Utility Dive lists Top 10 transformative trends: What do you think?

Transformation could be the most overused word in the electric utility industry these days. Big data, energy storage, the internet of things and electric vehicles are just a few of the technologies we are being told will change the way we do business forever.

But what utility professionals see on the ground may be quite different, both from what we hear and from what other utilities are dealing with. The trends that are actually affecting your utility depend on what part of the country you serve, what your customer base looks like and whether you are an investor-owned or public power utility.

To get a sense of where the utility industry is headed, the online magazine Utility Dive You are leaving WAPA.gov. recently identified 10 trends that seem destined to shape our near future:

10. Coal power in decline – Since 2009, 25 gigawatts (GW) of coal capacity has retired in the U.S., and another 25 GW of retirements are planned by 2022. However, the Environmental Protection Agency still expects coal to be a major fuel source for electricity generation through 2030.

9. Natural gas is growing fast – As market conditions and regulations push older coal generators into retirement, utilities are increasingly looking to gas plants to add reliable capacity quickly. Analysts still expect it to grow steadily over the coming decade and then switch to retirement between 2020 and 2030, a trend that could come sooner if natural gas prices rise from their historic lows.

8. Renewables reaching grid parity – Once dismissed as too expensive to be competitive, wind and solar—especially utility-scale—are reaching grid parity and often pricing out more traditional generation resources. In fact, the Department of Energy estimates that wind could be the nation’s single greatest source of energy by 2050, comprising up to 35 percent of the fuel mix.

7. Utilities face growing load defection – With the rapid proliferation of rooftop solar, some customers are bypassing their local utility for their electricity needs, especially in a few markets such as Hawaii and California. Customers combining load management strategies with rooftop solar installations could purchase less power from their utility, and may even cut the cord altogether.

6. Utilities getting in on the solar game – A number of utilities are responding to load defection and consumer demand for clean energy by expanding into the solar industry, both in the utility-scale and rooftop markets. Community shared solar, which allows customers without suitable rooftops for solar to buy a few modules on a larger array, grew exponentially between 2014 and 2016.

5. Debates over rate design reforms and value of distributed energy resources (DERs) are heating up – Altering rate designs to properly value distributed resources is a trend that has largely grown out of retail net metering. This pays utility customers with solar the retail rate for the electricity they send back to the grid.

4. Utilities are modernizing the grid – Adding new utility-scale and distributed renewable capacity has increased the need for utilities to upgrade and modernize their transmission and distribution grids. Many of the regulatory initiatives underway to help determine the value of DERs also order their state’s utilities to prepare their distribution grids for increased penetrations of distributed resources.

3. Utilities buying into storage – Few technologies hold as much promise as energy storage for utilities looking to optimize their distribution grids and integrate more renewables. While the price for battery storage is still too high to make projects economical in regions with relatively inexpensive electricity, costs are coming down quickly.

2. Utilities becoming more customer-centric – Power companies used to think of their consumers simply as ratepayers, or even just “load,” but new home energy technologies and shifting customer expectations are pushing them to focus on individual consumers. Increasingly, utilities are seeing it in their best interests to market themselves to customers as “trusted energy advisors” of sorts.

1. Utility business models are changing – The common thread running through these trends is that they all are changing the way electric utilities have traditionally done business. Where utilities were once regulated monopolies, the growth of distributed resources is forcing them to rethink their business models. California and New York have captured most of the headlines for redefining the utilities’ role on the distribution grid, but other states have initiated their own dockets to transform business models.

It is likely that your utility has had to think about at least a few of these issues and may be grappling with more of them before long. Energy Services is here to help our customers manage these challenges and more. Contact your Energy Services representative to discuss how to turn transformation into your greatest opportunity.

Source: Utility Dive

Report: Utility-contractor partnerships affect success of energy-efficiency programs

Fast Water Heater CompanyRedirecting to a non-government site has released a white paper suggesting that utility energy-efficiency programs built around strong cooperation between contractors and the power provider are likely to get more customer participation.

Approaches on Utility-Contractor Partnerships compared the experiences of two utilities marketing very similar rebates for an almost identical product over a similar time period. The major difference between the programs was the level of contractor engagement and accountability—and the results. A large utility serving 5 million customers used a conventional, partner-neutral business model with minimal contractor evaluation. The second utility, with 700,000 customers, actively collaborated with approved contractors on program promotion and follow-through.

The results, summarized in an article in Intelligent UtilityRedirecting to a non-government site, were strikingly different. The utility using the partnership model achieved a 63-percent penetration rate, in contrast to the 8-percent penetration rate of the program relying on the traditional approach.

The effect that the difference in the size of the utilities might have had on the results does not get much attention in the article, but may be explored in more depth in the report. Also, the report doesn’t state whether the utilities are investor-owned or public power, which might reflect on the pre-existing relationships with their customers. Even so, the correlation between the partnership model and program success is worth noting.

The author, who is the CEO of Fast Water Heater subsidiary Demand Management Installation Services, addresses some of the reasons utilities prefer contractor neutrality, offering credible arguments for a more hands-on approach to energy-efficiency programs.

Studies like Approaches on Utility-Contractor Partnerships will be the focus of the Smart Cities conferenceRedirecting to a non-government site, Nov. 3-5, in San Diego, California. Innovative utilities and industry leaders will be presenting case studies and hosting discussions on the future of the energy and water efficiency as well as municipal-level sustainability programs.