilities and customers.
This document summarizes the opportunities and challenges for municipalities taking over electric utilities from private companies. Key points include:
- An increasing number of municipalities are interested in municipalization due to concerns over climate change and power disruptions. However, it requires substantial financial investment.
- Smart grid technologies can help municipalities operate their own utilities more effectively, though currently only 5% have initiated smart grid programs.
- Community choice aggregation is an alternative model gaining traction that allows municipalities to purchase power on behalf of residents from alternative suppliers.
- Municipal utilities have advantages like lower rates, more renewable energy, and faster power restoration, but starting a new utility requires expertise private companies already have.
FUTURE RESILIENCE OF THE UK ELECTRICITY SYSTEM ARE WE RESILIENT TO MEET THE N...Peter Jones
The Energy Research Partnership (ERP) has brought together a range of stakeholders from across the energy sector to develop a common view on the future resilience of the UK Electricity System.
This work has identified a range of emerging trends that are changing the way we operate the electricity system and will need to be acted upon to assure we have a resilient electricity system in the future. In response to these trends a number of recommendations have been made that require action over the next decade to assure resilience of the electricity system in the future.
Strawman - Electric networks in Great Britain today are facing unprecedented challenge from Climate, Carbon and Convergence issues. Some thoughts and considerations.
Comments welcome
Utilities today face a host of
significant challenges. Among them
are environmental regulations;
fuel price uncertainty; and fresh
capital needs for plant upgrades,
baseload generation investments,
and transmission investments.
One of the largest disruptors,
however, may be the erosion of
the utility business model itself.
Bridge Energy Group is a consulting firm focused on the energy industry that works on smart grid projects. Traditionally, electric utilities have made bundled investments on behalf of consumers with a focus on stability and reliability. However, the electric system is economically inefficient due to peak demand driving overinvestment and reduced load factors. Dynamic pricing is the best solution to combat peak demand and maintain fairness in rates by introducing a real price signal that reflects the true cost to serve and allows customers to shift usage. The macroeconomic benefits of the smart grid include more efficient utilization of utility assets, downward pressure on electric rates, and cost savings across the economy.
The document provides an overview of the smart grid concept, including its rationale, taxonomy, benefits, financing and stimulus, initial investment areas, and implementation challenges. It discusses how a smarter grid can help balance supply and demand, integrate renewable energy, reduce costs and emissions. Key points include how $4.5B in stimulus funding will support projects improving transmission efficiency and interoperability standards are needed for large-scale adoption. Initial focus areas for investment include advanced metering infrastructure, distribution networks, pricing models, demand response, home networks, and energy storage.
This document provides an overview of the challenges facing the utilities sector in the UK. It discusses the intense political pressure over affordability and security of supply that the energy and water industries are facing. The utilities sector believes the current political climate is threatening its ability to secure necessary investment and that regulation has become more susceptible to political pressure. However, the utilities sector also recognizes opportunities to restore public trust by improving customer service, communications, and responsiveness to issues. The overview indicates the sectors will need to balance priorities of reducing carbon emissions, ensuring security of supply, and keeping prices affordable.
Navigating the Energy Transformation: Creating Customer and Shareholder Value...Guidehouse
The document discusses the accelerating transformation of the energy industry driven by technology innovation, changing regulations and policies, and evolving customer demands. It describes how the traditional centralized power grid is evolving into a "Energy Cloud" that is cleaner, more distributed, intelligent and mobile. Key trends include the growth of distributed energy resources (DER) outpacing centralized generation, and the emergence of new business models and platforms in areas like energy-as-a-service, transportation electrification, smart cities and transactive energy markets. Utilities are encouraged to evolve their roles and business models to become orchestrators of these new decentralized systems and capture opportunities in the Energy Cloud.
Jan Vrins, leader of Navigant's global energy practice, examines the state and future of the power industry, including megatrends, tipping points, future state, and the path forward.
Does Energy Deregulation Affect Your Household?Shop My Power
Regulation of the energy industry began to ensure a reliable supply of electricity but led to monopolies that raised prices. Deregulation laws passed in the 1970s introduced competition which has led to lower costs and more choice for consumers. Consumers can now choose their energy provider and have influenced companies to offer cleaner energy sources. Deregulation has given consumers both economic and personal freedom in the energy marketplace.
Clean energy solutions_for_americas_cities__uscm_siemens_globescanmssarfraz1
The document summarizes the results of a survey of 396 mayors from cities across the US on clean energy solutions. Key findings include:
- 75% of cities expect to increase deployment of clean energy technologies in the next 5 years.
- LED/efficient lighting, low-energy buildings, and solar electricity are seen as the most promising technologies.
- Financial constraints are the biggest barrier to clean energy investments.
- Energy Efficiency and Conservation Block Grants have helped fund technology deployments and are still needed.
- Partnerships, especially with the private sector and federal government, will be important to support future deployments.
Growth Opportunities For International Companies In 2010Eliot Norman
The document summarizes opportunities for international companies in 2010 stemming from funding provided by the American Recovery and Reinvestment Act of 2009 (ARRA). It discusses areas where stimulus money is being spent, including energy, transportation, and healthcare. Foreign companies are able to participate in public and private sector clean energy, infrastructure, and other projects. The document provides examples and advice on pursuing these growth opportunities.
Investigations into the lifetime of gas meter batteries in the NetherlandsMachiel Joosse
At 2020 there will be about seven million smart gas meters installed in the Netherlands, using batteries that are supposed to last for about 20 years. The long lifetime of the batteries is crucial, because an operation to replace them would be on a large scale and therefore expensive. Distribution System Operators (DSO’s) have to be able to rely on a lengthy lifetime. The Dutch DSO’s Netherlands (within Netbeheer Nederland), joined forces to carry out a unique study of the predicted and actual battery lifetime. In this study, batteries were examined from gas meters that had already been operating for 4-5 years. The results were promising: after 4-5 years: the actual (practical) lifetime of the batteries examined turned out to be in line with the predicted (theoretical) values.
All North American utilities will adopt smart metering and advanced metering infrastructure (AMI) to some degree in the near future. While some utilities will take a minimal approach, more visionary companies will use smart metering as an opportunity to positively influence their future. Most utilities favor taking the latter, more innovative approach based on programs seen throughout North America. Implementing smart metering programs presents both business strategy challenges and technology issues for utilities to navigate. Utilities that view smart metering solely as a means to improve revenue management are missing opportunities, as effective programs leverage investments to support broader benefits and market efficiency. Partnerships will be key to ensuring smart metering initiatives succeed in meeting utilities' goals.
The document discusses the adoption of smart metering and advanced metering infrastructure (AMI) by North American utilities. It states that while some utilities will take a minimal compliance-based approach, more visionary companies will see smart metering as an opportunity to positively influence their future. It outlines the benefits of smart metering programs that go beyond basic meter reading to leverage investments and benefit all electricity market participants. Key challenges include influencing consumer behavior and integrating new technology and data with legacy utility systems. Effective smart metering solutions require coordinated implementation of meters, communications systems, data management and other components. Utilities are advised to partner with experienced providers to ensure successful smart metering initiatives.
Capgemini ses - smart grid operational services - leveraging technology to ...Gord Reynolds
The document discusses the vision for transforming electric transmission and distribution (T&D) systems into "smart grids" through the use of new technologies. It outlines drivers for change such as aging infrastructure, climate change, customer expectations, and regulatory pressures. The vision is for a grid that can autonomously restore power, support distributed energy resources, provide power quality, and operate with lower costs. This will require upgrading grid hardware with sensors, analyzing collected data in real-time and non-real-time, monitoring and managing the grid, and rebuilding infrastructure to allow bi-directional power flows. The transformation is an evolution that will take years or decades to fully implement across utility service territories.
