Monopolies can be destroyed by law or technology. Changing its law in 1996, Pennsylvania is among the minority of states that ended the electricity generation, state sanctioned monopolies. Unlike in Georgia, Florida, Kentucky and most states where Big Government rules the electricity generation business, any company in Pennsylvania can generate electricity and sell its power to any willing retail consumer, thanks to Electricity Generation Competition and Customer Choice Act. Today, more than 2 million Pennsylvania customers have switched to competitive electricity suppliers for generation. www.papowerswitch.com.
But in Pennsylvania and every state the distribution of electricity to customers remains a state sanctioned monopoly. The law will not end that monopoly to your home or business, but technology will. It is not a question of if, but when.
The Edison Electric Institute, the trade association for America's investor owned electric utilities, issued a bland titled report that sounds the alarm! EEI itself says distributed generation technologies undermine the business model of the electric distribution monopoly. Solar is coming, and the grid trembles!
David Roberts describes what distribution utilities may do to slow the erosion of their monopoly.
Utilities that choose to fight distributed generation will find rising public resistance to their grid monopoly. Some may be able to slow but few will stop the erosion of their grid monopoly. Stopping the solar and distribution revolution that is already underway will be much like putting toothpaste back in the tube.
Instead of fighting the waves of distributed generation that are just beginning, the smart course for today's utilities is to use their assets to become tomorrow's leading suppliers of distributed generation, energy efficiency, and back up grid power. Currently only a handful of utilities are on this smart path.