IEM Blog

Outlook on Power - 2018 and Beyond

Tuesday, January 30, 2018


Scott Smith from Deloitte’s “Center for Energy Solutions” has just issued his outlook for power and utilities for 2018.  He sees an electric power industry that is continuing to be transformed by technological, regulatory, and competitive forces.

Whether it’s a smarter grid, cleaner energy sources, or greater customer choices, he believes that power and utility companies are going to look very different in just a few years. 

Key Drivers

Below are some of the key drivers of change that Scott sees coming our way in 2018 and beyond.

  • A changing generation fuel mix trend that continues – one where non-hydro renewables (e.g. wind and solar) nearly doubled in the past 5 years - and will keep on growing
  • Declining power prices will continue to help offset rising costs in customer bills
  • Distributed energy resource (DER) penetration may impact more aspects of utilities planning than any other trend
  • Many consumers and businesses are betting big on renewables despite federal uncertainty
  • Strengthened calls for resilience are beginning to translate into results
  • The commitment to reduce cyber and physical security risk is deepening

Transportation and Electrification 

Scott sees several bright spots on the horizon, especially in the areas of transportation and electrification.  They include:

  • In the transportation sector, the age of the electric vehicle (EV) is dawning as growth in parallel trends such as autonomous vehicles continues
  • US electric power companies have already taken the first steps towards digital transformation
  • A more diverse and decentralized network of lower capacity, more flexible units with intelligence to self-ramp, self-balance, and self-diagnose
  • Look for a future grid that will be a communications-enabled, self-healing network
  • Asset owners, prosumers, and consumers who will be able to price and trade energy among themselves in decentralized markets through a transactive energy system

 To read Scott’s full, in-depth report covering each of these topics, just click here.

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