Many businesses aren’t fond of government regulations; they see them as restrictive. However, distributed energy providers tend to view it differently because regulatory decisions can create markets for them.
Yes, it’s strange and often confuses newcomers. But then, the electric power industry doesn’t operate under normal business rules. Distributed energy companies must compete with utilities. And utilities own the playing field as investor-owned monopolies with a guaranteed rate of return, a status that gives them near-invincible market power.
Utilities can (and have) swatted away technologies that threaten to displace their infrastructure, leaving innovators with no path to the market. Aware of this problem, regulators sometimes step in and chisel out a piece of the utility business and open it to competition, or at least demand that the utility consider alternative technologies. To win the contract, the new technologies must prove they are better — cheaper, cleaner, or more reliable.
Our story, After We Ditch the Gas Pipes, What Then?, looks at one such practice. Called the non-pipeline alternative, it’s being pursued, or at least explored, in several states and a handful of cities. In this case, regulators are looking for technologies to ease homes and businesses away from natural gas use. The story examines where and how non-pipeline alternatives provide opportunities for distributed energy.
Non-wires alternatives are a predecessor to the pipeline approach. In this case, regulators require that utilities consider technologies, typically distributed energy resources, that allow them to delay or avoid the construction of conventional electrical infrastructure, like wires, poles, and substations. Arizona, California, Connecticut, Maine, Minnesota, New York, Rhode Island and Washington are among the states that have used this approach.
Many other programs and incentives are underway in North America to help new energy technologies make inroads into the utility-dominated electric industry. We’ll be writing about them here. Be sure to catch these stories as we post them by signing up for our free newsletter.
