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Utilities Face Billions In Losses From Distributed Renewables
Lucas123 writes: Over the next 10 years, adoption of distributed power in the form of renewables such as solar power has the potential to reduce revenues to grid utilities by as much as $48 billion in the U.S. and by $75 billion in Europe, according to a new study. The study, by Accenture, revealed that utility executives are more nervous (PDF) about the impact of distributed — or locally generated renewable power — than ever before. 61% of those surveyed this year indicated they expect significant or moderate revenue reductions compared to only 43% last year. The cost of rooftop solar-powered electricity will be on par with prices for common coal or oil-powered generation in two years, and the technology to produce it will only get cheaper, according to a recent report from Deutsche Bank. New technologies, such as more efficient solar cells, are also threatening to increase efficiencies and drive adoption.
...by Accenture
Stopped there.
Slashdot, fix the reply notifications... You won't get away with it...
reduce revenues to grid utilities
And there are costs associated with generating those revenues (pun intended). Will it tip the utilities into loss? Certainly not to the extent the summary implies.
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
The cost of rooftop solar-powered electricity will be on par with prices for common coal or oil-powered generation in two years
That will be a beautiful day.
"First they came for the slanderers and i said nothing."
Just Green propaganda, Utilities aren't scared.
Seems to be a lot of very similar articles at the moment.
If you would like to know how this thread will turn just go here - http://hardware.slashdot.org/s...
They'll just start to seek rent on their unmonetized properties.
Ij've been told tht renewables won't work by politicians and I know they would never lead me wrong.
Now let us get back to banning Tesla sales.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
Business rules: adapt or die.
Hell, this is existence 101 here.
They could be spending money to produce their own renewable power and lower prices just that little bit below local renewables so it undercuts them enough to slow them down considerably.
The cost of rooftop solar-powered electricity will be on par with prices for common coal or oil-powered generation in two years, and the technology to produce it will only get cheaper...
Shouldn't it be the job of government to offer incentives to those who take a responsible approach to energy and to assist in the production of it and see that those companies in line to lose be taking a responsible stance and if they would be willing to invest in reponsible energy renewables, they could earn subsidies.
we keep hearing how utilities will lose billions. personally, I view it as billions in savings to customers who will then use that for other things. If this buggy-whip service faces tough times, then so be it
BULLSHIT X 3!!! They've lost NOTHING! We're talking about projected earnings here. Or expected, if you're a lazy ass C**, who is resting on their laurels along with all the other board members. Nothing is certain with money, and EVERYONE in this game knows it! This about monetary shifts in a given economic sector.
Loss? Shifts within a market to more economically viable alternatives is not a loss. It's a shift! And so .... TOUGH SHIT legacy producer! Rather than innovate, you'd rather stagnate. You've been bleeding customers for years! I hope their death is lingering and painful!
What?
is all I can say? Did they cry for the blue collar buggy whip makers? No because it didn't hurt their bottom line. Adapt or die isnt that what market forces and the invisible hand is all about?
They have good reason to be nervous... They'll still be on the hook to provide full power when solar is producing less than peak capability or isn't producing at all, but there's little chance they'll be allowed to significantly raise their rates. This works out to being required to maintain full generating and transmission capacity with sharply reduced revenue.
Not to mention that very few people installing subsidized and/or cheap solar panels will spend the money to install unsubsidized and expensive battery capacity. That's long been a deep flaw in the thinking of solar power supporters - that they can have their cake and eat it too, the unspoken assumption that the utilities will always be there and will always have the capacity to make up any lack. You get what you pay for folks, TANSTAAFL.
Wouldn't have been a problem if they had not been privatized.
Guys, "lost revenue" is not the same as "loss". If I buy widgets for 99 cents and sell them for a buck, and my customers start buying fewer widgets, I'm not losing $1 for each widget they fail to buy from me, but that's exactly what the paper is suggesting.
Now, if my customers can make their own widgets and force me to buy them for $1 (as some states require utilities to do), I can claim that I'm losing money on that deal. But my losses are a penny a widget, not a buck.