Evolving Distribution Grid article in Electric Perspectives magazine Jan-Feb 2015 edition. Article discusses emerging business opportunities for a utility Distribution Services Provider.
Steve Avary - Electricity Utility 2 point 0 PaperSteven Avary
The document discusses challenges facing electric utilities in balancing financial metrics with stakeholder objectives like conservation and renewable integration. Innovation is critical but limited by regulatory disincentives as efficiency benefits customers rather than utilities. New performance models like RIIO in the UK and the Iowa model provide incentives for outputs. Technologies like batteries and smart grids have reduced peak demand but require significant investment. Distributed generation also threatens the traditional utility model by enabling customer independence and reducing load growth. New policies are needed to absorb higher costs and share risks between utilities and customers.
This document summarizes the opportunities and challenges for municipalities taking over electric utilities from private companies. Key points include:
- An increasing number of municipalities are interested in municipalization due to concerns over climate change and power disruptions. However, it requires substantial financial investment.
- Smart grid technologies can help municipalities operate their own utilities more effectively, though currently only 5% have initiated smart grid programs.
- Community choice aggregation is an alternative model gaining traction that allows municipalities to purchase power on behalf of residents from alternative suppliers.
- Municipal utilities have advantages like lower rates, more renewable energy, and faster power restoration, but starting a new utility requires expertise private companies already have.
FUTURE RESILIENCE OF THE UK ELECTRICITY SYSTEM ARE WE RESILIENT TO MEET THE N...Peter Jones
The Energy Research Partnership (ERP) has brought together a range of stakeholders from across the energy sector to develop a common view on the future resilience of the UK Electricity System.
This work has identified a range of emerging trends that are changing the way we operate the electricity system and will need to be acted upon to assure we have a resilient electricity system in the future. In response to these trends a number of recommendations have been made that require action over the next decade to assure resilience of the electricity system in the future.
Strawman - Electric networks in Great Britain today are facing unprecedented challenge from Climate, Carbon and Convergence issues. Some thoughts and considerations.
Comments welcome
Utilities today face a host of
significant challenges. Among them
are environmental regulations;
fuel price uncertainty; and fresh
capital needs for plant upgrades,
baseload generation investments,
and transmission investments.
One of the largest disruptors,
however, may be the erosion of
the utility business model itself.
Bridge Energy Group is a consulting firm focused on the energy industry that works on smart grid projects. Traditionally, electric utilities have made bundled investments on behalf of consumers with a focus on stability and reliability. However, the electric system is economically inefficient due to peak demand driving overinvestment and reduced load factors. Dynamic pricing is the best solution to combat peak demand and maintain fairness in rates by introducing a real price signal that reflects the true cost to serve and allows customers to shift usage. The macroeconomic benefits of the smart grid include more efficient utilization of utility assets, downward pressure on electric rates, and cost savings across the economy.
The document provides an overview of the smart grid concept, including its rationale, taxonomy, benefits, financing and stimulus, initial investment areas, and implementation challenges. It discusses how a smarter grid can help balance supply and demand, integrate renewable energy, reduce costs and emissions. Key points include how $4.5B in stimulus funding will support projects improving transmission efficiency and interoperability standards are needed for large-scale adoption. Initial focus areas for investment include advanced metering infrastructure, distribution networks, pricing models, demand response, home networks, and energy storage.
This document provides an overview of the challenges facing the utilities sector in the UK. It discusses the intense political pressure over affordability and security of supply that the energy and water industries are facing. The utilities sector believes the current political climate is threatening its ability to secure necessary investment and that regulation has become more susceptible to political pressure. However, the utilities sector also recognizes opportunities to restore public trust by improving customer service, communications, and responsiveness to issues. The overview indicates the sectors will need to balance priorities of reducing carbon emissions, ensuring security of supply, and keeping prices affordable.
Navigating the Energy Transformation: Creating Customer and Shareholder Value...Guidehouse
The document discusses the accelerating transformation of the energy industry driven by technology innovation, changing regulations and policies, and evolving customer demands. It describes how the traditional centralized power grid is evolving into a "Energy Cloud" that is cleaner, more distributed, intelligent and mobile. Key trends include the growth of distributed energy resources (DER) outpacing centralized generation, and the emergence of new business models and platforms in areas like energy-as-a-service, transportation electrification, smart cities and transactive energy markets. Utilities are encouraged to evolve their roles and business models to become orchestrators of these new decentralized systems and capture opportunities in the Energy Cloud.
Jan Vrins, leader of Navigant's global energy practice, examines the state and future of the power industry, including megatrends, tipping points, future state, and the path forward.
Does Energy Deregulation Affect Your Household?Shop My Power
Regulation of the energy industry began to ensure a reliable supply of electricity but led to monopolies that raised prices. Deregulation laws passed in the 1970s introduced competition which has led to lower costs and more choice for consumers. Consumers can now choose their energy provider and have influenced companies to offer cleaner energy sources. Deregulation has given consumers both economic and personal freedom in the energy marketplace.
Clean energy solutions_for_americas_cities__uscm_siemens_globescanmssarfraz1
The document summarizes the results of a survey of 396 mayors from cities across the US on clean energy solutions. Key findings include:
- 75% of cities expect to increase deployment of clean energy technologies in the next 5 years.
- LED/efficient lighting, low-energy buildings, and solar electricity are seen as the most promising technologies.
- Financial constraints are the biggest barrier to clean energy investments.
- Energy Efficiency and Conservation Block Grants have helped fund technology deployments and are still needed.
- Partnerships, especially with the private sector and federal government, will be important to support future deployments.
Growth Opportunities For International Companies In 2010Eliot Norman
The document summarizes opportunities for international companies in 2010 stemming from funding provided by the American Recovery and Reinvestment Act of 2009 (ARRA). It discusses areas where stimulus money is being spent, including energy, transportation, and healthcare. Foreign companies are able to participate in public and private sector clean energy, infrastructure, and other projects. The document provides examples and advice on pursuing these growth opportunities.
Investigations into the lifetime of gas meter batteries in the NetherlandsMachiel Joosse
At 2020 there will be about seven million smart gas meters installed in the Netherlands, using batteries that are supposed to last for about 20 years. The long lifetime of the batteries is crucial, because an operation to replace them would be on a large scale and therefore expensive. Distribution System Operators (DSO’s) have to be able to rely on a lengthy lifetime. The Dutch DSO’s Netherlands (within Netbeheer Nederland), joined forces to carry out a unique study of the predicted and actual battery lifetime. In this study, batteries were examined from gas meters that had already been operating for 4-5 years. The results were promising: after 4-5 years: the actual (practical) lifetime of the batteries examined turned out to be in line with the predicted (theoretical) values.
All North American utilities will adopt smart metering and advanced metering infrastructure (AMI) to some degree in the near future. While some utilities will take a minimal approach, more visionary companies will use smart metering as an opportunity to positively influence their future. Most utilities favor taking the latter, more innovative approach based on programs seen throughout North America. Implementing smart metering programs presents both business strategy challenges and technology issues for utilities to navigate. Utilities that view smart metering solely as a means to improve revenue management are missing opportunities, as effective programs leverage investments to support broader benefits and market efficiency. Partnerships will be key to ensuring smart metering initiatives succeed in meeting utilities' goals.
The document discusses the adoption of smart metering and advanced metering infrastructure (AMI) by North American utilities. It states that while some utilities will take a minimal compliance-based approach, more visionary companies will see smart metering as an opportunity to positively influence their future. It outlines the benefits of smart metering programs that go beyond basic meter reading to leverage investments and benefit all electricity market participants. Key challenges include influencing consumer behavior and integrating new technology and data with legacy utility systems. Effective smart metering solutions require coordinated implementation of meters, communications systems, data management and other components. Utilities are advised to partner with experienced providers to ensure successful smart metering initiatives.
