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Survey: New generation a near-term priority

13 May 2009 — Nearly 67 percent of U.S. utilities said new generation is a priority during the next 12 months. In the industry survey by PricewaterhouseCoopers utilities said they are focused on new generation to meet demand across all sectors and to strike the right balance to ensure environmental compliance. New generation will be a key driver to ensure consistent customer service and drive shareholder value.

Survey results were published in the firm’s report “11th Annual Utilities Global Survey 2009, World Beyond Recession.” Utilities said they are trying to balance themselves in a difficult economy while working to meet future electricity demand. Current challenges for the industry are difficult access to capital, rising costs and environmental concerns.

Nearly 58 percent of those surveyed said rate cases were a focus for the same time period. For the first time in many years, a large percentage of utilities are filing for rate increases, according to the survey. The combination of rising costs, expiring rate caps and increased capital investment requirements are driving these filings.

Over the long term, more than 90 percent of survey respondents agreed that big changes are on the horizon regarding carbon emission regulation. These changes will likely compel utilities to build new generation facilities, enter into new power contracts and update and/or build a compliant transmission infrastructure, according to the survey.

Greenhouse gas regulations in particular will be the biggest challenge facing the industry in the next five years, survey respondents said.

To help meet this challenge, surveyed utility executives said they would look toward increasing energy efficiency. Second on the list is investment in renewable energy.

Click here to download a full copy of the report.