Consumer, Prosumer, Prosumager: How Service Innovations will Disrupt the Utility Business Model

Front Cover
Consumer, Prosumer, Prosumager: How Service Innovations Will Disrupt the Utility Business Model
Copyright
Contents
Author Biographies
Foreword
First, Infrastructure Changes
Second, Market Changes
Third, The Digital Frontier
Preface
Introduction
Part 1: How Service Innovations Are Leading to Consumer Stratification and Disruption
Chapter 1: Digitalization of Energy
1. Introduction
2. Digitalization in the Electricity Sector
3. How Will Digitalization Impact the Electricity Value Chain and Why Will Retail Face the Most Disruption?
4. How Will Future Digital Energy Companies Make Money?
4.1 Charging for Access to the Grid
4.2 Bundling Electricity With Other Services and/or Products
4.3 Platform Business Models
5. Who Will Thrive in This New Energy Arena? Where Will the Major Threats Come From?
6. Conclusions
Chapter 2: Peer-to-Peer Trading and Blockchains: Enabling Regional Energy Markets and Platforms for Energy Transactions ☆
1 . Introduction
2 . The Evolution of Peer-to-Peer Energy Trading and its Context in the Energy Transformation
3 . Distributed Ledgers as an Enabling Technology for P2P Trading
4 . Elements of Peer-to-Peer Trading, Regional Energy Markets, and Platforms for Energy Transactions
5 . Risks, Barriers, and Challenges of Blockchain-Based P2P Trading
5.1 Technological Challenges
5.1.1 Performance
Throughput and Scaling
Latency
Energy Intensity
5.1.2 Security/Privacy Challenges
Security
Privacy
5.1.3 Usability/Standards
Usability
Governance of Platforms and Token Systems
Standard
5.2 Legal, Policy, and Social Challenges
6 . Conclusions
Chapter 3: Integrated Energy Services, Load Aggregation, and Intelligent Storage
1 . Introduction
2 . A Primer on Integrated Energy Services, Load Aggregation, and Intelligent Storage
3 . Case Study: Stem 1
4 . Other Businesses, Other Business Models
4.1 Advanced Microgrid Solutions (AMS) 6
4.2 Sonnen 11
4.3 Tesla Energy 14
4.4 Engie Storage 16 (Previously Green Charge)
4.5 EnerNOC 17
4.6 CPower 19
4.7 Enphase Energy 22
4.8 Charge Point 23
4.9 eMotorWerks 24
5 . Conclusions
Chapter 4: Service Innovation and Disruption in the Australian Contestable Retail Market
1 . Introduction
2 . Imperatives for Change
3 . Key Trends in the Electricity Market Transformation
3.1 Distributed Generation
3.2 Battery Storage and Electric Vehicles
3.3 Digitization of Services: Smart Meters and the Connected Home
3.4 Sharing Economy and Other Emerging Retail Services
4 . Response to Technology Disruption: “Disrupting the Disruptors”
5 . Disrupting the Regulatory Landscape
6 . Conclusions
References
Chapter 5: Do I Have a Deal for You? Buying Well in Australia’s Contestable Retail Electricity Markets
