With electricity demand slowing, the model of continued growth that has kept public utilities in operation for the last century needs rethinking. David Roberts examines how utilities will need to change to suit the coming ‘century of electricity’.
The ‘regulatory compact’ by which utilities provides low-cost, reliable power in exchange for the right to be sole electricity providers was devised a century ago to allow for the construction of the United States’ electrical infrastructure.
But increases in energy-efficiency, distributed generation technologies such as solar panels, and the desire to reduce electricity use are a threat to power companies' “comfortable business model” of profitable investment and return. The utilities “do not like that one bit,” says Roberts.
“As a society, we need energy efficiency and demand response. We need distributed renewable energy. We need to cancel out future power plants and transmission lines. All those things are to the good, economically and ecologically,” Roberts argues. “We need a ground-up rethink of how utilities work, how they are structured, and how they can be reformed in a way that enables and accelerates long-overdue innovation in the electricity space.”
Read the full story: Utilities for dummies: How they work and why that needs to change
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