In its recently published 13th survey of trends in the global power sector, PwC reported a strong consensus that the spread of distributed energy generation, including solar and other renewables, is transforming the business model for the power sector. 94% of power sector CEOs from all regions who completed the 2013 survey predicted "complete transformation" or "important changes" between now and 2030, with 90% of North American respondents in agreement.
The disruptive impacts on the business model are due mainly to lost revenue from residential and business customers that generate their own power. In addition to the financial hit from this reduced demand, some states require utilities to buy any excess power from renewable sources at market rates, further limiting the power companies' ability to recoup the costs of maintaining large-scale electricity generating infrastructure, which they must maintain as backup power sources, since distributed energy generation is typically an intermittent power source. Interestingly, the survey also reports that, despite these ominous cost trends, 82% of respondents see distributed power generation as an opportunity rather than a threat, signaling that savvy companies are moving to get into the distributed power business themselves or develop other strategies for adapting to these changes.
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