Wednesday, September 18, 2013

Companies Unplug From the Electric Grid, Delivering a Jolt to Utilities -

Companies Unplug From the Electric Grid, Delivering a Jolt to Utilities -
Since 2006, the number of electricity-generation units at commercial and industrial sites has more than quadrupled to roughly 40,000 from about 10,000, according to federal statistics.
On-site generation still accounts for less than 5% of U.S. electricity production. But it is peeling off some of the bulk sales that utilities find especially profitable. And some of the companies getting into the business think it is approaching a tipping point called "grid parity," at which point power would be as cheap to make as to buy from a utility.
Interesting. It seems the distributed power is the growing market, and in the following paragraphs, solar panels are singled out as choice of generation method.
How would traditional fossil powered generators play in this segment?

It seems that the utilities are responding the threat, by deterring the competition.
Regulated utilities in a number of states—Arizona, California, Colorado, Idaho and Louisiana—have started to complain about the various benefits for photovoltaics (PV), 
And blah, blah, ....

BusinessWeek does not think the future is bright for them.
Regulators set rates; utilities get guaranteed returns; investors get sure-thing dividends. It’s a model that hasn’t changed much since Thomas Edison invented the light bulb. And it’s doomed to obsolescence.  That’s the opinion of David Crane, chief executive officer of NRG Energy, a wholesale power company based in Princeton, N.J. What’s afoot is a confluence of green energy and computer technology, deregulation, cheap natural gas, and political pressure that, as Crane starkly frames it, poses “a mortal threat to the existing utility system.” He says that in about the time it has taken cell phones to supplant land lines in most U.S. homes, the grid will become increasingly irrelevant as customers move toward decentralized homegrown green energy. Rooftop solar, in particular, is turning tens of thousands of businesses and households into power producers. Such distributed generation, to use the industry’s term for power produced outside the grid, is certain to grow.
The energy market will be fun to watch in next decade ...

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