Distributed Generation and its Implications for the Utility Industry - 1st Edition - ISBN: 9780128002407, 9780128003800

Distributed Generation and its Implications for the Utility Industry

1st Edition

Authors: Fereidoon Sioshansi
eBook ISBN: 9780128003800
Paperback ISBN: 9780128002407
Imprint: Academic Press
Published Date: 23rd June 2014
Page Count: 552
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Distributed Generation and its Implications for the Utility Industry examines the current state of the electric supply industry; the upstream and downstream of the meter; the various technological, business, and regulatory strategies; and case studies that look at a number of projects that put new models into practice.

A number of powerful trends are beginning to affect the fundamentals of the electric utility business as we know it. Recent developments have led to a fundamental re-thinking of the electric supply industry and its traditional method of measuring consumption on a volumetric basis. These developments include decreasing electricity demand growth; the rising cost of fossil fuels and its impact on electricity costs; investment in energy efficiency; increasing numbers of prosumers who generate for some or all of their own needs; and market reforms.

This book examines the implications of these trends in chapters focusing on distributed and decentralized generation, transactive energy, the role of electric vehicles, any much more.

Key Features

  • Discusses the technological, business, and policy trends most impacting the electric utility sector
  • Provides an assessment of how fast and how soon distributed energy resources may make an impact on utility sales/revenues
  • Explores, through a series of international case studies, the implementation of strategies that may help retain the viability of the utility industry
  • Features contributions from a number of scholars, academics, experts and practitioners from different parts of the world focused on examining the future of the electric supply industry


Electric utility professionals, utility regulators and policy makers, academic and research organizations, technology start-up and investors in distributed generation, solar PVs, micro-grids, energy storage, engineers and business professionals interested in the electric power sector, electric utility investors and analysts

