Drawing from his interest that I introduced previously, the backcasting methodology, Tarmo Mere, Segment Director for Electric & Gas at Trimble Energy, encourages utilities to consider their decisions and actions today, in order to gain a better tomorrow. “As for the technologies affecting the utility business, for example the solar power will evolve, and it will become more efficient and more affordable for households and companies alike,” he states.
Further, combining the alternative energy sources with the battery technology is likely to result in independent microgrids, which, in turn, will significantly affect the electricity distribution business. “Whether it’s a single household or several ones,” Tarmo explains, “they can be totally independent from the network because they are producing and consuming the energy at different times, so this will even up, and it provides a viable alternative for the traditional utility customers, so that they actually no longer need the distribution network.” The remaining question is how to store the energy well enough at daytime in order to consume it at night.
Food for thought: Cooperate - But Why?
Where the renewable energy sources are already used in countries where there are a lot of resources such as daylight or wind, it’s still a challenge in the northern regions. “The development of the technology will enable this also in regions where there is less light especially in the winter time. For the Nordic countries, I believe in 5 or 10 years - who knows - the technology will have matured enough for building up independent microgrids,” Tarmo continues. However, this is heavily dependent on the battery technology. “For example, for the solar power, we need to be able to store the energy when there is sunlight and consume it when it’s dark. When the technology evolves to this stage, I believe the solar power becomes a very feasible solution for the northern regions, as well.”
“If the network companies make big investments that are then never taken to use - someone has to pay for it.”
“Considering every participant in the game, whether it’s the regulator, the consumers, or the network companies, if they’re optimizing only from their point of view, there will be no overall optimal solution,” Tarmo reflects. Therefore, he encourages the utilities to take more role in the development and try to cooperate with the regulators more. “Providing the regulators both with the utilities’ understanding on the new technologies, as well as with insight on how they affect the utility business will allow the authorities to better adapt the regulation, making it more suitable also for the future needs. This kind of cooperation can lead to a better good in the society, I think,” Tarmo concludes.
Food for thought, indeed! What are your thoughts - are the utilities really threatened to be out of business? I’d love to find your comments on our LinkedIn page!
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