BV: Utility leaders losing faith in future of coal, but liking solar

A report from Black & Veatch said that the way the electric utility industry operates is beginning to shift thanks to factors such as renewable energy growth, water supply issues and changing beliefs in the future of coal-fired generation in the U.S.

The report, “Strategic Directions in the U.S. Electric Utility Industry Report,” is based on an industry survey and analysis. It said that economic and environmental regulations will remain the primary motivator for utility leaders’ investment decisions, and electric customers will pay for those changes through increased rates. More than 65 percent of utility leaders said customer rates increased in the past year, and more than half said they believed rates will rise “significantly” because of environmental compliance rules.

In the U.S., carbon emissions legislation is the industry’s top environmental concern, followed by water supply. However, in Texas, water supply is the top concern because of drought conditions.

More than two-thirds of respondents said that renewable energy could provide benefits in the form of customer and regulatory relations, investment incentives and future revenue generation. More than 40 percent of utility leaders have begun to modify their service models to account for distributed generation resources, such as rooftop solar projects. Additionally, solar is the top-ranked traditional renewable technology for the second year in a row, the survey said, and was the top-ranked renewable technology in all geographic regions of the U.S.

Utility leaders feel that there is less of a future in coal-fired generation. In 2011, 81.5 percent said they believed there is a future for coal in the U.S. “when fiscal realities are fully considered.” This year, less than 60 percent believe that statement.

“The combination of a persistently sluggish economy, growing environmental concerns and uncertain regulatory outcomes, is creating the greatest earnings pressures in recent memory,” said John Chevrette, president of BV’s management consulting division. “Moving forward, utility leaders must balance the competing needs of sound financial performance and increased regulatory requirements while striving to exceed customer expectations.”

Read more business policy news

Sponsored by FLSmidth
Recommend this article Recommend this article () You recommended this article You recommended this article ()
Follow Power Engineering on Twitter

Products Showcase

Dynamic Fluoride Ion cleaning DFIC of industrial natural gas turbines Hi-Tech Furnace Systems

Dynamic Fluoride Ion Cleaning of IGT Parts

The Dynamic Fluoride Ion Cleaning (DFIC) Process from Hi-Tech Furnace Systems is able to clean deep, narrow cracks of oxides by cycling between negative, atmospheric, and positive pressure.

Latest News

Shutterstock coal production trucks

Weekly Coal Production

The Weekly Coal Production shows how much coal is being produced across the U.S.

Federal Reserve Bank of Dallas Weekly Economic Indicators financial business

The Federal Reserve Bank of Dallas' Economic Indicators

The Federal Reserve Bank of Dallas offers a glimpse into how the markets are doing domestical...

Kvaerner awarded contract for gas-fired power plant in Delaware

Kvaerner North American Construction Inc. and its joint venture partner, Parsons Brinckerhoff...

Canadian Solar purchases two solar projects

Canadian Solar Inc. has acquired a majority interest in two utility-scale solar power project...

Operators Restart Unit 2 at PPL Susquehanna

Unit 2 at the PPL Susquehanna nuclear power plant near Berwick, Pa. resumed generating electr...

Settlement agreement limits cost recovery at Edwardsport

The Indiana Utility Regulatory Commission (IURC) on Dec. 27 modified and approved a settlemen...

Toshiba in talks to sell portion of Westinghouse nuclear unit

Toshiba Corp is in talks  to sell up to 16% of its stake in the Westinghouse Electric Co...

Utah nixes nuclear waste storage facility

Plans to park radioactive waste at a storage facility in Utah have been officially called off.

Archived Articles

2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013

Power Engineering Current Issue

03/01/2014
Volume 118, Issue 3
1403PE-cover

Power Industry Wire News

Freedom Energy Holdings Inc. Presents ELAS Prototype Demonstration for Engineering Execs; Michigan Government Officials

Freedom Energy Holdings Inc. Presents ELAS Prototype Demonstration for Engineering Exec...

FuelQuest Announces GRAIL 2014 Conference Speakers

FuelQuest Announces GRAIL 2014 Conference Speakers

Vista Partners Updates Coverage on Power Solutions International, Inc. (NASDAQ: PSIX); Price Target Raised to $110.00

Vista Partners Updates Coverage on Power Solutions International, Inc. (NASDAQ: PSIX); ...

Ultra Electronics USSI and Liquid Robotics Announce the Development of Long Duration, Maritime Security Solution

Ultra Electronics USSI and Liquid Robotics Announce the Development of Long Duration, M...

Ceres Police Department Selects Zero Motorcycles as Their Electric Motorcycle of Choice

Ceres Police Department Selects Zero Motorcycles as Their Electric Motorcycle of Choice

Power Engineering

Article Archives for Power Engineering Magazine

Continuing Education

Professional Development Hours

To access a course listing associated to a specific topic listed below, click on the topic of choice from the list below.

Latest Energy Jobs

View more Job Listings >>