Disruption in power and energy utilities
The failing cost of wind and solar power technologies – with the declining cost of the storage system, have made renewable energy become more cost-competitive in generating electricity to conventional power plants. Their advancement presents serious threats to the existing power system as well as to the conventional business model of the power industry. As these clean energy technologies become affordable to the customer and easy to deploy as distributed generation, it could disrupt centralize and monopolistic structure of the country existing power supply system – moreover will causing stranded assets. This could lead to potential financial catastrophe and a threat to energy security.
To anticipate and address the challenges, government agencies and utility have to take some actions properly and systematically. IESR believes that it can be anticipated and addressed through reforming policy and regulation, improving medium and long-term planning towards low carbon power system, reforming power sector industry, and adjust utility business model, as well as promote more robust private sector investment. Nevertheless, those transformational changes require a political consensus of various stakeholders in the sector.
Country’s policy and decision-makers need to be supported with better knowledge and understanding of the current trends and its consequences. For this reason, IESR designed the Energy/Power Advisory work package as a support system to conduct robust fact-based research, modeling, and analysis of the energy and power system and policies. Thus, an informed decision based on accurate information, science and facts can be offered to the government agencies and utility.