Capgemini ses - smart grid operational services - leveraging technology to ...Gord Reynolds
The document discusses the vision for transforming electric transmission and distribution (T&D) systems into "smart grids" through the use of new technologies. It outlines drivers for change such as aging infrastructure, climate change, customer expectations, and regulatory pressures. The vision is for a grid that can autonomously restore power, support distributed energy resources, provide power quality, and operate with lower costs. This will require upgrading grid hardware with sensors, analyzing collected data in real-time and non-real-time, monitoring and managing the grid, and rebuilding infrastructure to allow bi-directional power flows. The transformation is an evolution that will take years or decades to fully implement across utility service territories.
Evolving Distribution Grid article in Electric Perspectives magazine Jan-Feb 2015 edition. Article discusses emerging business opportunities for a utility Distribution Services Provider.
Utility Business Evolution & Innovation 072815Paul De Martini
This document discusses the evolution of utility business models and the electric industry as customer adoption of distributed energy resources grows. It outlines three stages of evolution for utilities and provides examples of the telecom industry transition and a hypothetical revenue transition for electric utilities. The document also presents options for future utility business models, including becoming providers of customer and distributed energy services, market enabling services, and transportation electrification. Finally, it argues that the industry will need to transition to thinking in terms of creating value through networks rather than traditional value chains.
GTM Research Senior Analyst Cory Honeyman on the State and Future of the U.S. Solar Market.
Presentation from Solar Power International, September 2015
European Utility Week - US Business Utility ModelsPaul De Martini
This document summarizes key points about changing US utility business models:
1) Policy drivers like renewable portfolio standards are spurring more distributed energy resource (DER) adoption by customers. Over 80% of the US population is under policies equivalent to the EU's 20/20/20 plan.
2) DER capacity like solar, demand response, and backup generation is projected to reach 30% of total US capacity by 2020, coming entirely from customers.
3) Increasing variable renewable generation and customer DER are changing utility operational needs and requiring more flexible resources to balance the grid.
4) Utilities will need to develop new strategies like offering differentiated energy solutions and facilitating DER markets to maintain competitive advantages
Business Unusual: Strategic Perspectives on the Utilities Consumer Marketplaceaccenture
A major transformation of utilities market is challenging traditional business and operational models. Accenture analysis of the likely demand disruption scenario points to a significant financial impact on the traditional utility model by 2025. Leading utilities are adapting to the chaining marketplace.
La XIV Encuesta Mundial del Sector Eléctrico y de Energía, elaborada por PwC, recoge las opiniones de directivos de 70 compañías de 52 países de todo el mundo (entre los que se incluye España) sobre los cambios que, en las próximas décadas, transformarán la industria y darán lugar a la aparición de nuevos modelos de negocio.
The Digitally Enabled Grid: What is the future of the utility distribution business? Mapping out a new role for electricity distribution in an era of disruption.
Capgemini ses - smart metering pov 2007 (gr)Gord Reynolds
The document discusses how utilities in North America will need to adopt smart metering and advanced metering infrastructure to some degree due to regulatory mandates. It argues that utilities should leverage smart metering as an opportunity to positively influence their business by embracing a fresh approach to managing peak demand and system security. This will require benefits that motivate consumer conservation, business cases that look beyond meter-to-cash processes, and market transparency. The document outlines the key components needed for an effective smart metering solution and argues that utilities should partner with experienced providers to ensure program success.
NEW BUSINESS MODELS & DIGITALIZATION IN THE ENERGY SECTORArjun Reghu
This paper investigates the key technologies that underpin the digitisation of energy and examines their potential impacts.
Understand the effects new technologies will have on the current energy system,
The new challenges they will pose, and the policies and regulatory measures which will assist in making them a success.
The document discusses the rise of "prosumers", who both produce and consume energy. Prosumers obtain energy from distributed generation sources like rooftop solar panels rather than large utility companies. By 2020, some utilities could lose 50% of their customer demand and revenue as more people become prosumers. New regulations are needed to account for changing energy business models and transactions as prosumers compete to sell excess energy on wholesale markets.
1312 CSIRO Future Grid Forum - Summary of 2050 ScenariosMark Paterson
The document discusses four potential scenarios for Australia's electricity system in 2050 developed by the Future Grid Forum. The scenarios are: 1) Central Control, where utilities centrally control consumer demand; 2) Rise of the Prosumer, where consumers have more choice to generate and trade electricity; 3) Leaving the Grid, where about a third of consumers fully disconnect from the grid; and 4) Renewables Thrive, where renewables and battery storage play a large role across the system. Key uncertainties around consumer choice, technology developments, and policy will influence which scenario or combination of scenarios emerges.
The document discusses the challenges facing the modern electrical grid and the opportunities presented by grid modernization. Key points:
- The grid is outdated and unable to handle rising demand, costsing the business sector over $100 billion annually in power issues.
- Grid modernization through technologies like sensors, communication integration, and advanced components can enable major improvements in reliability, capacity, and power quality while costing approximately $1 per month per household.
- Upgrading the grid could provide benefits like reduced blackouts, lower costs, integration of renewable energy, and annual savings of tens of billions of dollars.
Horizon Scan: ICT and the future of utilitiesEricsson
A new research report from Ericsson and Imperial College London examines the effects of ICT in reshaping the future of energy utilities markets.
ICT will play a fundamental role in the disruption of energy utility structures by enabling innovative methods of connection and coordination among community-based renewable energy installations.
Ubiquitous, affordable digital technologies create numerous new entry points into highly centralized and regulated energy markets, allowing both smaller entrants and consumers to seize power from established utility providers.
ICT systems, centered until now on supplying energy from just a handful of large producers, will soon need to balance supply from thousands of networked devices.
Integration of data across complex supply chains will create new opportunities for traceability, improved insurance models and reduced risk of accidents and environmental disasters.
These are some of the key transformational forces identified in the latest report in a series of horizon scans outlining the potential impacts of ICT on various industries. Based on in-depth research in collaboration with Imperial College London, the report identifies some of the major operating boundaries of current versus emerging utility industry structures and the role that digital technologies may play in crossing these thresholds.
The Economist Intelligence Unit conducted in August 2013 a global survey of 50 executives in utilities industries. The report explores how the revolution in consumer mobile communications is changing how utilities serve customers, encouraging them to become more responsive and engaged and to pursue strategies that make customers allies in more efficient and sustainable operations.
Facilitating cross-sectoral exchange of energy dataSaidh KESSACI
Energy transition is attracting many new players putting increased pressure on the grid players to access and draw insights from data that measures energy consumption and needs. Considering all the possible data-sharing architectures is important to make the system more attractive for investments and more secure for management.
One of the key challenges in building mobile networks in emerging markets is access to reliable and affordable energy. Approximately 1.6 billion people live without electricity and another billion have unreliable access, yet mobile networks are still being built in these areas. Energy costs make up a significant portion - between 15-30% - of operational expenditures for mobile networks in developing countries. This course will provide an in-depth understanding of renewable energy technologies, economics, and policies relevant for powering telecommunications networks in emerging markets. Topics will include the operating principles and cost analyses of solar, wind, geothermal, and other renewable sources.
This document provides an overview of the electric industry in Texas. It discusses the different market structures for electricity, including the competitive wholesale market in ERCOT versus regulated markets outside of ERCOT. In ERCOT, separate companies provide retail, transmission/distribution, and generation services, with wholesale and retail prices set by competitive market forces. Outside of ERCOT, a single company provides all services in each area, with retail rates set by the Public Utility Commission. The competitive wholesale market in ERCOT has brought greater efficiency through generators taking on risk to build new power plants.
