Accenture Consulting | June 2017:
Distributed generation is playing an increasingly important role in energy systems across the world, driven by the sustainability agenda, energy independence concerns and increasingly favorable economics.
There is overwhelming evidence that this trend will continue. We are seeing consumers showing growing interest in installing renewable generation — notably solar photovoltaic (PV) — in many markets around the world. Accenture’s New Energy Consumer research shows that, globally, 45 percent of consumers plan to sign up for rooftop solar panels in the next five years.
The result? Nearly six out of 10 utility executives believe small-scale and prosumer distributed generation will put greater stress on their networks’ future capacity than medium- or high-voltage connected distributed generation.
Strains on the network are not the only challenge facing distribution utilities. The rise of distributed generation is also eroding revenues and putting pressure on profitability, especially for vertically integrated utilities.
Furthermore, integrating more distributed generation brings risks, as it could result in lower volumes being
transported and higher network reinforcement costs.
However, given the criticality of distributed generation to facilitate the energy transition and the move toward more sustainable energy, this is not a movement utilities can afford to block or impede. Even if the political climate is temporarily changing to focus less on providing incentives for renewables in some markets, the momentum behind renewables remains powerful and building.
In short, the distribution business should be the catalyst for the integration of distributed generation and the progress toward the energy transition. Despite the challenges, the expansion of distributed generation also creates opportunities for distribution businesses to create services-based business models that could drive much-needed new revenue.
Overall, moving to smarter distributed generation integration is non-negotiable. The question is not if, but when.
And we believe the time is now.
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