US Electricity
Figure 7: Likelihood of Investments vs. Most Potential Impact (IOU respondents only)
will have a dampening effect on the momentum for change. Investment:
Near-term, Source: Black & Veatch
results imply that Smart Grid investments fall within the same class as alternative fuels and renewable generation, which means they will be limited to instances where Federal and State programs make the economics viable. Over the time horizon of the AEO 2010
renewable energy investment themes will continue to have a high profile as they did in 2009. These trends will slow once the true cost and reliability impacts of interruptible resources are coupled with cost and technical viability of large-scale electricity storage. Nuclear development will slow due to high projected costs – discussions regarding nuclear waste disposal will re-emerge
forecasts it is likely that existing Federal and State programs will continue and expand, causing a shift to installing AMI and Smart Grid devices and adopting techniques embraced within the Smart Grid concept. The full survey can be downloaded at:
www.bv.com/Downloads/Resources/Brochures/rsrc_EMS_ BVStrategicDirectionsSurvey.pdf
2010 Predictions Reviewing past year performance is easy. Predicting the
future is more valuable. The following are predictions for 2010: Economic Recovery: Being a poker player, I will essentially
hold my hand from 2009. We are in this one for the long-haul. Rather than a recession, we should be calling this a global consumer de-leveraging. The economic decline has stabilised, but recovery can’t begin in earnest until individual consumers de-leverage their personal debt positions. This de-leveraging will be made harder by tax increases at the Federal, State and Local levels. Home equity values will remain far below peak for several years. At the same time, the need to increase savings and increase investments in individual retirement accounts will continue for several years. Climate Change Legislation: Climate change legislation
is unlikely to occur in 2010. EPA carbon regulations might surface but will be limited in scope and effect. The debate over the accuracy of data supporting the case for global warming, coupled with the economic impacts of limiting carbon emissions,
24
Natural gas will become a fuel of choice while prices remain low.
as new construction on a few plants is approved. New coal plant announcements will not occur until the load recovers. Carbon capture and sequestration and coal gasification technology will get increasing amounts of attention. Natural gas will become a fuel of choice while prices remain low. Infrastructure funds/investor-owned
utility joint ventures and public/private partnerships will grow as a solution for providing the large amounts of capital needed to address the necessary infrastructure investments. Production: Oil prices will continue to rise and might even
rebound to above a US$90 per barrel peak. The lifting of drilling moratoriums will put some new areas into an early development phase. Peak-Load (Electric & Natural Gas) Recovery: Load recovery
will trail the pace of economic recovery driven by the impact of broadly applied energy efficiency programs, new more efficient appliances, and better management of energy use. ■
Stephen A. Stolze is an Associate Vice President in the
management consulting division of Black & Veatch Corporation – a leading global consulting, engineering, and construction
company specialising in infrastructure development in the fields of energy, water and information. Mr. Stolze has designed and
implemented a number of large, complex strategic programs in which he assisted many energy and other types of companies respond to industry restructuring. E:
stolzesa@bv.com
T: +1 631.348.4090 ext. 204.
The opinions offered are those of the author and not official viewpoints of the company or its employees.
www.bv.com/consult
worldPower 2010
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