Similar to Energy Transition and The State of US Utility 2015 (20)
The Big Oil Reality Check report finds that the climate pledges and plans of 8 international oil and gas companies fail to align with international agreements to phase out fossil fuels and to limit global temperature rise to 1.5ºC.
Publication May 2021
IEA publication, May 2024
Critical minerals, which are essential for a range of clean energy technologies, have risen up the policy agenda in recent years due to increasing demand, volatile price movements, supply chain bottlenecks and geopolitical concerns. The dynamic nature of the market necessitates greater transparency and reliable information to facilitate informed decision-making, as underscored by the request from Group of Seven (G7) ministers for the IEA to produce medium- and long-term outlooks for critical minerals.
The Global Critical Minerals Outlook 2024 follows the IEA’s inaugural review of the market last year. It provides a snapshot of industry developments in 2023 and early 2024 and offers medium- and long-term outlooks for the demand and supply of key energy transition minerals based on the latest technology and policy trends.
The report also assesses key risks to the reliability, sustainability and diversity of critical mineral supply chains and analyses the consequences for policy and industry stakeholders. It will be accompanied by an updated version of the Critical Minerals Data Explorer, an interactive online tool that allows users to explore the latest IEA projections.
Science Publication
Global projections of macroeconomic climate-change damages typically consider
impacts from average annual and national temperatures over long time horizons1–6
.
Here we use recent empirical fndings from more than 1,600 regions worldwide over
the past 40 years to project sub-national damages from temperature and precipitation,
including daily variability and extremes7,8
. Using an empirical approach that provides
a robust lower bound on the persistence of impacts on economic growth, we fnd that
the world economy is committed to an income reduction of 19% within the next
26 years independent of future emission choices (relative to a baseline without
climate impacts, likely range of 11–29% accounting for physical climate and empirical
uncertainty). These damages already outweigh the mitigation costs required to limit
global warming to 2 °C by sixfold over this near-term time frame and thereafter diverge
strongly dependent on emission choices. Committed damages arise predominantly
through changes in average temperature, but accounting for further climatic
components raises estimates by approximately 50% and leads to stronger regional
heterogeneity. Committed losses are projected for all regions except those at very
high latitudes, at which reductions in temperature variability bring benefts. The
largest losses are committed at lower latitudes in regions with lower cumulative
historical emissions and lower present-day income.
Science Publication: The atlas of unburnable oil for supply-side climate poli...Energy for One World
Nature Communication, Publication 2024
To limit the increase in global mean temperature to 1.5 °C, CO2 emissions must
be drastically reduced. Accordingly, approximately 97%, 81%, and 71% of
existing coal and conventional gas and oil resources, respectively, need to
remain unburned. This article develops an integrated spatial assessment
model based on estimates and locations of conventional oil resources and
socio-environmental criteria to construct a global atlas of unburnable oil. The
results show that biodiversity hotspots, richness centres of endemic species,
natural protected areas, urban areas, and the territories of Indigenous Peoples
in voluntary isolation coincide with 609 gigabarrels (Gbbl) of conventional oil
resources. Since 1524 Gbbl of conventional oil resources are required to be left
untapped in order to keep global warming under 1.5 °C, all of the above-
mentioned socio-environmentally sensitive areas can be kept entirely off-
limits to oil extraction. The model provides spatial guidelines to select
unburnable fossil fuels resources while enhancing collateral socio-
environmental benefits.
This document is a report from the Inter-agency Task Force on Financing for Development summarizing the current state of financing for sustainable development. It finds financing gaps have increased to $4 trillion annually for developing countries. Progress on reducing poverty and hunger has stalled or reversed in some cases. Many developing economies face high debt burdens, exacerbating financing challenges. The report calls for $500 billion in additional annual investments in sustainable development and climate action through measures like development bank reforms, debt relief for vulnerable countries, and international financial system reforms to better support developing countries in achieving the SDGs. It will help inform discussions at the upcoming Fourth International Conference on Financing for Development.
This report analyzes global trends in corporate sustainability policies and practices. It finds that nearly 10,000 listed companies representing $85 trillion in market capitalization disclosed sustainability information in 2022. Most large companies report greenhouse gas emissions and set reduction targets, though target baselines are often missing. The report also examines board oversight of sustainability issues, executive compensation linked to ESG metrics, corporate lobbying activities, and stakeholder engagement practices. It concludes by recommending flexibility in disclosure standards and increased assurance of sustainability reports.
European Court of Human Rights: Judgment Verein KlimaSeniorinnen Schweiz and ...Energy for One World
The European Court of Human Rights found Switzerland in violation of its obligations under the European Convention on Human Rights to protect citizens from climate change. The Court ruled that Article 8, the right to respect for private and family life, includes protection from serious adverse effects of climate change. However, it found the individual applicants did not have standing, while the applicant association representing over 2,000 older women did have standing. The Court also found Switzerland violated Article 6 by failing to properly consider the association's complaints in domestic courts. Overall, Switzerland failed to implement sufficient legislation and measures to meet its climate change targets in line with its international commitments.
Make it or Break it - Insights for achieving Product-market fit .pdfResonate Digital
This presentation was used in talks in various startup and SMB events, focusing on achieving product-market fit by prioritizing customer needs over your solution. It stresses the importance of engaging with your target audience directly. It also provides techniques for interviewing customers, leveraging Jobs To Be Done for insights, and refining product positioning and features to drive customer adoption.
Integrity in leadership builds trust by ensuring consistency between words an...Ram V Chary
Integrity in leadership builds trust by ensuring consistency between words and actions, making leaders reliable and credible. It also ensures ethical decision-making, which fosters a positive organizational culture and promotes long-term success. #RamVChary
Public Speaking Tips to Help You Be A Strong Leader.pdfPinta Partners
In the realm of effective leadership, a multitude of skills come into play, but one stands out as both crucial and challenging: public speaking.
Public speaking transcends mere eloquence; it serves as the medium through which leaders articulate their vision, inspire action, and foster engagement. For leaders, refining public speaking skills is essential, elevating their ability to influence, persuade, and lead with resolute conviction. Here are some key tips to consider: https://joellandau.com/the-public-speaking-tips-to-help-you-be-a-stronger-leader/
Ganpati Kumar Choudhary Indian Ethos PPT.pptx, The Dilemma of Green Energy Corporation
Green Energy Corporation, a leading renewable energy company, faces a dilemma: balancing profitability and sustainability. Pressure to scale rapidly has led to ethical concerns, as the company's commitment to sustainable practices is tested by the need to satisfy shareholders and maintain a competitive edge.
Comparing Stability and Sustainability in Agile SystemsRob Healy
Copy of the presentation given at XP2024 based on a research paper.
In this paper we explain wat overwork is and the physical and mental health risks associated with it.
We then explore how overwork relates to system stability and inventory.
Finally there is a call to action for Team Leads / Scrum Masters / Managers to measure and monitor excess work for individual teams.
Enriching engagement with ethical review processesstrikingabalance
New ethics review processes at the University of Bath. Presented at the 8th World Conference on Research Integrity by Filipa Vance, Head of Research Governance and Compliance at the University of Bath. June 2024, Athens
Specific ServPoints should be tailored for restaurants in all food service segments. Your ServPoints should be the centerpiece of brand delivery training (guest service) and align with your brand position and marketing initiatives, especially in high-labor-cost conditions.
408-784-7371
Foodservice Consulting + Design
Org Design is a core skill to be mastered by management for any successful org change.
Org Topologies™ in its essence is a two-dimensional space with 16 distinctive boxes - atomic organizational archetypes. That space helps you to plot your current operating model by positioning individuals, departments, and teams on the map. This will give a profound understanding of the performance of your value-creating organizational ecosystem.
