News

Thought piece in REW on what business electric utilities are in

High voltage transmission lines, Primm Valley, Nevada (source: flickr/ Stephen Hill, creative commons)
Alexander Richter Alexander Richter 13 Mar 2015

An interesting article published in Renewable Energy World last week, discusses the role and business of electric utilities and how they could evolve their business model.

In the past, I have been pushing the idea of our industry needing to rethink its business model. This applies to the model of project development, providing services, and essentially sell power.

Utilities have played an important role in development, and there was always the hope by new players entering the market, that things will move faster. That has not really happened. With the increasing decentralisation of the energy sector through solar panels, batteries and the likes, the role of infrastructure and transmission will change.

How does this effect the geothermal sector? Instead of developing power plants, connect them to a national grid and sell power to players who sometimes sit 100s if not 1,000s of kilometres or miles away, there are now efforts of finding customers that are willing to move to the location of the plants. A good example is naturally Iceland, that has been able to attract electricity intensive production to the country. Kenya is going a similar path by creating a special economic zone near its geothermal power plants at Olkaria.

But where does this leave the utlities, the KenGens, EDCs, Pertaminas and other companies?

In an interesting article published in Renewable Energy World last week, the author Mahesh Bhave, discusses that utilities should be “change makers” and work on “augmenting [their] revenues”.

While connecting it here mostly with internet services that could go along electricity transmission, it still provides some interesting points for thought.

Check it out here