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Distributed generation threatening utilities? How can they respond?

Last year, NV Energy, a utility covering the US state of Nevada, found itself embroiled in a confrontation with its solar energy customers over fees distributed energy generation (more simply ‘Distributed Generation’ or DG). In January this year, the company offered them a compromise. The company, which is owned by Warren Buffett’s Berkshire Hathaway Energy, has announced it will submit a proposal to the state regulator that will allow customers who already own solar panels to avoid new fees over the next 20 years. These fees became effective earlier this year and are highly controversial. They would still be levied against new solar energy customers. Nevada Governor Brian Sandoval argued that people who don’t own solar panels are paying more than they should for grid maintenance and interconnections while solar panel owners enjoy the benefits. NV Energy and the PUC take the same view.

This is just one episode in an ongoing struggle in which utilities all over the world have been trying to cope with the growing popularity of distributed generation technologies, often based on renewable energy such as solar power, which is enabling more and more people to generate their own power rather than relying on supplies from utilities.


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