Employment PracticesRegulation and Multinational CorporationsRoopaTemkar
Employment PracticesRegulation and Multinational Corporations
Strategic decision making within MNCs constrained or determined by the implementation of laws and codes of practice and by pressure from political actors. Managers in MNCs have to make choices that are shaped by gvmt. intervention and the local economy.
Energy Transition and The State of US Utility 2015
1. STATE OF THE
2015
created by:
Here’s wHat tHe utility of tHe future looks like,
according to over 400 u.s. electric utility executives.
ELECTRIC
UTILITY SURVEY RESULTS
in
In association
withshare
Utility
Bra nd St udio
2. Please note:
A disproportionate percentage of survey respondents said they
hail from Alaska or Hawaii. Somewhat surprisingly, their results
were not materially different from the mainland.
18%
17%
6%
14%
8%
8%
6%
8%
9%
6%
Where is your utility’s
service territory located?
Pacific West 18%
Mountain West 6%
West North Central 6%
East North Central 14%
West South Central 8%
East South Central 8%
Mid-Atlantic 8%
South Atlantic 6%
New England 9%
Non-contiguous States 17%
Every electric utility and its service territory is different,
so we asked those surveyed to provide information
about the type of utility they work for and the region
in which they operate.
Investor-Owned
Utility
Municipal
Utility
Public Power
Agency
Electric
Cooperative
What type of utility do you work for?
57%
18%
13%
12%
DEMOGRAPHICS
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 2
3. KEY FINDINGS
• Utilities will move away from the traditional vertically integrated utility model towards a more distributed,
service-based model.
• The industry’s three biggest growth opportunities are distributed energy resources, the customer rela-
tionship, and transmission.
• The industry’s three most pressing challenges are old infrastructure, the aging workforce, and the current
regulatory model.
• The vast majority of utilities are seeing minimal, stagnant or even negative load growth in their service
territories. The industry is undecided on how to best address the issue of depressed electricity sales
growth.
• Utilities plan to use more natural gas, solar, wind, distributed energy resources, and energy efficiency
over the next 20 years. Meanwhile, the industry expects to use significantly less coal and oil.
• Utilities see a big opportunity in distributed energy resources, but are unsure of the best business models.
The results of the survey make one conclusion clear: Utilities want to adapt to the changing times. What’s
not clear yet is how.
In 2015, the U.S. electric utility is in a state of transition.
Traditional cost-of-service utility regulation was set
up in the early 20th century to provide America with
universal access to electricity. But the traditional way
of doing business may no longer work in 2015 and
beyond.
Emergingtechnologies,shiftingcustomerexpectations,
and new energy economics are causing the industry
to rethink the business and regulatory models that
have served them for over 100 years.
To better understand how utilities view their present
and future, Utility Dive surveyed 433 U.S. electric
utility executives on the state of the electric utility
going into 2015. The result is our second annual “State
of the Electric Utility” report, sponsored by Siemens.
EXECUTIVE SUMMARY
The results of the survey
make one conclusion
clear: Utilities want to
adapt to the changing
times. What’s not clear
yet is how.
KEY FINDINGS
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 3
4. What does your utility see as its biggest growth opportunity
over the next five years?
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Centralized
generation
Transmission
Distribution
Internet of Things
Consolidation
Other
The customer
relationship
Distributed energy
resources 31%
23%
8%
5%
4%
7%
9%
14%
With the rapid proliferation of distributed energy re-
sources comes the need for utilities to better under-
stand and engage with their customers. For the first
time, new competitors such as rooftop solar compa-
nies are threatening to disintermediate ratepayers
from the utility. It’s not surprising that utilities view the
customer relationship as another big opportunity.
The opposite of distributed energy — centralized
generation — seems to offer little promise of future
revenue to utilities. Once a profit center, central station
power is viewed by only 8% of utilities as their biggest
U
tility executives are confident in the industry’s
growth,buttheyalsoexpecttoseenewmodels
and approaches.
Long seen as a threat, distributed energy resources
may well become the biggest driver of industry growth,
according to the executives we surveyed. While we
hear frequent grumblings about the so-called “death
spiral,” utilities view distributed energy as a massive
opportunity.
STATE OF THE
ELECTRIC UTILITY
A survey of over 400 U.S. electric utility executives reveals an industry that wants
to overcome old challenges and seize new opportunities.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 4
5. 70%
30%
CONFIDENT
NOT CONFIDENT
Q. What best describes your feelings about
the future growth of the U.S. electric utility industry?
grid backbone to help meet policy goals for renewables
and distributed energy resources. Utilities then get
paid for achieving the goals, many related to saving
energy and incorporating cleaner resources.
Moving from one profit center to another is not easy
for utilities since they must justify investments to
regulators. If utilities leave the centralized generation
business behind to provide customers with services
like distributed solar and energy efficiency, regulators
must enable them to adopt new business models.
That’s beginning to happen in certain areas of the
country, which may be part of why many utilities now
see distributed energy as a significant growth oppor-
tunity. New York regulators are contemplating radical
changes through the Reforming the Energy Vision
(REV) proceeding, which would create a marketplace
for the buying and selling of distributed energy.
growth opportunity. Those utilities least interested in
centralized generation tend to do business in the
deregulated regions of the country where regulated
utilities cannot own power plants.
One traditional profit center remains a constant for
utilities: transmission. Stringing wire is a utility exper-
tise and comes with a federal guaranteed rate of
return. Demand for transmission has heightened in
recent years for several reasons: the need to improve
reliability, replace old lines, connect wind and solar
farms to the grid, accommodate fluctuations in pop-
ulation, and access less expensive energy resources.
Many utilities are contemplating how they can fold
these varied opportunities into a coordinated business
strategy. National Grid’s Connect21 strategy is one
such example: It proposes that utilities build a resilient
If utilities abandon traditional
utility profit centers of the past,
regulators must enable them
to adopt new business models.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 5
6. Q. What are the three most pressing challenges for your utility?
The third most pressing worry for utilities is another
problem of age. The industry’s regulatory models are
out of date, according to utility executives. State
policies and regulations were designed for a system
where utility revenue stems from electricity sales, not
energy savings. Utilities think it’s time to shed some
of these old rules.
The U.S. electric utility industry cannot seize its
greatest opportunities without solving its biggest
problems.
Distributed energy cannot be a profit center without
the modernized grid infrastructure that’s needed for
grid integration. Energy efficiency cannot be a utility
business model without a new regulatory model.
Utilities face myriad challenges in 2015. The most
pressing challenge for utilities is aging infrastructure.
Today’s grid may not be up to the task of reliably in-
tegrating high levels of renewables, distributed energy
resources, and smart grid technologies. The American
Society of Civil Engineers gave U.S. energy infrastruc-
ture a barely passing grade of D+ in 2013. Utility-scale
renewables, most of all, demand sophisticated grid
management to accommodate for their variability in
production.
But it is not just the aging of infrastructure that worries
utilities. The aging of the utility workforce is their
second most pressing concern, according to the
survey results. The numbers — those entering the
industry and those retiring — aren’t balancing out.
Workers do not gain the ability to make correct blink-
of-an-eye operating decisions without years of expe-
rience.
CHALLENGES
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 6
7. Q. What are the top three emerging technologies that you think your utility
should invest more in?
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Energy Storage
Carbon capture and storage
Natural gas peaking power plants
Demand response
Energy efficiency
Utility-scale renewables
Electric vehicle infrastructure
Distributed solar
Environmental upgrades
Microgrids
Coal gasification
Other
53%
41%
8%
8%
3%
18%
37%
24%
32%
27%
13%
37%
when it was only required to procure 50 megawatts.
Meanwhile, a Texas utility is thinking even bigger —
Oncor has floated the idea of adding 5,000 megawatts
of storage to the grid in the coming years.
