“Digital technologies are making it easier for utilities to bring renewable resources into the grid,” says Ganesh. “These technologies will increasingly make it an economically sensible proposition for utility companies to integrated distributed generation sources, powering a Local Energy Marketplace (LEM).” Excerpts:
Utility companies have mastered integrating solar and wind, the main utility-scale renewables, into the power grid. Integrating distributed renewable resources--such as rooftop solar, Tesla Powerwalls, micro CHPs – is still a challenge. Business models built on the LEM can give established utilities new sources of revenue and flexibility to compete with new players in the industry.
Integrating distributed resources to the grid will require a hyper-local strategy that encompasses local generation and consumption characteristics. In turn, hyper-local strategy enables the LEM business model.
Other industries have found that supply chains and logistics originally centralized for scale and efficiency can successfully take on a hyper-local character. Naturally, the energy markets have their own requirements: storage challenges, service reliability, and social and economic impact. Still, evidence is mounting that LEMs are viable and could prove to be the disruptive innovation that reshapes the utility industry.
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