Connect with us

Hi, what are you looking for?

CleanTechnica

Clean Power

Will Renewable Energy Cause A Utility ‘Death Spiral’? No Need For That

Last year, the Edison Electric Institute predicted that the widespread adoption of renewable energy (especially on-site electricity generation) is going to destroy the traditional utility business model that power companies have been using for all these years. New research says: not so much.

Photo Credit: snre.

People do not want to have to pay electricity bills for eternity anymore. With net metering, incentives, and new solar panel technology which is cheaper than ever, they can now seriously cut if not eliminate their electricity bills. That doesn’t sound good to electricity/utility companies.

Fortunately (for utility companies), a report from the American Council for an Energy-Efficient Economy suggests that this ‘death spiral‘ won’t happen after all. It says that national electricity sales would decrease only 10% by 2040 (at most), translating to an annual decline of only 0.4%.

In addition to that, utility companies have been fighting tooth and nail to suppress on-site electricity generation, further reducing the probability of rapid decline.


According to Green Car Reports:

If sales remain flat, the report’s authors recommend that utilities offer optional energy-related services to customers–including technical help and financing for larger customers installing and operating high-efficiency combined heated and power systems.

They also recommend that regulators adjust rates to allow companies to recover fixed costs more easily, incentivize increased energy efficiency, and modify the rules governing rates and services for added flexibility.

The report also advises utility companies to curtail the expansion of their infrastructure for now, unless they clearly foresee a rise in electricity demand.

Some utility companies may take their advice, although it is likely that many of them will continue business as usual and continue to fight rooftop solar and distributed energy storage (which helps people get off the grid altogether and drop utility companies for good).

Do you think the utility business model will be destroyed soon, or will it gradually transform as the American Council for an Energy-Efficient Economy said?

Sound off in the comment section below.

 
Check out our brand new E-Bike Guide. If you're curious about electric bikes, this is the best place to start your e-mobility journey!
 
 
Appreciate CleanTechnica’s originality and cleantech news coverage? Consider becoming a CleanTechnica Member, Supporter, Technician, or Ambassador — or a patron on Patreon.
 
Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Advertisement
 
Written By

writes on CleanTechnica, Gas2, Kleef&Co, and Green Building Elements. He has a keen interest in physics-intensive topics such as electricity generation, refrigeration and air conditioning technology, energy storage, and geography. His website is: Kompulsa.com.

Comments

You May Also Like

Climate Change

Preparing for emergencies and preventing disasters requires planning, equipment and communications. This is true for fighting fires and for keeping the electric power system...

Climate Change

With a unanimous decision, the Colorado Public Utilities Commission (PUC) has approved Xcel’s plan to accelerate the end of coal in the state. The...

Buildings

Heat pumps join climate fight with new high efficiency, cold-tolerant technology.

Batteries

Tesla’s US Energy Markets Policy Lead, Arushi Sharma Frank, was recently asked to testify at a Public Utility Commission of Texas Open Meeting. A...

Copyright © 2021 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.