Electric Power Utilities Face Issues

It doesn’t sound like a piece of cake to be a CEO of a power utility. Sure, as we have discussed elsewhere, there are ways to lock in and hide profits, while staving off the world’s insistence that we migrate to renewables. But there are a great number of issues that make life extremely complicated for these folks.

Demand is declining, as technologies for energy efficiency and smart grid begin to reduce the overall consumption of kilowatt-hours.

Even the small incursion of renewables (especially solar) means reduction of on-peak (highest-rate) billing

Utilities will soon be in competition with the oil companies, as people begin to plug in their cars.

Most of the states have done a fairly decent job at legislating Renewable Portfolio Standards (RPSs) that force utilities to cut Power Purchase Agreements (PPAs) with solar and wind developers.

Overall: times must be fairly interesting at the utilities.