Texas, United States -- The focus on the transition to renewable energy, energy efficiency programs and legislation surrounding these areas is spurring tremendous change in the utility industry. A lot of money and effort are being funneled to the research, development and deployment of clean energy technologies. The federal debate over fuels, technologies and the legislation supporting them has reached a fever pitch.
The utility industry is undergoing fundamental change. The extreme change sometimes envisioned-that utilities will disappear-is not likely. The future utility will almost certainly be a hybrid of centralized power plants and massive distributed generation, combined with a much more efficient system of both generation and consumption. But the business model of the utility and the relationship between utility and customer will be radically different.
Nearly every utility is aware of these looming changes; even those who have opposed this transition are hedging their bets by testing renewable generation and smart grid deployment. The elephant in the room that is being ignored by the utilities and the renewable energy community alike is that this new distributed generation is a significantly disruptive technology and the commodity-focused economics of America's 100-year-old utility industry is aging out. Few, if any, utilities seem to be working on finding a new business model that will successfully mitigate these twin threats.
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