Smart grid technology, solar PV, evolving policy and the ever-increasing expectations of customers have given rise to what are known as energy "prosumers," a mashup of producer and consumer.  

These consumers seek to participate actively in the energy market. They're wielding their growing ability to control or shift their usage, or to produce (and even sell) their own power, in order to save money and help the environment. 

This year, Frost & Sullivan predicted that by 2020, there will be approximately 20 million residential prosumers in North America. 

The result, it says, is that "utilities and distribution service operators will introduce differing supply contracts, depending on grid usage by prosumers. Consumers will have more control over the amount of energy generated, stored, and distributed across the grids. Grid parity and energy storage solutions will be the key game changers in this market beyond 2020."

Here are six ways prosumers - and the businesses and technologies which support and empower them - are keeping utilities on their toes, challenging them to be more responsive and flexible than ever before.

1. They're spending big on smart-home tech. When homes can mostly operate as self-sufficient energy systems, utilities will no doubt lose customers. How smart is this stuff getting? For over a year in California, Honda's Smart Home U.S. program has been gathering data from 270 sources and produces enough solar energy to operate itself and a Honda Fit EV.

2. They want more distributed generation, a lot more. In April, the international certification body and classification society DNV GL noted "some utilities have been forced by public demand to address the integration of high penetrations of distributed generation to their transmission and distribution system," especially greater integration of solar and wind power. In other words, this is becoming an everyday thing. On the bright side, the pressure to add renewables and decentralize offers three reliability payoffs for utilities: opportunities for enhanced voltage regulation, demand ramping and load-shedding. 

3. They're increasingly viewed as a potential revenue source. Minnesota's "value of solar" tariff and Arizona's decision to allow two regulated utilities to directly lease customer rooftops for solar generation underscore the value that prosumers can offer to the utility business model.  

4. They're forcing utilities to streamline things. Accenture research shows that prosumers often prefer getting distributed generation products and services from utilities, but other service providers are gaining ground fast in this market. Reducing the channel and organizational complexity of working with utilities, and bridging internal utility silos, are critical.  

5. They're forcing utilities to get better acquainted with them. Utilities have come to realize they don't know as much about their customers as their competitors might. Compared to what a cable/telephone/Internet service provider knows about the preferences and behaviors of their customers, utilities still have a long way to go.

6. They're putting pressure on regulators to get hip to today's electric power trends.  At last year's Legislative Summit of National Conference of State Legislators, Kenneth Geisler, VP of Strategy for Siemens Smart Grid North America, observed that so far, U.S. utilities have been effectively barred from owning generation and storage assets at the distribution level. Geisler believes that utilities would invest more in these measures if they could more easily recoup those costs. Signs of progress are beginning to crop up. "Regulators are trying to design guidelines so that utilities can do more to incorporate more renewable energy onto the grid, and continue to evolve their operations and business with an increasingly prosumer market in mind," said Geisler.  

 

http://www.energybiz.com/article/15/10/6-ways-prosumers-are-changing-energy-landscape