New Administration, Rising Costs and Utilities

Deloitte recently issued an outlook report for power and utilities. With the new administration, as well as continued rising costs, it looks like the industry will continue to be in a state of transformation. The good news is that trends are emerging that will help to manage these costs. These trends include outdated infrastructure getting a facelift which will increase efficiency overall and continuing to modernize the grid with new technologies.

Enterprise risk management and operational risk is also a hot button for ratemaking decisions. Instead of considering all costs being equal, utilities and regulators are beginning to make decisions based on risk. This means decisions can be made about where specifically dollars in rate cases should go.

Lastly, there is a growing interest in what is referred to as a sharing economy. Collaboration with resources that are available “behind customers’ meters” is proving to add value for the overall system in terms of keeping costs down and establishing a grid that is more efficient, reliable and resilient.

 

Source: Deloitte

 

 

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