Distributed generation, often also referred to as decentralized energy, is a complex and essential topic for today’s utility industry. Best defined as power generation and/or energy storage at the point of consumption, DG is often grid connected but does not have to be.
While DG is far from new, the expansiveness of its technologies and rapidly broadening consumer accessibility and demand are. Over the last five years industry analysts have labeled the rise of DG as everything from a utility death spiral to an insignificant threat.
PennEnergy Research has completed a new consumer survey, which reveals key motivators for the adoption or planned adoption of DG, as well as consumer perspectives on their utilities current role in DG, what they want from utilities in the realm of DG and how they perceive the future relevance of their utilities as DG continues to proliferate.
Join PennEnergy Research at DistribuTECH, Feb. 3-5, 2015 at the San Diego Convention Center, San Diego, CA, where we will present the results of our Consumer Distributed Generation Survey and an exclusive industry report analyzing the results.
Key results and analysis include:
“- Which Distributed Generation system is the consumer option of choice?
“- What is the primary consumer motivator for wanting or having a DG system?
“- How soon is the average grid connected consumer planning to integrate DG?
“- What role do consumers want their utility to take in DG?
“- Does your customer still find utilities relevant with the availability of DG?
As more progressive utility markets have embraced and worked with consumer implementation of DG, industry outlooks have calmed a bit. Today it is more widely accepted that DG is an industry disruptor, but not a death sentence.
Although many industry analysts have begun to abandon the idea that DG represents a sort of death knell for utilities, most have concurred it will induce a paradigm shift in how most power enterprises will evolve to manage their resources and services. This is because DG is part of a larger consumer value chain, distributed energy resources (DER), which represents a combination of technologies like energy storage, demand response and DG that are consumer controlled.
Consumer controlled is where the industry challenges with DG reveal themselves. When residential and commercial consumers utilize DG to manage their electricity it not only disrupts the long-standing centralized business model that has brought utilities stable returns, it is also disruptive to how grids have been traditionally managed. Consumer controlled means consumer focused, which means as DG expands power production and delivery will become increasingly influenced by individual drivers and not system-wide ones aligned to current markets.
Beyond the consumer drive for DG is the push for consumer adoption of DER by government bodies focused on a broader penetration of renewables, electric vehicles and energy efficiency initiatives in support of environmental agendas. For government bodies and regulators, DG is less a disruptor and more a bridge in meeting increasingly stringent environmental standards and mandated state renewable portfolio standards (RPS).
All of these drivers paint a clearer picture of the rise of consumer DG and has prompted serious examinations into how utilities and other energy enterprises gage their business futures as DER becomes increasingly integrated into their markets.
There is no shortage of surveys, editorials and analysis weighing and forecasting the benefits and obstacles in the transition to a larger DG consumer base, yet rarely is this examination tangibly external. Most often DG analysis is industry led and centered on similar or competing utility structures. While these internal evaluations are valuable, they represent only half of the very important DG equation, utilities and their supporting industries and regulators.
The adoption of cell phones and tablets happened quickly, but far from overnight.
Decades of refinement, infrastructure modernization and the development of business and regulatory policy shape what many of us now take for granted in those industries. This is where utilities need to take their lessons in addressing DG.
The telecom companies that have continued to thrive set their sights on consumer-centric initiatives to successfully integrate those disruptive technologies into their business structures. The power industry has the ability to do the same with DG, but it needs to happen soon in order to keep pace with consumer adoption.
What must be added more consistently to the industry dialogue around DG are the motivations and planned actions of consumers. As the industry has focused itself on examining and securing their business structures, consumers have been actively determining the value of DG and the relevance of their utilities.
This utility-consumer disconnect must be closed and quickly. It is imperative that utilities and their related segments recognize these next few years as a window of opportunity to engage their customers so as to be able to cultivate an informed business approach to the rise of DG. Charting this course means bridging the information gap between what utilities are predicting and what consumers are doing and saying about DG.