Articles
Companies

Home / NEWS / Study: Distributed generation represents a threat to utility revenues

Study: Distributed generation represents a threat to utility revenues

by Fatima De La Cerna on May 25, 2017


Utilities face the risk of revenue loss due to distributed generation [representation image].
Utilities face the risk of revenue loss due to distributed generation [representation image].

RELATED ARTICLES: Siemens, Bentley team up to digitalise utilities | Dubai: 2016 utilities consumption targets revealed | Qatar: Utilities demand due to increase by 6 to 8%

Research shows that utilities face the greatest risk of lost revenues from distributed generation (DG), including residential solar photovoltaics (PVs) and fuel cells.

Accenture’s Digitally Enabled Grid study, in its fourth year, surveyed more than 100 utilities executives across more than 20 countries, including the UAE and Saudi Arabia. 

The survey revealed that 58% of distribution utility executives are of the opinion that DG will cause revenue reduction by 2030. 

The concern is higher in North America and Asia Pacific than in Europe, due to the prevalence in these regions of vertically integrated utilities, which face the double impact of declining energy sales revenue and increased network costs to support reliable energy delivery.

The study also showed that 59% of executives believe the biggest DG-related stress on utilities’ network-hosting capacity will come from energy prosumers, who are driving small-scale DG. Meanwhile, 28% said it will come from medium- or high-voltage-connected DG, such as a large-scale solar plants.

Accordingly, 59% of the respondents said they are expecting grid faults to increase by 2020, due to more volatile uses of networks as triggered by the deployment of distributed renewable generation. 

The same percentage of respondents believe they will exhaust their DG-hosting capacity within 10 years, if they haven’t already. After that, they pointed out, accommodating new DG on the distribution network will require increasingly high capital-reinforcement costs. 

According to Accenture, in the face of such disruption, only 14% of distribution utilities have a very clear forecast of their potential DG network-hosting capacity. 

Stephanie Jamison, managing director of Accenture Transmission and Distribution, said: “The rapid evolution of the technology, better economics, and the growing accessibility and environmental appeal of residential solar photovoltaics have pushed distributed generation from the fringe to a mainstream factor on the grid.

“Combining solar PV with more economical options for battery storage, demand response, and energy efficiency will give consumers more power and require distribution utilities to provide more flexibility and different types of services.”



Advertisement




Articles
Companies