Utilities have a role in incentivizing distributed energy resources to lighten the grid's load.
- Jun 24, 2022 1:08 am GMT
Distributed energy resources are not only going to play a major role in decarbonizing energy grids across the world, but will also play a critical role in relieving pressure off the grids by distributing load and demand.
However, the grid cannot be decarbonized or relieved of demand pressure on the backs of well-heeled energy customers who can afford an at-home solar array, electric heat pump or a new home in a microgrid subdivision. Major progress cannot be made in this area until the industry figures out a way to get low and moderate-income households to buy into DER technology.
This burden has been mostly placed on governments. Government-backed loans are the most common subsidy that helps would-be consumers overcome the upfront cost. However, these loans are not proving as effective, and the government is not the only one to benefit from an electrified energy system. Utilities do as well and will have an important and enlarged role to play in ensuring enough customers not only can but are also willing to adopt load-reducing and decarbonizing technology.
A good example is the wave of electric vehicles expected to come on the market in the next decade. In order for utilities to get the most out of this wave, homes and businesses need to be outfitted with bi-directional charging ports. A study recently published in the Nature Energy Journal found that almost 40% of homes in PG&E's and Southern California Edison's service areas in California lived in homes that were too small or too old to adopt level 1 EV charging ports, and 64% of homes were too small or old to adopt level 2 EV charging ports.
These are significant barriers that will require significant dollars to fix. To rely on the government to solve this problem with loans and subsidies is to accept a solution at the slow pace of bureaucracy. The current reality says that pace is unacceptable, especially in order to reach the climate and decarbonization goals set for the next two decades. The private industry, which stands to benefit greatly from a relieved and electrified power system has a major role to play in speeding up adopting through grant and loan programs of their own, especially programs aimed at lower income households.
There are examples of this, such as Detroit Edison's agreement to make investments on EV charging stations but examples such as this are far too uncommon at this point. Have you heard of any examples of utilities stepping up on loans and grants for electrification? Please leave those examples in the comments as I want to collect as many case studies as possible.
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