We have a load control transponder here which allows the power company to temporarily shut off the air conditioner and/or water heater, basically creating a "rolling blackout" of just those devices when demand for power exceeds supply.
The fact that they deploy such devices suggests utilities would be happy to shed some load, especially during the brightest time of day when solar works best and air conditioners are working hardest.
So what's the deal? They want us to use more power after all?
I tell you with 100% certainty, this study is 100% wrong.
Why?
Because of the word 'prediction'. Nobody can predict the future or even come close to it. It's one thing to get something close a quarter or even one year ahead, but 10 years?
NFW.
A LOT will happen in 10 years; especially in renewable energy.
Those utilities are not envisioning the fact that all that power savings that is "eating into their profits" today is energy they can sell to tomorrow's customers. Why? Because populations grow over time, and they grow quite quickly. Instead of bitching about the paper loss they think they are seeing, they should be celebrating the fact that they don't have to build more power-plants and infrastructure for 10-20 years and will be able to serve a much larger base with the same infrastructure. So that 2% increase to the electric bill they apply for in 2024 will mean much, much more actual revenue for them - for exactly the same fixed cost.
But no. Greed. Let's bilk people today because they dare try to do something to save money and stretch current resources by diminishing consumption.
Seven puppies were harmed during the making of this post.
The study, by Accenture,
As soon as you said Accenture, every single bit of credibility vanished.
Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
And In other news: Horse and Buggy Industry Face Millions In Losses From Private Automobiles.
n/t
http://disinfo.com/2014/12/elo...
Yet Musk’s so-called gigafactory may soon become an existential threat to the 100-year-old utility business model. The facility will also churn out stationary battery packs that can be paired with rooftop solar panels to store power. Already, a second company led by Musk, SolarCity Corp. (SCTY), is packaging solar panels and batteries to power California homes and companies including Wal-Mart Stores Inc. (WMT) - See more at: http://disinfo.com/2014/12/elo...
"If any question why we died, Tell them because our fathers lied."
There is a cost to the consumer to generate power. There is also a cost to the consumer to not generate power. The migration to CFL's and LED's has not lowered anyone's electricity bill. It is a complete and utter fallacy. If a utility has to spin down a power plant to reduce production, you pay. If they have to increase production, you pay. That is why they have a monopoly. You are going to see more and more of this as the utilities push for mandatory connection fees, or utility "avoidance" fees. You are still hooked up to the utility, so they are entitled to collect taxes and fees even though you may be completely offsetting use of utility power with your own generation. It is the same mentality that you are seeing with hybrid and electric vehicles. They use the roads, but do not pay fuel taxes. So locations like California are now toying with mileage based taxes.
Time to tear down all those ugly power lines.
I built a house 1 mile away from the overhead power lines. They told me it would cost me 60K USD to run power to my house. FUCK THAT. I installed 6KW of solar panels a nice inverter a decent battery bank and a 30kw diesel genset for 20k. These leaches need to die a horrible death.
New technologies, such as more efficient solar cells, are also threatening to increase efficiencies and drive adoption.
THREATENING TO INCREASE EFFICIENCIES.
Humanity 2014.
Ok, so maybe I haven't spent enough quality time with TFA and the overproduced marketing blurb from Accenture that it was quoting, or maybe I'm the stupid that everyone is with, but it seems like the real meat of the article wasn't there. The whole thing reads like a deep fried twinkie.
So what does "billions of losses" mean in this context? It's certainly more money than my beer budget, or what I'm likely to ever win on the Powerball, but what is it as a percentage of the total revenue of the electricity producing industry? How much of this is a "reduction in the increase" caused by increased demand (due to factors like more electric cars, population increase, new particle accelerators, and other factors).
Does the author make an actual verifiable point, or is this another examples of "there's been a 10% increase in piano related deaths. Panic!" I can't really tell.
Oliver's law of assumed responsibility: If you're seen fixing it, you will be blamed for breaking it.
