It's been obvious for years now to those that utilities aren't coping well with distributed energy and two-way grids. Leave it to Elon Musk to bring that problem to light in the mainstream. This article talks about how he wants to get in the home battery market. Distributed generation, demand response, and energy storage are all going to hugely change the electric grid in the next few years. Utilities more than anyone are aware of the threat this is to their businesses, but the smart ones will adapt. The regulatory environment makes it pretty tough in some US jurisdictions, and I predict there will be some pretty high profile failures before its all over. It is increasingly obvious however, that the next utility model will be one of system minders and grid managers, rather than primarily builders of huge centralized power stations and one-way transmission/distribution networks. In the end, I think we can all benefit from this paradigm.
Manghani believes utilities aren’t doomed, but they may undergo a radical transformation, becoming something closer to service providers and minders of an increasingly distributed grid rather than the centralized power producers they are today. Such a system would require lots of batteries to help balance the load and supply extra power during peak times, which is why GTM estimates the market will grow from $48 million today to about $1 billion in 2018.