The sudden interest in storage stems from the tech-
nology’s renewed value proposition. Battery prices
are dropping fast and are likely to fall further as massive
manufacturing facilities, such as Tesla’s wildly ambitious
Gigafactory, drive prices down through economies
of scale.
As new technologies transform the utility business,
where should utilities invest their capital?
The utility executives we asked were clear about one
thing: Put money on energy storage.
Recent activity in the storage sector backs this up.
Utilities showed interest in storage technology at the
gigawatt-scale for the first time in 2014. California’s
ambitious mandate requiring the state’s big three
investor-owned utilities to procure 1,325 megawatts
of storage by 2020 essentially jump-started the
utility-scale storage market. Southern California Edison,
for example, selected a whopping 261 megawatts of
storage through a competitive solicitation late in 2014
EMERGING
TECHNOLOGIES
The utility executives
we asked were
clear about one thing:
bet on energy storage.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 7
8. Utility executives were nearly as enthusiastic about
clean energy. After energy storage, utilities identified
energy efficiency, utility-scale renewables and demand
response as technologies they should invest more
in.
Natural gas peaking power plants took a back seat
on the utility industry’s priority list. Given the abundance
and low price of natural gas, this is somewhat sur-
prising. Perhaps this is because the industry is already
investing in natural gas and utilities are concerned
about an overreliance on the fuel, which had disastrous
consequences for the industry during the polar vortex
in 2014.
Coal gasification, carbon capture and storage, and
environmental upgrades are not seen as promising
investments. Very few utility executives think their
utilities should invest more in those technologies.
Little hope exists for carbon capture and storage in
the near term, while “clean coal” demonstration
projects have proven hard to finance, except in narrow
applications where the carbon has an industrial use,
such as enhanced oil recovery.
The results reveal that utilities are betting against old
technologies and see opportunity in innovation. That’s
the first step towards the grid of the future. But how
will utilities build new business models to take ad-
vantage of these opportunities? No utility seems to
have fully figured it out yet. Expect the question to
preoccupy utilities and state regulators in the coming
years.
Utilities see opportunity in new
technologies, but there is no
proven model yet for
investment and cost recovery.
Very few utility
executives think
their utility should be
investing further in coal
gasification, carbon
capture and storage,
and environmental
upgrades.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 8
9. Q. If you were able to choose, which regulatory
model would you prefer for your utility?
56%
44%
PERFORMANCE
BASED-RATE-
MAKING
TRADITIONAL
COST-OF-SERVICE
REGULATION
“back to basics” strategies by focusing on rate-reg-
ulated activities. While most of the utilities we surveyed
currently operate under a traditional vertically inte-
grated model, few see that as the likely model for
their utility 20 years from now.
If the industry could regulate itself, what would it look
like?
Surprise; surprise. Most utilities would rather have
performance-based ratemaking over the traditional
cost-of-service model. This underscores the conten-
tious debate over the best approach to ratemaking
in today’s new paradigm of low electricity sales and
high penetrations of rooftop solar. Utilities may not
agree on which solution is best, but the results show
that many view the old way of doing business as a
hindrance to progress.
Whatever the preferred regulatory model, utilities
don’t expect the status quo to hold. Utilities will move
away from the traditional vertically integrated utility
model. Since the restructuring of the electricity indus-
try in the 1990s, many utilities have been pursuing
BUSINESS AND
REGULATORYMODELS
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 9
10. Q. What do you think your utility’s business model will be in 20 years?
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Deregulated distribution utility
Traditional vertically integrated
regulated utility
54%
17%
15%
18%
24%
32%
8%
11%
10%
10%
Smart integrator utility
Energy services utility
Other
Current business model Business model in 20 years
Both models are a big step away from today’s utilities
that make money from selling electricity, not saving
it. The industry appears keen to build business models
around new opportunities such as distributed energy
resources, energy efficiency, and demand response.
Despite the excitement around new business models,
Hawaii stands as a cautionary tale for the rest of the
industry. Its unique isolation and reliance on fuel oil
led to the rapid and sudden proliferation of distribut-
ed generation. The percentage of Hawaiian Electric
customers who have installed rooftop solar has sur-
passed 10% — the so-called tipping point at which
industry experts believe utilities will experience sig-
nificant operational and financial issues.
A significant number of utilities see themselves be-
coming smart integrators. The smart integrator utility
is a deregulated entity responsible for building, op-
erating, and maintaining the smart grid platform on
which new services, technologies, and marketplaces
will rely. The smart integrator utility, whose revenue
is decoupled from electricity sales, is expected to
fulfill energy efficiency mandates.
An even greater number of utilities see themselves
moving to an energy services utility model. Under
such a scheme, the utility would not make its money
by selling a commodity, but by operating the smart
distribution platform and providing value-added
services to the consumer. Energy efficiency would
become the utility’s mission and profit center.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 10
11. Hawaiian Electric has been struggling to figure out a
business model to adapt to the changes. Regulators
turned down its most recent integrated resource plan,
calling it unsustainable and overly reliant on a string
of capital projects with no “strategic focus on the clear
issues facing the utility.”
In late 2014, NextEra Energy reached a deal to buy
Hawaiian Electric amid speculation that NextEra would
use Hawaii as a testing ground for new business
models and solutions to distributed generation and
renewable energy integration issues. (A NextEra
spokesman would only say the idea was “interesting”
when reached for comment by Utility Dive.)
The next generation of utility business model may
indeed come from Hawaii. The utilities there are tasked
with solving the key challenges facing the industry
well before they hit the mainland. Only time will tell
what those solutions will look like.
71%
51%
48%
25%
21%
9%
Consumer infomation services
Distributed system platform
Premium power options
Other
Energy efficiency and demand response
Distributed generation
Q. What new business models is your utility developing?
The next generation of utility
business models may come
from Hawaii.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 11
12. Q. What load growth trends are your utility
seeing in its service territory?
23%
68%
9%
We are seeing minimal or
stagnant load growth
We are seeing significant
load growth
We are seeing negative load
growth
Unsurprisingly, non-contiguous states reported the
highest percentage of utilities that are seeing negative
load growth. Distributed energy resources are more
economical in those regions due to the higher costs
of electricity.
The question, as always, is: What should utilities do
about depressed electricity sales? No clear solution
emerged from the survey. The most frequent answers
from utilities were to develop new business models,
regulated or otherwise.
Beyond that, there was smattering of interest from
utilities in revenue decoupling, increased fixed bill
charges, and premium power sales. Only 5% of utili-
ties viewed lost revenue adjustment mechanisms as
the best way to mitigate stagnant load growth, perhaps
because the approach is so complex.
The drive toward new regulatory models stems, in
part, from the stagnant growth of electricity sales.
After the recession, optimists predicted electricity
demand would rebound with economic recovery,
utilities would build new power plants, and profits
would once again flow from greater electricity sales.
That no longer appears to be the case. The majority
of utilities we surveyed reported little to no load growth
in their service territories. The industry is struggling
with the rise of energy efficiency and rooftop solar,
both of which eat away at demand for utility power.
The healthiest areas of load growth were seen in the
central Southern states, where the Electric Reliability
Council of Texas (ERCOT) and the lower half of the
Midcontinent Independent System Operator (MISO)
are located. The population in those regions is grow-
ing faster than in most other states, according to
figures from the U.S. Census Bureau.
ELECTRICITY SALES
The U.S. electric utility industry
is struggling with low sales
numbers as a result of the
growth of energy efficiency
and rooftop solar.
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 12
13. The outlook is dim for any industry when product
sales fall — especially if there is little hope that sales
will rise again in the near future. When it comes to
the challenge of stagnant load growth, the utility in-
dustry is entering an adapt-or-else period.