I can say that I hate my local power company. They have thwarted renewables and competition at every turn. I presently pay some of the highest power rates in North America while our Tiny power company's CEO earns one of the highest wages of any power company. Thus if some technology comes along that is 20% more per Kwh I will buy it if can give a big FU to the power company. I very much doubt that I am alone. Minimally nobody "loves" their power company and thus will feel no loyalty and stay if there are better options.
If I had a rooftop solar, a great set of economical batteries, and some sort of crunch time generation capability then I would literally smile each and every time I saw that the power company was struggling financially.
So anyone trying to figure out how many people will make the switch at any given cost they need to remember that customer inertia will be lower as people will be all too happy to make the switch if it is possible.
My hope is that the richer people in my locality will make the switch first which will be in the high profit downtown areas which will put a tiny dent into their profits. Then they will raise the rates a bit which will put another tiny dent into their profits. I hope that this becomes a bit of a cycle until they manage to corrupt a few local politicians into promoting a bill that will make rooftop solar illegal. Then this will hopefully cause a huge uproar that not only loses the government their next election but causes people to redouble their efforts to go off grid because now it is a political statement. Then I hope the power company goes bankrupt.
Oh and we will have a greener planet.
I can see them losing market share to renewables, but that's not the same as losing money.
There is nothing about legislation anywhere in North America that guarantees the continued success of an obsolete business model. No matter how many congressmen and senators the MPAA and RIAA have bought off.
I do not fail; I succeed at finding out what does not work.
Fear of loss of income? Complete BS. For years now, electric utilities have been preaching conservation, even to the point of doling out hard cash to encourage people to buy energy-efficient appliances. The economic model at work here is that if demand grows and outstrips existing supply, it would cost them much more (in money and troubles) to build new infrastructure to meet the demand. By that rationale, they should be welcoming the reduced demand/increased supply resulting from distributed power.
That's a win-win. It will drive up the price of grid power and make distributed renewables an even more viable alternative
Utilities are natural monopolies, and as such, are have prices set by a board at a "normal profit" level. If they lose money, they just go back to the board and they will adjust their prices. This is a non-story.
Germany and other European nations are quickly eliminating fossil fuels and nuclear. In the US we are behind in applying solar, wind and water energy both in a collective and individual way. But the handwriting is on the wall. Big energy will do every corrupt trick in the book to keep sucking at your wallet. As homes and businesses go off grid we will see much higher rates for homes still on the grid. This is Future Shock. It is rather like Uber threatening to eliminate the taxi industry. It is quite like Tesla threatening to cripple gasoline and diesel producers and the cars and trucks that use gas and diesel. And it is like robots replacing fast food workers. It is all happening at a very high speed and some social chaos will follow.
....smells suspicious - all the meme-generating about "utilities are terrified of renewables" from multiple sources and multiple directions makes me think that someone's laying the ground work to fight the eventual effort of "Ah, so, now that renewables are so fearsome, I guess we need to pull their subsidies".*
*to be clear, I would love to see the subsidies pulled from ALL power generation, conventional, nuclear, and renewable, and let's actually see which wins out in the marketplace as the cheapest (or, if not precisely cheapest, the best compromise for the bulk of the populace between cheap, sustainable, and clean). But that's a Pollyanna belief; I know there's too much money/power in power for it not to be gamed by every side simultaneously.
-Styopa
poor executives won't be multi-millionares, awwwwww
cry me a river you parasitic pieces of executive shit
Will die out, like the dinosaur.
They turn the damn power plant down and feed it less fuel which costs less money. I call massive bullshit on this one.
All those billions saved by the consumer will be funneled back to the local economy and smaller companies. Those companies will develop new technologies faster than some company only concerned with profits over market innovation. As an added bonus the gov will get a bigger chunk of tax since the little guya will pay way more corporate tax than some big ass corporation.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
So, why wait to install some alternative generator. Get yourself a battery farm and inverters - most power in the evening hours is sold at half rate or "off peak times. In my area is half - so take some of those new batteries from the up coming tesla battery plant, install them in your home. When its midnight charge up enough for "peek usage" and only buy at night.
