Advanced Energy Perspectives

This is one in a series of excerpts from the Advanced Energy Now 2019 Market Report, prepared for AEE by Navigant Research.

Revenue from Advanced Fuel Production grew to $160 billion worldwide in 2018, an increase of 11%, after bouncing back in 2017 from down years in 2015 and 2016. In the United States, Advanced Fuel revenue staged an even bigger comeback, reaching $33.4 billion in 2018 on 12% growth year over year. In the United States, that growth was led by Ethanol, which had declined sharply in revenue in previous years, and Biodiesel, while globally CNG and LNG used for transportation accounted for the biggest revenue gains over the past two years. The Compound Annual Growth Rate (CAGR) for global Advanced Fuel Production revenue over the 2011-2018 period was 5%, while in the United States compound annual growth was -4%.

Rate designs for distributed energy resources (DERs) remains a hot topic. States are taking different approaches, but some are better than others. Some states are making adjustments (typically reductions) to flat kilowatt-hour rates, such as net metering and buy-back rates, or adding/raising fixed charges that often focus exclusively on utility revenue without looking at DER from a total value perspective. DER can impose costs on the system, but it can also provide value, both to the utility and more broadly to the public, and rates and compensation should take both into account. In its continuing effort to comprehensively assess the value of DER and design rates accordingly, New York recently made some landmark adjustments that should provide fairer treatment for customers that have significant distributed generation facilities, such as combined heat and power (CHP) systems. The improved rate is also available as an option for all customers, including residential customers without DG, and is likely to be a good choice for customers with electric vehicles and certain types of DER.

This is one in a series of excerpts from the Advanced Energy Now 2019 Market Report, prepared for AEE by Navigant Research.

Advanced Transportation was the largest advanced energy segment worldwide in 2018 for the second year in a row, with an estimated $494.8 billion in revenue, up 2% from 2017 and 8% the year before. Since 2011, the Compound Annual Growth Rate (CAGR) of Advanced Transportation globally was 6%. At the end of 2018, over 5 million plug-in electric vehicles (PEVs) were on the roads worldwide. PEV sales are poised to enter a period of strong growth, driven by lower battery prices, maturing plug-in hybrid and all-electric powertrain systems, and a proliferation of new models. By the end of 2027, Navigant Research expects there to be 10 times as many PEVs on the road. In the United States, PEV sales are surging as well, with overall Advanced Transportation revenue growing 34% year over year and accounting for nearly one-third of U.S. advanced energy revenue growth in 2018. Since 2011, U.S. Advanced Transportation revenue has grown at a compound annual rate of 15%.

Do we really need another conference to talk about energy? On June 13, in Richmond, VA, AEE answered that question with a resounding “yes,” as we launched our first regional policy conference, Advanced Energy Now | East, an event to showcase our members and our systems approach to policy transformation, for the purpose of increasing market opportunities for advanced energy companies. In a day packed with panels and breakout sessions, the more than 170 participants heard government and industry leaders speak on topics of vital interest to companies involved in a wide range of advanced energy technologies.

This is one in a series of excerpts from the Advanced Energy Now 2019 Market Report, prepared for AEE by Navigant Research.

Of all the segments covered, the market for Electricity Delivery and Management products and services recorded the highest compound annual growth rate (CAGR) in the period 2011 to 2018 worldwide (12%); in the United States, CAGR was 4% over that time period. The year 2017 was one of the biggest for electricity delivery and management, recording 28% growth globally and 14% in the United States. While the market plateaued somewhat in 2018, with global growth at 6% and a slight decline in U.S. revenue, Electricity Delivery and Management products will continue to receive significant investment in the next decade. The fastest growth over the period has been in EV Charging Infrastructure and Energy Storage. These markets started at a low base, but revenue has multiplied eight-fold over the seven-year period, recording double-digit gains in 2017 and 2018 in both U.S. and world markets.