in News Departments > New & Noteworthy
print the content item

Electricity efficiency gains, demand side management (DSM) programs and distributed generation (DG) have reduced customer consumption and cannibalized traditional utility-supplied power, according to a Fitch Ratings report.

As a consequence, Fitch says it believes that utilities will have to include efficiency, DSM and DG as part of their product portfolio going forward.

The firm reports that the Energy Information Administration recently revised its forecast for retail U.S. electricity sales growth to 0.7% per year through 2040. Fitch expects substantial regional variance from the national forecast, with growth in the Southeast and Southwest.

Energy efficiency, whether mandated or promoted by favorable cost economics, continues to play a significant factor in dampening retail sales, as does net metering and DG, Fitch adds. In addition, Fitch notes that the economic recovery and expansion since 2009 has done little for electricity sales growth.

According to the report, low electricity sales growth will pressure unit costs and challenge the economics and benefits of future capital investments and rate design. As such, capital investments and rate design will need to be restructured as costs are allocated over a changing customer profile, Fitch says.

The firm states that the economics of energy efficiency are compelling, as the benchmark levelized cost of electricity used to compare the cost of energy efficiency programs is substantially less than all forms of conventional or renewable power generation. Fitch adds that efficiency is an effective tool in displacing new power generation, produces peak load shaving and avoids or at least reduces the highest-cost sources of electricity generation.


Hybrid Energy Innovations 2015
Latest Top Stories

Duke Energy Commits $500M To Major Solar Expansion In N.C.

The utility company says the investment will help further diversify its portfolio, as well as increase solar power for its North Carolina customers by 60%.


Sensus Issues Refund To SaskPower After Smart Meter Woes

As SaskPower continues to swap out its Sensus units following several meter failures, the two companies have reached an agreement in order for the utility to recover costs.


The Smart Utility's Guide To Choosing A Smart Meter

Electricity providers across North America are taking on grid modernization. This article outlines the myriad factors a utility should consider in order to select the best-possible smart meter.


DOE Report: U.S. Wind Power Prices Reach All-Time Low

According to the U.S. Department of Energy (DOE), wind power continues to play a larger role in the U.S.' energy mix and is the cheapest it has ever been in the country.


Survey Reveals What U.S. Consumers Expect From Their Utilities

GE's new survey measures Americans' views on the state and future of the grid, as well as how much extra consumers would be willing to pay for better power reliability.

Hybrid Energy Innovations 2015
S&C Electric_id176
Future Energy_id187
edf_id180