Table of Contents

  • Author Biographies
  • Foreword
  • Preface
  • Introduction: The Rise of Decentralized Energy
    • Historical perspective: Centralized generation and growing consumption
    • What has changed?9
    • The rise of disruptive technologies
    • Changing the fundamentals
    • Organization of the book
  • Part I: What is Changing?
    • Chapter 1: Decentralized Energy: Is It as Imminent or Serious as Claimed?
      • Abstract
      • 1 Introduction
      • 2 What Is Behind the Slowing Demand Growth?
      • 3 Rise of Renewables
      • 4 The Rise of DERs
      • 5 How Serious a Threat—or Opportunity?
      • 6 Conclusions
    • Chapter 2: New Utility Business Model: A Global View
      • Abstract
      • 1 Introduction
      • 2 What is the Global Perspective? Views from the Senior Management of Major Global Utilities
      • 3 What Business Models are Actually Being Employed and Who will be Successful in this New Market
      • 4 Conclusion
    • Chapter 3: Germany's Decentralized Energy Revolution
      • Abstract
      • 1 Introduction
      • 2 What Is Driving the German Decentralized Energy Revolution?
      • 3 Prosumer Empowerment: A Genuine Bottom-Up Movement
      • 4 Challenges and Unforeseen Consequences of the Feed-In Scheme
      • 5 Conclusions
    • Chapter 4: Australia's Million Solar Roofs: Disruption on the Fringes or the Beginning of a New Order?
      • Abstract
      • Acknowledgments
      • 1 Introduction
      • 2 Context
      • 3 Methodology
      • 4 Results
      • 5 Winners, Losers, and Consequent Questions
      • 6 Conclusions
    • Chapter 5: As the Role of the Distributor Changes, so Will the Need for New Technology
      • Abstract
      • 1 Introduction
      • 2 Value of the Grid
      • 3 The Advantages of Accommodating Local Generation
      • 4 Distribution System Technologies Needed
      • 5 Conclusion
    • Chapter 6: The Impact of Distributed Generation on European Power Utilities☆
      • Abstract
      • 1 Introduction
      • 2 The Challenges Facing the EU Electricity Sector
      • 3 The Impact on Major EU Power Utilities
      • 4 How are European Power Utilities Responding
      • 5 Conclusion
    • Chapter 7: Lessons from Other Industries Facing Disruptive Technology
      • Abstract
      • 1 Introduction
      • 2 Confronting Disruptive Technology
      • 3 ESI Response to the Rise of DERs
      • 4 Conclusion
  • Part II: Implications and Industry/Regulatory Response
    • Chapter 8: Electricity Markets and Pricing for the Distributed Generation Era
      • Abstract
      • 1 Introduction
      • 2 Pressures on Traditional Approach to Electricity Pricing
      • 3 Reform Proposals
      • 4 Unsolved Problems and Proposed Reform
      • 5 New Business Models
      • 6 Conclusion
    • Chapter 9: Transactive Energy: Linking Supply and Demand Through Price Signals
      • Abstract
      • 1 Introduction
      • 2 Defining Transactive Energy
      • 3 Transactive Energy to Balance the Power System
      • 4 Information Technology Underlying Transactive Energy
      • 5 At What Price Generation?
      • 6 At What Price Distribution?
      • 7 Conclusion
    • Chapter 10: Transactive Energy: Interoperable Transactive Retail Tariffs
      • Abstract
      • 1 Introduction
      • 2 What is TE?
      • 3 Current Retail Electricity Challenges
      • 4 How Will an Interoperable Transactive Tariff Work?
      • 5 Will an ITRT Work?
      • 6 Benefits of ITRTs
      • 7 A Future Transactive Electricity Business and Regulatory Model
      • 8 Conclusions
    • Chapter 11: The Next Evolution of the Distribution Utility
      • Abstract
      • 1 Introduction
      • 2 The Current State of the EDU
      • 3 A Vision for the Future Electricity System
      • 4 The Future Business of the EDU
      • 5 Conclusions
    • Chapter 12: An Expanded Distribution Utility Business Model: Win-Win or Win-Maybe?
      • Abstract
      • 1 Introduction
      • 2 Rationales for Limiting Diversification
      • 3 Not a New Story
      • 4 Loss of Market Does Not Mean Market Power Disappears
      • 5 Other Factors Mitigating Concern
      • 6 Subsidizing the Competition?
      • 7 Conclusion
    • Chapter 13: From Throughput to Access Fees: The Future of Network and Retail Tariffs
      • Abstract
      • 1 Introduction
      • 2 Economic Inefficiency of Existing Electricity Tariffs
      • 3 Other Reasons Why Utilities Are Considering Alternative Tariff Structures
      • 4 The Industry Response—New Tariff Designs
      • 5 Optimizing the Utility Response—Embracing Change
      • 6 Conclusion
    • Chapter 14: Industry Response to Revenue Erosion from Solar PVs
      • Abstract
      • 1 Introduction
      • 2 Understanding the Threat Posed by DERs
      • 3 Three Different Utilities, Three Distinct Approaches to Solar PV
      • 4 Lessons Learned and Policy Suggestions for Increased Solar Acceptance
      • 5 Conclusion
    • Chapter 15: Making the Most of the No Load Growth Business Environment
      • Abstract
      • 1 Introduction
      • 2 Five Major Factors Causing the Electric Sales Growth Slowdown
      • 3 Electric Utility Investment Needs are Also Unprecedented
      • 4 The Survival Toolkit: Four Strategies
      • 5 An Analytic Approach to Strategy Selection
      • 6 Three Tactics Regardless of the Specific Utility Strategy
      • 7 Conclusion
    • Chapter 16: Regulatory Policies for the Transition to the New Business Paradigm
      • Abstract
      • 1 Introduction
      • 2 Near-Term Issue: Transition Grid Models for Cost Recovery and Rates
      • 3 Medium-Term Issues Shaping the Regulatory Framework for Utility 2.0
      • 4 Conclusion
    • Chapter 17: Electric Vehicles: New Problem or Distributed Energy Asset?
      • Abstract
      • 1 Introduction
      • 2 The V2G Concept
      • 3 Modeling: Why “Macro” Uptake Figures Are Not Enough
      • 4 Detailed V2G Modeling
      • 5 Modeling Results: The Real Impact of V2G
      • 6 Conclusion
  • Part III: What Future?
    • Chapter 18: Rethinking the Transmission-Distribution Interface in a Distributed Energy Future
      • Abstract
      • 1 Introduction
      • 2 The Distributed Energy Future
      • 3 Two Models of the Future Transmission-Distribution Interface
      • 4 Model 1: Transmission and Distribution as a Single Integrated System
      • 5 Model 2: The Open-Access Distribution System Operator
      • 6 Conclusions
    • Chapter 19: Decentralized Generation in Australia's National Electricity Market? No Problem
      • Abstract
      • 1 Introduction
      • 2 Oscillating Demand-Supply Balance
      • 3 Rise of the “Gentailers”
      • 4 Challenges to the Gentailer Business Model
      • 5 Can Existing Business Models Survive?
      • 6 Conclusion
    • Chapter 20: What Future for the Grid Operator?
      • Abstract
      • Acknowledgments
      • 1 Introduction
      • 2 The Transformation of Today's US Electric Power Industry
      • 3 Introduction of Competition into the Power Sector
      • 4 Centralized or RTO/ISO Markets
      • 5 Scenario 1: Incremental Change with Increased RTO/ISO Centralization
      • 6 Scenario 2: Microgrids with Minimalist Grid Operator
      • 7 Conclusion
    • Chapter 21: Utility 2.0: Maryland's Pilot Design
      • Abstract
      • 1 Introduction
      • 2 Letting Utility Customers Say What They Want, And Paying Utilities When They Get It
      • 3 Letting Utilities Try First to Make the Future Work
      • 4 New Utility Revenue Streams from Customer-Side Investments
      • 5 Testing Automated Microgrids for Economics, Reliability, and Integration
      • 6 Electric Vehicle Charging
      • 7 Conclusion
    • Chapter 22: Turning a Vision to Reality: Boulder's Utility of the Future
      • Abstract
      • Acknowledgments
      • 1 Introduction
      • 2 Boulder's Green Heritage
      • 3 Implementing Boulder's Climate Action Plan
      • 4 Boulder's Energy: The Future Is Not What It Used to Be
      • 5 What’s “Broken” About the Current Model
      • 6 Envisioning the Electric Utility of the Future
      • 7 Where Boulder Is Now
      • 8 Conclusion
    • Chapter 23: Perfect Storm or Perfect Opportunity? Future Scenarios for the Electricity Sector
      • Abstract
      • 1 Introduction
      • 2 Plausible Global Futures
      • 3 Future Scenarios
      • 4 Insights for Stakeholders
      • 5 Conclusions
    • Chapter 24: Revolution, Evolution, or Back to the Future? Lessons from the Electricity Supply Industry's Formative Days
      • Abstract
      • 1 Introduction
      • 2 Ill-Lit by Moonlight: Remembering the Impact of Electric Light
      • 3 Electricity and the Shock of the Old
      • 4 Electricity and the Shock of the New: How the Business Model Evolved
      • 5 Here, There, and Everywhere: A Centralized or Decentralized Future?
      • 6 Conclusions
  • Epilogue
  • Index


