Here, at the beginning of a new year and a new decade, the energy industry continues to evolve. Let’s look at six trends Renewable Rayna sees shaping the energy industry in 2020 and beyond as power companies look to meet those challenges…
1) Distributed Energy Resources
Source: Today’s Power, Inc.
In recent years, renewable energy has been a phenomenon, and it shows no signs of stopping. In a nutshell, solar, wind, and hydro power are expected to continue to rise. It means that utilities will need to place more emphasis on their distributed renewable energy (DER) programs and offerings over time.
According to surveys conducted by Deloitte, consumers are putting pressure on energy suppliers for them to have more control over their energy.
“Surveys tell us, electricity customers, across residential, commercial, and industrial segments increasingly seek to save money, use cleaner energy sources, ensure resiliency, and gain more control over their energy use. And utilities, especially those facing rising state renewable portfolio standards (RPS) and corporate carbon reduction goals, seek more flexible resources to help balance the growing supply of variable resources such as wind and solar. They also seek to shave peak demand, avoid costs of building new generation and transmission, and further engage customers.” – Deloitte.
DERs are small-scale power generation or storage technologies that typically range from 1 to 10,000 kW. Examples include residential, small commercial, and community solar, and sometimes battery energy storage, that are, in effect, a means of decentralizing energy production.
In 2020, it is expected that more utilities will mobilize to create new business models that draw on the increased interest of their clients in green products and services – for example solar solutions, home energy management systems, charging packages for electric vehicles backed by an EV-specific rate plan for overnight charges, front-of-meter (FTM) and behind-the-meter storage, etc.
Such offerings demonstrate an increasing demand for utilities to provide outcomes and advice, not just a commodity.
2) Battery Energy Storage Systems
Source: Today’s Power, Inc. (Project: The City of Fayetteville & Ozarks Electric)
As renewable energy usage becomes in more demand, consumers are looking for less waste when it comes to their energy. This allows businesses, cities and utilities to promote more robust energy management. With wind power requiring a breeze, and solar not being very useful at night, battery storage is crucial for the future of renewables in our energy mix
In recent years, batteries have developed dramatically, with no sign of slowing. This is driven by the need for efficient storage and battery technology, which has resulted in rapid technological changes, with increased battery life and performance. With electric cars becoming even more common, this opens another potential avenue for profit, especially if the grid is already in place.
3) Achieving Grid Parity
Source: Caracas Chronicles
Grid Parity is the point when the cost of the alternative energy becomes equal to or less than electricity from conventional energy forms like fossil fuels. With distributed energy resources, such as Solar Power continuing to be increasingly popular throughout the nation, the energy supply in 42 states is expected to achieve grid parity by 2020. This is a pattern that will continue in the coming years and eventually become a parity across the country.
4) Energy Policy
Source: Arkansas Advance Energy Association (Arkansas Solar Access Bill Contract Signing)
In a world where policymakers and governments are positioning themselves politically by favoring either renewable or more conventional sources, future energy policies could be dictated by the balanced power of individual nations.
In the United States, growing efforts are being made by many city and state governments to decarbonize by reducing CO2 emissions. This has made renewable energy more popular and is causing a trend of becoming increasingly dependent on solar and wind power across the country.
This is partly tied to the grid parity trend, in that consumers are demanding greater access to environmentally friendly energy. While this currently only affects certain cities, the amount is growing, making it an ever-growing market.
5) A Changing Utility/Energy Workforce
Source: Today’s Power (Left to Right: Mark Cayce- General Manager of Ouachita Electric Cooperative and Keaghan Economon – Electrical Engineer for Today’s Power.)
The practical effects on the business continuity of retirements by baby boomers have long been noted by experienced demographers. The domestic energy industry acknowledged, before this trend began, that an aging workforce nearing retirement would be a particularly hard hit.
In recent years technology and customer preference has dramatically changed in the energy world. Due to the ability of diverse and talented candidates to make their businesses more attractive, companies must do more to assess precisely what skills are needed for your utility’s likely trajectory and secure that talent. While gender quotas and others can play a part, attracting these workers can take a lot more than that.
This could also mean a cultural shift in a business and perhaps in the industry itself. This requires the development of new behaviors, strategies and even attitudes. If this is done, an organization will start improving the entire workforce while improving diversity and inclusion.
With technology playing an even more important role throughout the industry, utilities and energy companies have had to switch gears and start focusing on technical hires.
While some skills are missing, several companies are offering training for new and prospective employees. Another way for businesses to resolve this lack of skill sets is by recruiting qualified applicants from other industries. While this may be somewhat hard, many in the energy sector have demonstrated it is beneficial to hire those in computer engineering, data programming and more.
The lifeblood of our lives, our economy, our health is electricity. It’s an exciting and constantly changing environment, and CEOs must seize every opportunity to impress students, graduates, and young engineers with the field’s opportunities, responsibilities, and values.
6) Electric Vehicle Chargers
Source: The Electric Cooperatives of Arkansas
Recently, Congress has retroactively renewed the Alternative Fuel Infrastructure Tax Credit (ITC). By installing public EV charging solutions, you are eligible for an EV charger rebate known as the Alternative Fuel Infrastructure Tax Credit. With this credit, a business’ electricity-related infrastructure and fueling equipment can receive a 30% tax credit up to $30,000.
The one-time income tax credit, available for a short time, is set to expire on the December 31st, 2020, but it is expected to cause a surge of electric vehicle charging station installations in the U.S. this year. Having the infrastructure in place to support them, this trend will bring about a bigger boom of electric vehicles in 2021.