Energy efficiency will likely need to be core to the
utility of the future, but it’s not yet clear how regulators
will enable utilities to make it happen. Many policy-
makers argue that an investor-owned utility cannot
push both electricity sales and savings. Revenue
decoupling is one way to mitigate the conflict of in-
terest, although efficiency advocates argue that it
removes disincentives to efficiency without actually
incentivizing it.
Regulators will need to find new ways for utilities to
monetize energy savings if they are to move beyond
the commodity-based business models of the past.
Forward-thinking utilities will even look to provide
value-added services behind the meter — if regulators
will allow it.
There is no clear solution
for low electricity sales
growth. Tellingly, the most
common answer from utility
executives was to develop
new business models.
Revenue
decoupling
Lost revenue
adjustment
mechanism
Develop new
regulated
business models
Develop new
unregulated
business models
Offer premium
power options to
customers
Increased fixed
bill charges
Other
What is the best way for utilities to mitigate
the impact of stagnant load growth?
17%
14%
5%
5%
22%
23%
13%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 13
14. With the Clean Power Plan taking center stage,
utilities see a diminished future for carbon-
intensive fuels. The majority of utilities expect
the percentage of coal in their fuel mix to decrease.
Nearly half see oil declining as part of their fuel
mix, presumably as diesel peaking plants give
way to cleaner and cheaper alternatives like
demand response.
Nuclear power is in limbo — and the Clean Power
Plan only muddies the waters further. On the one
hand, nuclear is one of the plan’s building blocks,
which bodes well for its role in the future supply
mix. At the same time, it is hard to envision the
U.S. embracing a nuclear renaissance after its
decades-long resistance to the fuel, especially
amid the ongoing push to shut down plants like
Indian Point in New York. Utilities surveyed
reflected the regulatory uncertainty surrounding
nuclear in the results — 16% see an increase in
nuclear, 21% see a decrease, and 35% see no
change in nuclear as part of their overall fuel mix.
Natural gas is cheap and abundant — the U.S.
has enough of the fuel to last about 85 years at
the current rate of consumption. It accounted for
half of the new generation in 2013, and the Energy
Information Administration expects gas-fired
generation to keep growing at 1.3% annually
through 2040.
Long dominated by coal power, the U.S. energy
mix is changing fast.
The utility industry’s fuel mix is changing in line
with today’s government policies: more natural
gas, less coal, greater energy efficiency, and more
renewables.
Most utilities predict they will increase the amount
of natural gas, wind, and utility-scale solar in their
fuel mix over the next 20 years. A whopping 84%
of utilities predict that distributed energy resources
will also increase as part of their overall fuel mix.
The industry’s bullish take on natural gas, energy
efficiency, and renewables likely stems from the
Clean Power Plan, the Environmental Protection
Agency’s (EPA) proposal to reduce carbon dioxide
emissions 30% nationwide by 2030.
In what is one of the biggest surprises in Utility
Dive’s State of the Electric Utility survey, utility
executives do not oppose the Clean Power Plan
in great numbers. In fact, over 60% think the
emissions regulations are acceptable as is — or
should be even more stringent. This sentiment
— that utilities largely support the Clean Power
Plan — dovetails with another surprising reason
that utility executives favor investing in clean
energy: sustainability.
Concern over federal emissions standards has
heightened over the last year, however. The
percentage of utilities that listed emissions rules
as one of their most pressing challenges doubled
since last year’s State of the Electric Utility survey.
State portfolio standards are
the biggest driver of utility
investment in renewables.
FUEL MIX
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 14
The percentage of utilities that
listed emissions rules as one of
their most pressing challenges
doubled since last year.
15. Coal
Natural Gas
Wind
Utility-scale solar
Nuclear
Oil
Distributed energy
resources
Hydro
Stay the same Increase Decrease N/A
How do you think your utility’s fuel mix will change over the next 20 years?
14%
17%
12%
62%
9%
35%
17%
5%
74%
72%
79%
15%
3%
16%
3%
84%
7%
4%
2%
8%
77%
21%
45%
2%
5%
7%
8%
15%
35%
27%
11%
9%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 15
The U.S. electric utility industry plans to increase
natural gas, solar, wind, distributed energy resources,
and energy efficiency as part of its fuel mix over the next
20 years. Meanwhile, the industry expects to use
significantly less coal and oil over the same period.
16. But the last winter provided the industry with a
worrisome reminder of the problems associated
with relying on natural gas. Bitter cold sent
electricity prices shooting skyward when parts
of the country could not secure enough natural
gas for their power plants. While the extreme
cold may have been an anomaly, few are betting
on it. Hard-hit areas like New England are fervently
seeking ways to avert a repeat of the natural gas
scarcity they experienced during the 2014 polar
vortex.
When it comes to the U.S. fuel mix, it’s never easy
to gaze into the crystal ball. What once seemed
to be reasonable and well-educated guesses are
often later proven to be woefully wrong. Just 10
years ago, few imagined solar would grow so fast
— or that coal would fall so fast. The utility view
here is probably best seen as a snapshot in time
— a projection of what will happen if today’s
policies, markets and technologies stay on their
present course for the next 20 years.
34%
42%
28%
31%
20%
12%
9%
7%
19%
EPA should make emissions
reduction targets and timetable
more aggressive
Sustainability
EPAshouldholdtocurrentemissions
reduction targets and timetable
Clean energy targets or mandates
EPA should lessen emissions
reduction targets and timetables
Emissions standards
There is no compelling reason to
invest in clean energy
Low prices
EPA should scrap plan entirely
Q. How should the EPA move
ahead with its plan to reduce
carbon dioxide emissions 30%
nationwide by 2030?
Q. What is the most compelling reason for
utilities to invest in clean energy, such as
renewables and energy efficiency?
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 16
17. and Tucson Electric Power — have received
approval from regulators to offer utility-owned
solar to their customers. It is unclear if regulators
in other jurisdictions will be willing to approve
similar programs.
Nearly half of the utilities surveyed are willing to
try the new — and more daring — approach of
buying power from customer-sited distributed
energy. This is an intriguingly high percentage,
given that detractors argue the practice may
jeopardize grid reliability if pursued to a large
degree. Utilities pursuing this strategy must answer
The greatest challenge for the utility industry may
be its greatest opportunity.
The vast majority of utilities see distributed energy
resources as an opportunity. The sentiment is
near universal across the country. The numbers
never dipped below 70% in any region we
surveyed.
It’s clear that utilities want to find ways to
incorporate distributed energy into their business
models rather than letting competitors own the
sector. But while there is clearly money to be
made in distributed energy for utilities, there are
operational hurdles to overcome, policy disputes
to settle and no proven business model in sight.
Of the utilities that see an opportunity, the majority
are not sure how to build a business model around
distributed energy resources. For the most part,
utilities favor the more traditional approaches of
partnering with independent third-party vendors
and making regulated investments.
The latter approach is highly controversial. In
Arizona, two utilities — Arizona Public Service
DISTRIBUTED ENERGY
RESOURCES
Q. Does your utility see distributed energy
resources as an opportunity?
33%
56%
12%
Yes, we see an opportunity,
but aren’t sure how to build
a business around DER
Yes, we are already building
business models around DER
No, we do not see an
opportunity
Profitability
Grid Operations
Resource Planning
Other
What is the biggest challenge your utility has
with regard to distributed energy resources?
32%
32%
29%
8%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 17
18. the difficult challenge of system planning with
variable generation from independent customer-
sited resources.
Less than half of the utilities surveyed are open
to the idea of launching competitive business
arms to offer distributed energy resources to
customers.Thoughutilitiesoftenhaveunregulated
subsidiaries, it remains a controversial practice
with opposition from independent companies
who say utilities will inevitably favor an affiliate
no matter the walls built by regulators. And if
history is any indicator, competitive utility spinoffs
typically don’t do very well. It’s just not a utility’s
core competency.
