Vast Majority of Utility Stakeholders Expect a Major Shift in Business Models Because of Distributed Energy
Navigant and Public Utilities Fortnightly Release State & Future of the Power Industry Report
The report presents findings from a PUF reader survey of 366 utility
industry insiders on the future of electricity, summarizes
“off-the-record” conversations held by PUF editor
"This study points to several forces that will continue to transform the
way utilities do business. Although DER is already growing faster than
central station generation this year in
Although more than half of survey respondents believe the role of regulated utilities would not undergo significant change in providing services to customers within the decade, most recognize that advances in technology and changing customer demands present new opportunities and challenges. These findings suggest a more conservative approach by utilities, with 70% of respondents indicating that a utility’s ability to provide reliable power is still the most important role, significantly ahead of affordable and green power.
Additional key findings from the survey include:
- Solar Photovoltaic (PV) (70%), energy efficiency (42%), demand response (40%) and energy storage (39%), were named as the most prevalent DER solutions in terms of capacity by 2025.
- More than 90% of survey respondents believe that the growth of DER will force a major shift in utility business models.
- Almost 50% of industry respondents pointed to a supportive regulatory environment as the most important tipping point for moving aggressively into owning and operating DER.
- Almost 50% of the survey participants believe that by 2025 there will be five or more states to adopt a distribution-level system operator model.
- Over 80% of the respondents believe that residential and commercial customers’ demand for choice and control will change moderately (50%) or substantially (33%).
- Emerging customer engagement channels that respondents believe will be most widely used to deliver value to customers are: apps (55%), behavioral & analytical demand-side management (38%) and integrated energy services platforms (37%).
Survey findings point to an increasing threat of cyberattacks, as a
result of increased connectivity on both sides of the meter:
- 55% of the respondents expect there will be one or two serious electric service disruptions in the coming years.
- 30% expect there will be several serious service disruptions in the coming years.
“While utility stakeholders voice widespread consensus that the industry is facing profound change and advances in technology and changing customer demands present new opportunities and challenges, the lack of urgency to change the services offered to customers that surfaced in this report is concerning," added Vrins. "Providing reliable, safe, and affordable power are table stakes, and utilities must evolve their business models to include sustainable, intelligent, and distributed elements of the energy cloud in order to serve their customers and protect shareholder value.”
To see the full report and to learn more information about Navigant’s
About Public Utilities Fortnightly
Public Utilities Fortnightly (PUF) has been, since 1929, the magazine of record for the electric and natural gas utilities industry. It is a forum for commentary, opinion and debate on utility regulation and policy. PUF is must-read for the broad readership of some fifteen thousand-plus senior utility managers, regulators, policymakers, and leaderships of the asset owner/developer, advocacy, financial, legal, engineering, economic and consulting communities that must address the industry's challenges every day.
For more information:
Navigant Investor Relations
Aaron Miles, 312-583-5820
Navigant Corporate Communications
Megan Maupin, 312-583-5703