Digital technology is transforming modern life. Despite utility resistance, power distribution is no exception.


In a recent white paper, Boulder, Colo.-based Navigant Research identifies a number of trends converging to alter the landscape for power generation and distribution. The implications of this transformation are clear: Utilities will have to adapt to survive.


“The Energy Cloud: Emerging Opportunities on the Decentralized Grid” describes “an emerging energy cloud landscape,” which shares many characteristics with cloud computing, such as decentralization, openness, universal access, liberalization and ubiquitous digital technology.


The impact of these changes on the energy sector will be dramatic. For example, the rapid expansion of rooftop and community solar, microgrids and other forms of distributed energy resources (DES) will upend what the paper refers to as the “traditional hub-and-spoke architecture” of today’s power-distribution system. In other words, utilities won’t be the only game in town, and the methods they have relied on for distributing power cannot be taken for granted much longer.


According to the paper, the power grid of the future will increasingly rely on two-way energy flows. For example, consider the rooftop solar customer that generates and consumes power or a fully charged electric vehicle that, when not in use, acts like a remote storage device contributing power back into the grid. Other characteristics of the energy cloud include expanded use of energy storage, virtual power plants, demand response and advanced software.


The paper describes the energy cloud as “a far more dynamic, responsive, and democratized network” than the current system. It adds that utilities need to be more flexible and nimble if they want to survive in this changing marketplace. For those that are, the prospects are good. According to Navigant, the new market “provides opportunities for forward-looking utilities to capitalize on the rapidly changing landscape.”