What You Thought You Knew About the Electricity Business May Not Be True

by Bob Shively, Enerdynamics President and Lead Instructor 

The electric utility system has been relatively stable for a long time – longer than the careers of even the oldest in the business. That means it is easy to think that once you get a bit of experience and learning, you have things figured out. But lately, that assumption482469921 might be getting turned on its head. Here are few things that we’ve always “known” that may no longer be true.

  1. More renewable energy means less reliability
    Perhaps surprising to many, initial sets of data analyzing SAIDI (System Average Interruption Duration Index) indicates that Germany has maintained a high level of performance despite growing to more than 25% renewables in its power mix. More details.
  2. The utility business always changes very slowly

    Those of us who have been in the industry for a long time know that ideas frequently arise many years before they actually get implemented. It is simply part of the regulated way of doing business. So any discussions of the “utility of the future” must be just that, discussions about what might happen in another decade or so.  Except that regulators in Hawaii and New York are already holding proceedings that will likely result in radically different utility business models in the next few years. Listen to this NPR report for an example.

  3. The only way to economically store electricity is through hydro-pumped storage

    Yes, batteries and flywheels and other technologies have been around awhile, but other than for emergency backup, there just isn’t an economic case to be made for installing electric storage. In most cases that is still true today, but again, this might change soon. Tesla Motors is preparing to build a huge lithium ion battery factory in Nevada. Many believe they are significantly overbuilding for what is needed for car batteries (click here for an example). But this could lead to the price of batteries falling significantly as over-capacity floods the market. This is what happened to drive down the cost solar photovoltaic systems. And Tom Werner, CEO of SunPower recently stated “2014 for batteries feels a lot like 2003 in solar.”

There are other assumptions we might tackle in the future but this is a good start for one post. If you’d like to explore these and more, please join me in New York City, October 6-7, 2014,  for our Distributed Energy, Renewables and Microgrids seminar. And if you are interested hurry because the early bird discount that saves you $200 ends September 15.

About Enerdynamics

Enerdynamics was formed in 1995 to meet the growing demand for timely, dynamic and effective business training in the gas and electric industries. Our comprehensive education programs are focused on teaching you and your employees the business of energy. And because we have a firm grasp of what's happening in our industry on both a national and international scale, we can help you make sense of a world that often makes no sense at all.
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