Utilities still have a long way to go to construct coherent solar strategies

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They say the first step to solving a problem is recognizing you have one. In the case of utilities’ often haphazard policies toward distributed generation resources like solar, however, that doesn’t seem to be the case.

At least that’s what the latest research E Source suggests. The marketing firm released its initial Utility DER Strategy Benchmark report, and it is highly critical of utilities’ approaches to creating polices to engage emerging electricity-generation technologies.

“None of the utilities included in the study believe they currently have a robust and integrated distributed energy strategy,” says Alanya Schofield, senior director of strategy, consulting, and products at E Source. “About two-thirds of utilities are developing and implementing narrow and disjointed efforts, but they’re hampered by the lack of a clearly defined DER strategy, internal resistance to change, and limited dedicated resources.”

While most utilities anticipate an ever-increasing amount of distributed generation coming online in the next seven years, they are still not making progress on strategies, Schofield added.

The study also suggests the biggest gaps include consideration of business model and regulatory evolution, customer experience analysis and planning efforts, and industry partnerships.

“These are critical elements of any successful DER strategy, and many utilities are not putting enough resources into these areas,” says Nick Lenssen, senior advisor at E Source. We’re optimistic, though, that utilities will make significant progress in strategy development, given near-term plans to expand many of their current customer-centric DER efforts such as programs and offerings, educational resources, and technology pilots.”

Key findings from the benchmark study include:

  • A solar perception gap. Utilities believe that they’re perceived as more supportive of solar than they actually are. Nearly two-thirds of utilities believe their residential customers would agree that their “electric utility supports its customers’ use of solar energy.” However, E Source research reveals that less than one-quarter of residential customers actually agree with this statement.
  • Lagging customer experience efforts. The majority of utilities stated that “improving customer satisfaction” is an extremely important driver of their DER-related strategy efforts, but less than half are currently including customer experience analysis and planning in their DER strategies.
  • Evolving DER-related organizational structures. Currently, the majority of utilities have limited budgets and four or fewer full-time employees dedicated to customer-centric DER strategy work. However, nearly all believe that staffing and budgets will increase in the next three years.