1 . Introduction
2 . Background
2.1 Industry Structure and Institutional Arrangements
2.2 Distributed Energy Resources
2.3 Network Tariffs
2.4 Retail Offers
2.5 Network Tariff Regulation
3 . Relevant Literature
4 . Complexity of Retail Tariffs
5 . Conclusions
References
Chapter 6: Platforms to Support Nonwire Alternatives and DSO Flexibility Trading
1 . Introduction
2 . The Value of and Barriers to Distribution Networks Transition
2.1 The Value of Running a Smarter Grid
2.2 Incentivizing Nonwire Alternatives
3 . Evolution of Distribution Networks
3.1 Local Peer-to-Peer (P2P) Trading
3.2 Missing Incentives
3.3 Incentivizing More Efficient Local Balancing Through Network Charges
3.4 Solving Networks Constraints Through DSO Contracts for Flexibility
4 . Case Study: Piclo Flex
4.1 Why Flexibility Platforms?
4.2 What Functions do Flexibility Platforms Perform?
4.2.1 Step 1: Online Marketplace
4.2.2 Step 2: Real-Time Operations
4.2.3 Step 3: Post-Event Settlement
4.3 The Value of Piclo Flex
5 . Conclusions
References
Chapter 7: Consumer-Centric Service Innovations in an Era of Self-Selecting Customers
1 . Introduction
2 . Widening Set of Energy Choices
2.1 Consumer Energy Products
2.2 “Value-Added” Services
3 . Consumer Decision-Making Process
3.1 Five Stages of Consumer Decision Making
3.2 External Stimuli
3.2.1 Marketing Influences
3.2.2 Group Influences
3.3 Behavioral Process
3.3.1 Information Sensitivity
3.3.2 Individuality
3.3.3 Rational and Economic Decision Making
3.4 Decision-Making Biases
4 . Customer Engagement as a Key Focus for Utilities
4.1 Simple and Fast Services – Ohmconnect
4.2 Personalized and Customized Services – Wattcost, Opower, Bidgely
4.3 Integrated Utility Services – Powershop, Green Mountain Power (GMP)
5 . Conclusions
References
Part 2: How Regulatory Policy Will Impact the Evolution of Services and the Speed and Spread of Disruptions
Chapter 8: Fair, Equitable, and Efficient Tariffs in the Presence of Distributed Energy Resources
1 . Introduction
2 . Literature Review
3 . A Review of Economically Efficient Electricity Tariffs
4 . Allocative Equity, Distributional Equity, and Transitional Equity
5 . The Allocative Equity of Electricity Tariffs
5.1 Allocatively Equitable Tariffs Minimize Network Cost Shifts
5.2 Allocatively Equitable Tariffs Minimize Energy Cost Shifts
5.3 Allocatively Equitable Tariffs Improve Incentives for Efficient Network Utilization
6 . Distributional Equity
6.1 Efficient Tariffs Likely Improve Distributional Equity on Average
6.2 DERs Create Distributional Inequity With Flat, Volumetric Tariffs
6.3 Achieving Distributional and Allocative Equity
7 . Transitional Equity
8 . Conclusions
References
Chapter 9: New Distribution Network Charges for New Integrated Network Services
1 . Introduction
2 . The Need for Designing Efficient Distribution Network Charges
3 . Why Distribution-Level Coordination?
3.1 Complement Cost-Reflective Distribution Network Charges
3.2 Utilize End-Users’ Flexibility
4 . Distribution-Level Short- and Long-Term Flexibility Utilization
4.1 Short-Term Local Flexibility Mechanism
4.2 Long-Term Local Flexibility Mechanism
4.3 Short- and Long-Term LFM: Why Both?
5 . Conclusions
References
Chapter 10: Community Energy Storage: Governance and Business Models
1 . Introduction
2 . Community Energy Storage in Changing Energy Landscape
2.1 Community Energy Storage: A Complex Sociotechnical System
2.1.1 Technologies
2.1.2 Actors
2.2 Pathways for Community Energy Storage
2.2.1 Physical Local Community Energy Storage
2.2.2 Virtual Community Energy Storage
2.3 Local Energy Initiatives and Community Energy Storage
3 . Value Streams and Business Models for Community Energy Storage
3.1 Business Model Developments
3.1.1 Business Model Canvas (BMC)
4 . Regulation and Governance of Community Energy Storage
4.1 New Regulations for Energy Storage
4.2 Self-Governance and Ownership
4.3 Flexibility, Energy Price Signals, and Future Role of Grid
4.4 Local Energy Market, Exchange Platforms, and Locational Net Metering
5 . Conclusions
Acknowledgment
References
Chapter 11: Challenges to the Promotion of Distributed Energy Resources in Latin America: A Brazilian Case Study
1 . Introduction
2 . What Is DG?
3 . Examples of DG in LAC Countries
3.1 DG Policy Overview in Argentina
3.2 DG Policy Overview in Colombia
4 . DER in Brazil: A Paradigm Shift Taking Shape
4.1 The Brazilian Way of DG Regulation: Prosumers Only Lately Included
4.2 Regulation of Small-Scale Prosumption
4.3 Pilot Project on DRM
4.4 Energy Storage and Electric Vehicles in Brazil
5 . Conclusions
References
Part 3: How Will the Emerging Business Models of Incumbent Distribution Companies and Newcomers Transform the Electric ...
Chapter 12: The Future of Electricity Distribution: A California Case Study
1. Introduction
2. Challenges Facing California’s Power Sector
3. Factors Affecting Sales and Utility Cost Recovery
4. Impact of Community Choice Aggregation (CCA)
5. Reshaping California’s Electricity Landscape
6. Conclusions
Chapter 13: Using Flexibility Resources to Optimize Distribution Grids: A French Case Study
1. Introduction
2. Value of Flexibility for Public Electrical Distribution Grids in Continental France
3. Mechanisms for the Use and Valuation of Flexibility on a Local Scale
4. Coordination of Local Flexibility Services With the Existing National Mechanisms, and Possible Windfalls From Those ...
