Greentech Media reports on the 4 Trends Reshaping the Power Sector in their newsletter published yesterday. Greentech Media makes the case that:
The power sector is constantly evolving, but rarely — if ever — has it experienced the rapid pace of change it faces today. The interaction between technological, economic and political forces is catalyzing what could become the most dramatic transformation of electricity in the past century.
It is an interesting view of the critical transformations influencing the power and utility industries. GTM has published a research brief on these trends that is available here.
The 4 trends explored in the research brief, and summarized in the article, are: decarbonization, decentralization, vehicle electrification and energy access. These are undeniable trends in our industry. Made more remarkable, the article and the research brief note, by the fact that these trends are all emerging at the same time. Perhaps the most interesting parts of the brief are the questions that GTM raises about each trend. In fact, these dynamics raise significant, thorny questions like:
- How will electricity market design and regulation adapt to ensure reliability and affordability during the decarbonization transition?
- How will utility companies adapt to the proliferation of customer-sited distributed energy resources?
- Will electricity tariffs evolve to send customers time- and location-based price signals?
- Will microgrids emerge as a viable alternative to centralized grids?
The following Greentech Media graphic shows the ways in which the utility and power markets may evolve.
And many others…
From our point-of-view, there are significant consequences for customers from the trends described above. Perhaps it is better described as a key principle to the successful navigation and, ultimately, evolution of the power and gas sector from where it is now (largely monolithic, one-way, slow to change) to where it may end up (decentralized, responsive, flexible and resilient). This principle is:
A laser focus on customers and their needs, from residential to institutional to commercial and industrial, and a commitment to price, market and technology transparency.
The only way that power sector evolution becomes a true transformation is a commitment to involving customers and giving them what they want; and then doing so with a focus on transparency, fairness and integrity on the part of policy makers, utilities and product providers.