RMI Report Predicts Demise of Existing Utility Business
Solar-plus-storage represents a fundamentally new paradigm, according to a new report “The Economics of Grid Defection.” While other distributed generation options still require some degree of grid dependence, solar-plus-storage provides an opportunity for customers to cut the cord to their utility entirely.
The report, coming from Rocky Mountain Institute, HOMER Energy and CohnReznick Think Energy, details the potential for appreciable customer defection from the electric grid in major markets by 2025, without incurring higher costs or lower reliability.
As the hybrid combination of solar photovoltaic and battery storage become cost competitive with retail grid electricity rates, migration of customers away from the grid could happen well within the 30-year planned economic life of typical utility investments such as central thermal generation plants and transmission infrastructure, say the researchers.
The continuing decline of solar PV and battery storage costs, coupled with increasing retail electricity prices, has resulted in grid parity today for commercial customers in Hawaii. The most optimistic projections, based on certain solar and efficiency targets being met, depict grid parity for millions of residential and commercial customers in New York and California within this decade.
Even before total grid defection become a reality, utilities will see further revenue decline since solar-plus-battery systems sized to meet most of a customer’s load will become cost effective sooner. In addition, other motivating factors such as customer desire for increased power reliability and low-carbon electricity generation are driving early adopters ahead of grid parity.
- Solar Request for Proposal (RFP) Guide
- 2015 Insider Knowledge
- It's Time for Today's EHS and Sustainability Professionals to Embrace Big Data
- Planning for a Sustainable Future
- Financing Environmental Resiliency and a Low-Carbon Future with Green Bonds
- 10 Tactics of Successful Energy Managers
- Energy Manager Today Awards Top Products and Top Projects of the Year
- 2016 Energy and Sustainability Predictions - Findings from Leading Professionals
- Shifting the Focus from End-of-Life Recycling to Continuous Product Lifecycles
- 2016 Environmental Leader Product & Project Awards