Around the world, utility companies are responding to a changing business model by incorporating a series of innovative strategies. The driving force behind such changes is technology. Over the last 10 years, utility companies have begun investing in a diverse array of technologies. Many of the changes that have taken place in the utility industry have occurred since the introduction of smart grid technology. The most prominent technologies include feeder automation, distribution substation, monitoring functions, and advanced metering infrastructure. Moving into the future, it will be incumbent upon utility companies to continue investing in the latest technologies to meet both current and future needs while meeting requirements of smart grid applications.
Mergers within the Industry
As is the case with many other industries, utilities have begun to form mergers in a number of spaces, including distributed energy resources, renewables, energy management, etc. Most recently, there has also been a trend involving cross-industry movements. For example, many utility companies have elected to invest in natural gas assets. Other utility companies have begun investing in areas of opportunity, such as renewables, demand response, distributed generation, and energy efficiency. Total, a French firm, announced it intends to become a leading player in electricity and renewables within the next 20 years. In order to accomplish that goal, the company is creating a division dedicated to gas, renewables, and power. While working toward becoming one of the top three global solar power companies, Total will be expanding energy storage and electricity trading and plans to spend at least $1 billion annually in renewable energies. Additionally, Total will be increasing its share of clean energies by 2035 from 3 percent to 20 percent.
The Expansion of the Energy Cloud
Gradually, the utility infrastructure of the past is being replaced by the use of a power grid architecture that is smarter and more decentralized. This emerging platform is known as the Energy Cloud, and it incorporates two-way power flows in addition to an intelligent grid structure. Overall, this combination is expected to provide a much higher quality of power. Certain risks are posed by such a shift; however, there are also many opportunities. In particular, this is important within a market that has become more and more competitive and innovative. Such a transition will have an effect on policy and regulation while affecting business models in the future.
It is vital that the power of such trends not be underestimated, as change within the energy industry is being accelerated as a result. In addition to facilitating the entry of new players into the industry, such trends are placing an increasing amount of pressure on players already within the industry to change their existing business strategies and models. Organizations will need to adapt to continuing transformation in order to remain competitive.
Demand Response and Energy Efficiency
The way in which customers are approached with energy efficiency and demand response by utility companies is changing quickly. CLEARResult is one of the companies currently at the forefront of this change. This Austin-based company helps with the design and implementation of energy programs. In addition to increasing customer expectations, regulatory issues are now leading to more interest in demand management programs. Opower is also working in this field. By making behavioral demand response more reliable and predictable, Opower is working to engage customers. Recently, the company announced that such programs resulted in saving utility companies up to 5 percent during off-peak demand. The massive amount of energy usage generated by smart meters is now driving a continued expansion of behavioral demand response. In fact, this expansion is proving to be so great that worldwide spending on analytical demand and behavioral management is expected to increase to $2.5 billion by 2024.
The Emergence of Third-Party Energy Services
In many areas, energy services are now being provided by third parties. In regards to energy efficiency, new markets and products are now being made available. This has become particularly important to consumers in certain areas where they might have previously found such products to be too cost prohibitive. In the past, the cost has been a serious barrier to entry. Today, numerous third parties are entering the industry while making innovative technology approaches far more affordable. Additionally, utility companies have begun to identify even more opportunities for saving money through the formation of third-party providers. ComEd, PG&E, and TXU have announced the formation of partnerships with software startup Bidgely in an effort to provide consumers with disaggregated energy consumption using an app. The app is meant to assist consumers with reducing usage.
Around the world, the need to save energy has increased significantly. Consequently, more companies have turned toward new technologies that facilitate the conservation of energy. Energy conservation not only is important for saving energy, but can also have an impact on legislation, energy prices, and emissions targets.
Energy management technologies now center on the collection of relevant data and metering the consumption of energy. Along with estimating the amount of energy that could be potentially saved, the identification of opportunities to save energy is now at the forefront of emerging industries. Eneas Group is one of the leading players within the Scandinavian energy services industry and is now at the forefront of energy metering and management. This firm is responsible for handling a variety of tasks related to managing energy and tracking and optimizing electricity infrastructure.
Eneas also collects, controls, and verifies meter readings in an automatic manner, making it possible for billing and pricing to be handled more accurately. By providing and operating smart grid metering solutions, Eneas helps commercial buildings occupied by multiple tenants to be more efficient. For more information, visit the company’s blog.
Currently, the utility industry is at a critical turning point that could result in a number of groundbreaking changes. Trends emerging in the power industry are making it possible for utilities to work in a more efficient manner while also meeting regulatory demands and giving consumers the opportunity to save money. In the future, the utility industry will likely witness the emergence of even more technological trends that will change the way in which energy is consumed.