IF you start to have issues with peak load during the day, then install all those panels, generators and backyard hydro plants if you are lucky to live by a hill and have a creek handy.
Switch to LED lights, even if they are like 60watt bulbs of old, they are 5 watts of power each and you could run 12 of the suckers for the same brightness to make any room look like the heart of the sun. (Granted the LED bulbs are way over priced but the lifetime average usage is 20 years)
I am going to this in the spring
Solar produces most energy during peak time, such as when cooling increases demand. Yes, they probably don't make money off solar production but they certainly save money and lives by not needing to do rolling-blackouts as much.
Those aren't losses, that's a reduction in revenue.
...and protect their business model! It's the American way (tm)(R).
"False hope is why we'll never run out of natural resources!" - Lewis Black
Yea the cost of lost, damaged, or spoiled products is factored into the price of everything.
We should be worried too. If power companies can't make money to cover the cost of maintaining the grid, they will stop doing it, since it has to be done, government will take over. As in everything government dose, they do it badly, so it will cost more to operate the grid, and the cost will be added to taxes. In any case everyone WILL pay one way or another to maintain the grid.
Misleading title of article I think, I think it meant lost revenue, not lost profit.
After following PV solar developments for over 40 years, I've noticed two things:
#1 - Every month there is a technology breakthrough that will 'revolutionize' the industry.
#2 - After 40 years (40 X 12 = 480 breakthroughs) we are 2X as efficient as before.
The utility industry needn't panic immediately. We'll need a few hundred more revolutionary breakthroughs first.
Oh, and storage technology? You guessed it, many more revolutionary improvements needed. Or maybe we should just return to the original meaning of revolutionary and dump the hype.
...omphaloskepsis often...
Wow, if Solar is that competitive, maybe they'll want to lease my roof?
I'd gladly sign up.
What planet are you from? No utility I'm aware of gives away power for free. Not to mention you completely ignored the required to cover periods when solar is providing sufficient power during the day. (Etc... etc...) You have no fucking clue what you're talking about.
So, what are we supposed to do? Is there some call to protect their interests? Are we supposed to shun solar now because somebody might not make their projected profits? Are we being told that our economic system abhors self sufficiency? For capitalism that appears to be so.
“He’s not deformed, he’s just drunk!”
Germany and other European nations are quickly eliminating fossil fuels and nuclear.
Take a look at these actual numbers. Nuclear Power down 0.1%. Brown Coal down 3%. Hard coal down 11%. Gas down 18%. Their overall production also decreased by 21 TWhrs or 4%. So any reductions in nuclear or brown coal can be covered by decrease in demand. Sorry but Germany will be using nuclear and fossil fuels for quite some time yet.
Take a look at January 2104 (Page 13). 80% of electricity was produced by conventional sources.
Do you have to post the same topic every two days!?! I know you are under the delusion that utilities are shaking the boots over renewables, but stop posting this topic every single time dice says it's your turn to post to the main page. That makes you a propagandist, not a journalist.
That means 20% was produced by renewables, or not?
So what is your point?
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
States will make it illegal or tax the shit out of it the same way several states criminalized homemade biodiesel and/or charge people a mileage road tax in lieu of gasoline taxes. Of course in the case of utilities they will shape it as 'public safety' and 'a reliable network' but that's nonsense. Anyway in most states the utilities get to pick their own regulatory boards which is why rates go up to whatever the utilities want.
It's about time the incumbent energy providers get their comeuppance. Of course where I live National Grid - and I'm sure we all know THEIR history and origins in Britain, well here I am in the northeast U.S. paying some of the highest electricity rates. Why? Because National Grid is feeling the pinch from solar and wind projects that keep popping up in my state. They even had the temerity to ask for another double digit rate increase this year. If the Rhode Island Public Utilities Commission grants this one I think all the staff and commissioners should be pilloried at a minimum.
Except for islands and other locations isolated from large scale energy production, oil is little used for electricity production. Citing the drop in oil prices in the context of the cost of fossil fuel for electricty generation just confuses the discussion.
I'm in Ontario, Canada.