Given this backdrop, it’s easy to see why New
York’s Reforming the Energy Vision (REV)
rulemaking is getting so much attention. The REV
tries to solve many of these problems through a
market mechanism for distributed energy
resources similar to the one used for wholesale
power markets.
The REV is complex — and radical. It could lead
to a grid where distributed energy and energy
efficiency are primary resources and centralized
generation is secondary. Not every state is ready
to make such a bold move, but if REV moves
forward in 2015 as envisioned, it will likely redefine
the debate over the grid of the future in state
regulatory commissions across the country.
48% of utilities are developing
new business models around
distributed generation.
Net metering at the
wholesale rate
Net metering at the
retail rate
Value of solar tariffs
Feed-in tariffs
Rooftop solar should
not be compensated
Other
What is the best way to compensate rooftop solar
for the electricity it sends back onto the grid?
18%
6%
42%
17%
11%
7%
Other
Make regulated
investments in DER
where possible
Compete through
non-regulated
subsidiaries
Partner with third-
party providers
Procure power
from customer-
sited DER
Utilities should
not invest in DER
How should utilities invest in distributed
energy resources? (Check all that apply)
37%
3%
53%
55%
46%
6%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 18
19. The challenge for utilities is that hackers are contin-
uously revising their weaponry, forcing IT experts to
reframe their defenses. Meanwhile, the very technol-
ogies meant to protect the grid from storm-related
failures — such as microgrids and smart grid technol-
ogies — open new doors to cyberattacks.
Grid security loomed large for utilities in 2014.
A leaked federal report found a strategic attack on
just nine substations could cripple the nation’s elec-
tric grid and leave large swaths of the country without
power. This came on the heels of a sniper attack on
a Pacific Gas & Electric substation in Silicon Valley in
2013.
Perhaps even more daunting is the growing volume
of cyberattacks reported by Homeland Security against
energy facilities. The energy sector was the target of
more than half of all cyberattacks in the U.S. from
October 2012 to May 2013.
Although utilities see themselves as the primary line
of defense in securing the grid, most say their grids
are not adequately protected from physical and cyber
attacks. The vast majority of utilities surveyed are
increasing spending to prevent attacks.
Pressing questions loom about how easily utilities
can recover security costs. Grid security is a new
world for utilities and there is minimal federal guidance
available, as the Connecticut Public Utilities Regula-
tory Authority pointed out in a report in April. The
responsibility falls to state commissions, which have
little experience preventing terrorism.
When it comes to grid security, the stakes are much
higher than, say, energy efficiency or employee
benefits. Utilities will need to spend wisely and be
prepared to educate regulators as they make the
case for new security investments in upcoming rate
cases.
GRID SECURITY
53% of utility executives report
their utility’s grid network is not
adequately protected from physi-
cal and cyber attacks.
Q. Who do you think should be
primarily responsible for grid
security?
57%
19%
15%
7%
2%
An independent reliability entity
State regulators
Other
Utilities
Federal government
82%
15%
13%
7%
No, it will stay the same
Yes, it is decreasing
Yes, it is increasing
My utility is not investing in
grid security
Q. Is your utility’s investment
in grid security changing?
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 19
20. The dearth of young employees comes at a particu-
larly bad time for the industry. Utility operations are
becoming more complex with the advent of newer,
smarter technologies. Utilities must adapt, but its older
workforce is accustomed to running the grid the
old-fashioned way. This perpetuates “the conservative,
consensus driven culture that has challenged inno-
vation in the industry,” according to Pricewaterhouse-
Coopers.
Utilities are struggling to identify the best way forward
in a changing market. Part of that challenge springs
from the age of the industry’s workforce and the lack
of younger and more digitally savvy forward-thinking
employees. If the industry wants to reinvent itself, one
of the first steps to take is to renew its workforce.
The U.S. utility industry faces a shortage of skilled
workers as older, more experienced employees retire.
Within utilities, concern exists that too few young
workers are available to move up the ranks. Only 7%
of respondents to this survey were under 30, while
75% were 40 or older. With the U.S. economy on the
rise, the problem may worsen as competition height-
ens for younger workers with technical skills.
It may be even more troubling at the top. A 50% in-
creaseinexecutiveswhobecameeligibleforretirement
occurred between just 2011 and 2012, according to
PricewaterhouseCoopers.
THE AGING
WORKFORCE
Only 7% of utility executives
we surveyed were under 30,
while 75% were over 40.
Q. What best describes your
feelings about the age of your
utility’s workforce?
53%
36%
11%
I am optimistic because my
utility is working to recruit
younger workers
I am concerned about the
fact that it is growing older
I don’t think my utility
needs to worry about an
aging workforce
40-49
30-39
50-59
60-69
29 and under
70 and over
What is your age range?
17%
7%
1%
22%
18%
35%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 20
21. Utilities are entering an age where they will need to
better understand, engage with and ultimately service
their customers.
Unfortunately, utilities largely engage their customers
in traditional ways and only as needed, such as for
billing and customer support. Let’s face it — no one
likes paying the electric bill and customers usually
only call support when they have a problem. Similar-
ly, 49% of utilities engage their customers around
power outages — not exactly what one would call a
positive moment for the customer, though it remains
a necessary endeavor.
Perhaps indicative of the future, many utilities cited
community education and outreach, energy conser-
vation tips, service offerings, and discounts and
promotions as ways they engage their customers.
These are all types of services that utilities will need
to offer their customers if they choose to pursue a
less commodity-focused business model, as many of
the executives who took Utility Dive’s State of the
Electric Utility survey have indicated.
It’s common industry wisdom that customers simply
don’t care about energy unless they get an exorbi-
tantly high bill or are hit by a power outage. That may
be true today, but a report from New York’s REV
proceeding suggests that access and technology play
a big role in engaging customers. The industry is just
beginning to install the technology — and create the
market access — that could give customers new and
important reasons to not only care about, but engage
with their energy usage.
THE CUSTOMER
RELATIONSHIP
The utility industry has entered
an age where they will need to
better understand, engage
with and ultimately service
their customers.
Q. Is your utility’s investment
in customer engagement
changing?
76%
17%
4%
2%
No, it will stay the same
Yes, it is increasing
Yes, it is decreasing
My utility is not investing in
customer engagement
Community
education and
outreach
Conservation tips and
peer comparisons
Billing and customer
support
Energy usage data
Service offerings
Discount and rebate
promotions
Demand response
events
Other
Power outages
What are the top ways in which your utility
engages its customers? (Check all that apply)
58%
50%
45%
34%
2%
49%
63%
58%
72%
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 21
22. The U.S. electric utility in 2015 is transforming to
become the utility of the future.
The utility of the future will have a diverse fuel mix,
including solar, wind, natural gas, energy efficiency
and distributed energy resources. The utility of the
future will provide the smart grid platform for new
energy technologies and services. The utility of the
future may even provide some of those services and
technologies to the consumer, who is ultimately at
the heart of everything the utility of the future does.
The utility of the future’s revenue will not come from
electricity sales, but electricity savings, in order to
better align the utility business model with societal
goals.
There will be no one path to the utility of the future,
given that each utility is governed by at least one of
50 different state regulatory bodies. But the foundation
will likely be the same across the country. The outcome
of New York’s REV, in particular, could prove instructive
for utilities and regulators across the country.
Utilities know a smart distribution platform and new
energy services are the foundations of the industry’s
future. It’s simply a matter of figuring out how they
will make it happen.
A smart distribution platform
and new energy services are
the foundations of the
utility industry’s future.
LOOKING AHEAD
in
share
STATE OF THE ELECTRIC UTILITY 2015Utility
Bra nd St udio
PAGE 22