Edited by Rolf Wüstenhagen and Robert Wuebker
Chapter 8: Photovoltaic Business Models: Threat or Opportunity for Utilities?
Jean-Marc Schoettl and Laurence Lehmann-Ortega 1 INTRODUCTION The forecast depletion of major fossil fuels, combined with a growing concern for environmental issues has triggered an exponential growth of renewable energy over the past decade: it represented about 14 per cent of total global primary energy supply in 2005.1 Although worldwide installed capacity increased from 1.4 gigawatts (GW) in 2000 to 9.1 GW in 2007, cumulative solar energy production currently accounts for less than 0.01 per cent of this total. Even moderate estimates predict a 30 per cent market growth rate increase in the next 10 years. These exponential growth rates are characteristics of a market in its infancy and thus facing challenges common to all emerging sectors: competing technologies, potential shortage of raw materials and a high proportion of new entrants, stimulating fierce competition in a turbulent market. Thus, as in all radical new markets, the photovoltaic (PV) sector presents both opportunities and uncertainties. Although utilities are among the main players in the overall energy market,2 it is worthwhile noting that they play only a limited part in this exponential growth. At today’s low levels of market penetration, distributed, grid-connected PV is not a central concern, or even of great interest to most utilities. However, as PV market penetration accelerates, utilities will become critical stakeholders, driven primarily by concerns about grid operation, safety, and revenue erosion. Until now, utilities have mainly responded to regulators, who asked nothing more of them than that they help customers who want to purchase...
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