5. Conclusions
References
Chapter 14: Off-Grid Prosumers: Electrifying the Next Billion With PAYGO Solar
1 . Introduction
2 . The Off-Grid Market: A Snapshot
3 . Pay-As-You-Go Solar: Understanding the Business
4 . Electrifying the Next Billion
5 . PAYGO Solar: Key Challenges
6 . Conclusions
References
Chapter 15: Customer Stratification and Different Concepts of Decentralization
1 . Introduction 1
2 . Different Concepts of Decentralization: An Overview
3 . Regional Electricity Marketing and Peer-to-Peer Trading
3.1 Case 1: Local and Regional Electricity Products
3.2 Case 2: New Trading Platforms/Peer-to-Peer Trading
4 . Providing Localized Flexibility for the Market: The Example of Network Management
5 . The Impact of the Cell Concept as a New Key Structure of Electricity Systems, From a System as Well as Consumer Per ...
6 . Regional Distribution of Renewables
7 . Conclusions
References
Chapter 16: Designing Markets for Innovative Electricity Services in the EU: The Roles of Policy, Technology, and Utility Capa
1 . Introduction
2 . European Union Market Design and Policy Adaptation
3 . Technological Innovation and Development
4 . Distribution Utilities Business Model Adaptation Capabilities
5 . Conclusions
Acknowledgments
References
Chapter 17: How Incumbents Are Adjusting to the Changing Business Environment: A German Case Study
1. Introduction
2. Background on the German Electricity Sector: From Continuity to Disruption
2.1 The Golden Age: Electricity Utilities as a “License to Print”
2.2 Eve of Disruption: The Energiewende and the Three Ds
2.2.1 The Energiewende
2.2.2 The Three Ds: Decarbonization, Decentralization, Digitalization
3. The Strategy Space for Disruptive Change of the Incumbent Energy Suppliers
3.1 Strategies in the Previous Energy Market
3.2 Overview of “Creative Disruption” and Preliminary Results
3.2.1 E.ON-OldCo
3.2.2 RWE-OldCo
3.2.3 EnBW-OldCo
3.2.4 Vattenfall-OldCo
3.3 Moving Forward?
4. Case Study I: Disrupted Utility Business Models for RWE and E.on
4.1 Unbundling the Unbundling: The 2018 RWE-E.on Deal
4.2 Driving Considerations
5. Case Study II: Disruption at the Electricity – Transport Nexus Decentral Innovation in Electric Mobility
5.1 Energiewende and Electrification of Transport
5.2 German Postal Services Occupy a Strategic Niche: Electricity-Based Distribution Services
5.3 What Future for Big-4 Vehicle Manufacturers?
6. Conclusions
References
Chapter 18: Who Will Fuel Your Electric Vehicle in the Future? You or Your Utility?
1 . Introduction
2 . The EV Transition and Its Effect on Power Grids
3 . Electric Vehicles and Australia’s Energy Profile
4 . EV Batteries, Standalone Batteries, and RRS
5 . EVs: Adoption Future Trends
6 . Case Study: Australia’s EV Market
7 . EV Household/Grid Charging Regime Case Study
8 . Results of Survey on Charging Habits of EV Owners
9 . Conclusions
References
Chapter 19: Distributed Energy Resources in the US Wholesale Markets: Recent Trends, New Models, and Forecasts
1. Introduction
2. Overview of the US Wholesale Markets
2.1 Energy Market Designs
2.2 Ancillary Services
2.2.1 Frequency Regulation
2.2.2 Contingency Reserves
2.3 Resource Adequacy Requirements and Capacity Markets
2.4 Considerations for DER Wholesale Market Participation
2.4.1 Administrative Costs
2.4.2 Market Design Risk
2.4.3 Market Price Risk
2.4.4 Impacts of State Policies on the Wholesale Markets
3. The Historical Phases of Wholesale Market Participation by Distributed Resources
3.1 The Demand Response Model
3.2 The New DER Technologies and Resources
3.2.1 Variable Energy Resources
3.2.2 Limited Energy Storage
3.2.3 Aggregated DER
3.2.4 Potential Prosumer Models Which Incorporate DER
4. Current Status and Regional Forecasts of Distributed Energy Resources in the United States
4.1 Existing DER Capacity
4.2 DER Capacity by ISO
4.3 ISO DER Forecasting for Planning Functions
5. DER in Wholesale Markets and Other ISO Functions
5.1 Wholesale Market Participation Models
5.2 Participation in Energy Markets
5.3 Participation in Ancillary Services Markets
5.4 Case Study: Distributed Storage Resource Participation in the PJM Regulation Market
5.5 Participation in Resource Adequacy Requirements and Capacity Markets
5.6 Case Study: Categorizing DER Participation in the ISO-New England Wholesale Markets
6. Key Design Issues for Expansion of DER Participation
6.1 Further Development of Market Participation Models and Market Rules Relevant to DER
6.2 The Interface of the Wholesale Market With the Distribution System and the Role of the Distribution System Operato ...
6.3 DER Impact on ISO System Operations and Reliability
6.4 Multiple-Use Applications and Regulatory Barriers
7. Conclusions
References
Epilogue
Index
Back Cover