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About the Author

Fereidoon Sioshansi

Fereidoon Sioshansi

Dr. Fereidoon Sioshansi is President of Menlo Energy Economics, a consulting firm based in San Francisco with over 35 years of experience in the electric power sectore working in analysis of energy markets, specializing in the policy, regulatory, technical and environmental aspects of the electric power sector in the US and internationally. His research and professional interests are concentrated in demand and price forecasting, electricity market design, competitive pricing & bidding, integrated resource planning, energy conservation and energy efficiency, economics of global climate change, sustainability, energy security, renewable energy technologies, and comparative performance of competitive electricity markets. Dr. Sioshansi advises major utility clients and government policy makers domestically and internationally on electricity market reform, restructuring and privatization of the electric power sector. He has published numerous reports, books, book chapters and papers in peer-reviewed journals on a wide range of subjects. His professional background includes working at Southern California Edison Co. (SCE), Electric Power Research Institute (EPRI), NERA, and Global Energy Decisions. He is the editor and publisher of EEnergy Informer, a monthly newsletter with international circulation. He is on the Editorial Advisory Board of The Electricity Journal where he is regularly featured in the “Electricity Currents” section. Dr. Sioshansi also serves on the editorial board of Utilities Policy and is a frequent contributor to Energy Policy. Since 2006, He has edited nine books on related topics with Elsevier.

Affiliations and Expertise

President, Menlo Energy Economics, San Francisco, CA, USA


"For readers of this journal this book contains some very valuable articles summarizing recent developments...At the end asking the question how relevant the changes in the direction of distributed generation are, the answer is not unambiguous."--Energy Research & Social Science, January 28, 2015

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