But Frank Graves, a principal in the utility and finance teams at the Brattle Group, said current efficiency efforts won't deliver the type of results that federal energy and climate proposals demand.
"At some point they are going to say, 'This isn't going to make sense,'" Graves said. "We are pricing increasingly what looks like a fantasy. ... The mechanisms are set up to reduce, say, maybe 100 to 200 megwatts and some demand response that works fine. No one is going to freak out at that level. But 2,000 megawatts of load growth, then it starts to be more of a fistfight."
And electricity customers and politicians are likely to be unhappy when they realize that reducing power use does not necessarily mean electricity costs are going to fall, said Bob Grant, vice president of operational excellence at KEMA, an energy policy and technical consulting company.
"This was the dirty little secret in the 1970s," Grant said. "You can do conservation, but we are going to charge you more for it because there is still a certain amount of investment that has to be paid for by somebody. That plant investment has to be covered."
'Saving grace'
A big difference this time: Utilities have technology on their side, Grant said.
"The saving grace ... is your products are going to be more efficient, but there will be more conveniences around you," he said. "People will pay for that ... if they can use those kind of devices more efficiently and make their life better."
Helping consumers make better choices about their energy use through "smart grid" and other technologies could provide new opportunities for utilities -- maybe even make up for revenue losses, some experts say.
"I have run into some CEOs that think this is fantastic and want to move into the value-added end of services," Brattle Group's Graves said. "Others think of themselves in a passive way, more of a platform for services, and want to let the services play out on top of them."
Lovins, the energy efficiency advocate, said smarter utilities are already figuring out how to sell customers what they want before someone else does. "Utilities ... know their customers, are technically skilled and have huge cash flows," he said. "These assets can be redeployed in different ways at better costs, lower risks."
Many see this also as an opportunity to bring real competition to concentrated markets.
Beyond efficiency and energy management, utilities and independent parties are also starting to compete in distributed generation and demand response -- which are alternatives to the large central power plant.
While there is debate about how much of future energy supplies will be made up of small power sources -- typically, those of less than 100 megawatts capacity and usually of just 10 or 15 megawatts -- most experts say distributed generation will have a strong presence in the nation's future fuel supply makeup.
In most cases of distributed generation, a property owner buys the generation equipment himself and then consumes the electricity, selling any extra power back to the grid or offsetting any grid electricity he consumes. But buying and maintaining power equipment is prohibitively expensive for many homeowners and companies.
So utilities see an opportunity to generate electricity and meet renewable electricity standards -- possibly even getting emission-offset credits -- by renting rooftop spaces, installing their own equipment and owning the electricity that is generated. Southern California Edison and Pacific Gas & Electric Co. are each undertaking projects worth several million that involve the ownership of rooftop solar panels, and Duke also has a pilot program in North Carolina (Greenwire, Oct. 7, 2008).
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Reply | Report Abuse | Link to thisThere are plenty of ways for utilities to do the future. Those who won't change will die, sold to someone who can.
Facts are much home RE will soon be cheaper than utility power as one will pay under $10k for a lifetime of energy costs and will come standard on many new homes.
The tech is easy and already here. Ev's will be a big part of it by charging at night on cheap power and supplying it to the grid in the day, peak loads.
Generation will be far more eff. Instead of the 35% eff today in many plants, it will go to 55-70% eff cutting ever increasing fuel costs.
This transformation has been going on for some time. It's not as dramatic as the article suggests. More like incremental change. They will still be operating large centralized plants and selling kwh well into the future. Things wont' change that much. Economics will dictate.
Reply | Report Abuse | Link to thisJerryd
Reply | Report Abuse | Link to thisI'd like to know where you get the efficiency values of 55 - 70% for home generation. Wind power's maximum efficiency is the Betz coefficient (most energy that can be extracted from wind), and is 59.3%. Solar cells have a "maximum" efficiency of 20%.
The centralized plant efficiencies of 35% that you state pertain only to coal fired plants. Combined cycle gas turbine plants can have efficiencies in the 60% range; hydroelectric plants have efficiencies in the 85 to 90% range.
So, once again, what sources can you reference that state residential efficiencies will be in the 55 - 70% range.
GRAVITY, not CO2, causes Global Warming and Cooling.
Reply | Report Abuse | Link to thisThe air has EXCESS CO2. When the sun/solar insolation goes down at night then the amount of the GreenHouse Effect (CO2's delay by catch AND release, not trapping, of photons transported to space,) goes down, thus leaving EXCESS CO2 in the air. When the sun comes up, then more energy transport happens, the GreenHouse Effect (GHE) increases, more CO2 gets used., the temperature goes up. BUT it is the amount of outgoing energy that dictates how much of a GHE there is. The amount of CO2 is irrelevant as long as there is excess. Given that ALL the available (CO2 specific wavelength) energy is already transported by the CO2, then there is NO more available for the so called feedback processes in the global warming models. The excess CO2 must be there to transport energy when it is very hot ,such as summer, or the 49C/120F temperatures during the 2009 Australian bushfires (@385ppm CO2), or the world record 58C (Libya in 1922 -@280 ppm CO2).. So if hypothetically all the CO2 is used up at 58C then there is at least 40% excess today at the world average temperature of 16C/67F according to the Stefan-Boltzmann Law of Physics. Contrary to the IPCC CO2 models, adding more excess CO2 to the air can't cause warming unless you add extra energy. Limiting CO2 emissions by Cap & Trade just removes excess CO2. It will NOT change the temperature.
The real cause of global warming and cooling is the variable gravity/energy from planetary eccentricity as shown in "John Dodds Wobble Theory of Global Warming" (free summary, & full copy available at www.scribd.com).. The forces of gravity cause Earth rotation and winds and tides (moon or lunar gravity) and ocean and liquid core currents and friction and heat. The energy from Gravity is NOT addressed in the GCMs. Gravity also causes the magnetic field by the rotation of liquid core ions through a gravity field. Wind & tide power IS gravity power- where else does the energy come from? The variations in gravity are shown to correlate to the measured ice core temperatures for thousands of years, and to the 60 year cooling/warming cycles from 1880 to 1940 to 1998/9 and to the future 2028 temperature bottom and the 2058 temperature peak. Gravity explains warming AND cooling and is predictable. There will be a gravity spike on Earth in Oct 2010, due to the proximity of Venus and Jupiter. Adding the variable forces and energy of gravity to the Milankovitch Eccentricity (Timing) Theory allows it to overcome it's major deficiency of insufficient solar energy variation to explain ice ages. Gravity explains why the temperature can go up from 1970 through 1998, when the sole source of energy in IPCC models, solar insolation, was essentially constant. Gravity, which is much stronger than sunlight, supplies variable energy to drive warming and cooling. CO2 doesn't.
John Dodds
thanks for that 911 on the gravity involvement...I thought the article would broach the Cap & Trade issue, which seems to me to be a Hook & Crook way to allow utilities to raise their rates with that convenient excuse for a tax, which i'm sure if inacted, the market would provide some means to lever themselves against their own position by some sort of 'CO2 Credit' derivatives, which the big players would use to squash the little utilities and take them over. What a LOAD!
Reply | Report Abuse | Link to thisAnd if CO2 was the culprate, they've already gone past the tipping point...so why create additional fiscal hardship on the common folk with a new tax??
Hard to imagine this whole Cap & Trade wasn't cooked up with the help of the Fat Cats of Wallstreet.
I kept womdering when I was going to learn something new on SciAm. Thanks Dodds.
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