Electricity as everywhere else is not some total free market system. It is some quasi semi regulated monopoly. It's public/private nature depends on the region.
This is my sample utility bill:
Electricity use:
on peak = $15
mid peak = $17
off peak = $30
Delivery:
$83
Regulatory Charges:
$5
Debt Retirement Charge:
$5
______________
The actual electric cost is less than half my bill.
The same is true of water. We had a big campaign years back to use less water. Whooops, they realized they were not taking in as much money. So they upped the 'delivery' aspect for water.
The utilities themselves will be okay as long as people/governments expect to be connected.
And then the big generators themselves will be okay because everyone wants a stable grid, so government will pay them some fixed rate to keep it all profitable.
That conventional is not being eliminated quickly.
An inevitable consequence of capitalism. Coal and oil are becoming obsolete, and better things will take their place. Good riddance.
Pfft ... doubling the renewables should double the yield ...
As far as I know we will be fully renewable around 2050, the greens even favour (and me too) 2030.
Of course I had preferred 1997 ... but alas.
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
This is where most utilities are today. They have so long been reaping the largesse of the taxpayer that they didn't keep an eye on the future, and that future is distributed, renewable, green resources. It is time we put these dinosaurs out of our misery!
Just saying. I mean, they have offices here, we know them well, it's part of why the pipeline deals are falling apart, since the internal energy firm documents show they intend to outsource all the factory and tech jobs to overseas temporary workers.
Energy firms should be more like Seattle City Light (public utility) which realized that many renters and home owners have houses that aren't suitable for installing solar or wind - e.g. in cities, part of a townhouse complex or condo or apartment where the bill payer can't easily install their own solar or wind power, but is willing to buy shares in City Light owned solar installations (in city) or wind farms (outside city).
Adapt or die.
Capitalism cares nothing for your heavily taxpayers subsidized fossil fuel lifestyle. Solar and wind are currently cheaper than oil and coal, for example. Remove the tax subsidies and cheap mining leases and fossil fuels would be even less optimal for consumers.
-- Tigger warning: This post may contain tiggers! --
The Utilities should be focused on the need to dramatically grow the market for electricity rather than worrying about losing 10% or 20% of today's small market to DER deployments. Today, only 1/3 of energy delivered to end-users is in the form of electricity. The remaining 2/3 is largely fossil fuels. Those fossil fuels are primarily consumed in direct, point-of-use combustion to provide energy in transportation or thermal (heating) applications. The utilities should understand that almost every penny of revenue that flows to satisfy the 2/3 of demand not currently satisfied by electricity is, in fact, money that could instead flow to the electric sector (both utilities and DER).
The key to growing electric revenues, and thus making DER irrelevant, is "fuel switching" -- switching from fossil fuels to electric vehicles and heat pumps (for heating/cooling). This switch is largely inevitable and will result in greater efficiency of energy use, lowered emissions, lower costs for consumers and higher revenues for utilities. Over the next few decades, it is clear that we must move away from fossil fuels. The environmental impacts of fossil fuel use will only become increasingly unacceptable and it is inevitable that the price of fossil fuels will increase. Over time, we'll see an increase in the portion of delivered energy that is in the form of electricity. We'll also see it generated from cleaner sources.
What we will see over the next few decades is the "Second Great Electrification" of society. The first great electrification began over a 100 years ago and has primarily focused on lighting, communications, appliances and entertainment. The Second Great Electrification will focus on transportation and HVAC (heating/cooling). The result of this will be one of the most massive transfers of income in history: We'll transfer most of the revenue and profits of the fossil fuel industry to the Electricity Generation industry -- some of which is utilities but much of which will one day be composed of site-sourced renewable energy such as rooftop solar, wind, etc.
Kind of kills your "argument".
However, it's irrelevant.
Solar power peaks when the price peaks, therefore the electric companies can't charge you a massive rate for your electricity, and, worse, companies generating their own power who are charged spot prices can avoid those spot prices and therefore cut seriously into their revenues and profits.
Peak use and peak spot price occur during the daylight hours, EVEN IN WINTER.