More large corporations have decided that the electric power grid is unreliable and are planning to unplug from it and generate their own electricity.
The Wall Street Journal has confirmed a story that Off the Grid News previously reported – and the newspaper found the practice is even more widespread than previously thought.
Off The Grid News had reported that several large corporations, including Walmart, Safeway, Google, Bank of America and Coca-Cola, are spending hundreds of millions of dollars on systems to generate their own electricity. A Journal article indicates that many other large companies, too, are taking steps to generate their own electricity.
Electric companies are worried
The generation of electricity by private corporations has grown to such a level that it’s beginning to cause utility executives to worry, Journal reporters Rebecca Smith and Cassandra Sweet noted. They wrote: “The growing number of companies that are at least partially energy self-sufficient is sending a shudder through the utility industry, threatening its revenues and growth prospects.”
The two made the conclusion based on a report put out by the Edison Electric Institute. The Institute is a think tank for the electricity utility industry.
One of the main reasons large companies are looking into generating their own power is the fear that power outages will become more common. The aftermath of Superstorm Sandy, when large areas of the East Coast went dark, convinced many companies that the grid is unreliable, Rick Fioravanti, an executive at DNV Kema — a consulting company — told The Journal.
Journal Predicts grim future for the grid and home electric customers
Sweet and Smith made some troubling revelations about the power grid and its future in their article. These discoveries include:
- The widespread generation of electricity by private companies could drive up electric rates for homeowners and small business. They wrote: “State and federal regulators say they are worried that utilities could end up with fewer customers to pay for costly transmission lines and power plants.” That means your electric bill could go up when Google and Walmart unplug from the grid.
- The number of commercial and industrial facilities that have the capability to generate at least some of their own electricity has quadrupled since 2006. Federal statistics indicated that 10,000 such facilities could generate their own electricity in 2006. In 2013, 40,000 facilities had such a capability.
- The Kroger Corp. — owner of supermarket chains such as Ralph’s, Food4Less, Kroger and King Soopers — has invested in technology to convert food waste into biogas to power one of its distribution centers, saving it 20 percent on electricity a year. The gas will be made from food Kroger cannot resale and it even will power forklifts. It’ll be used to make electricity. The company plans to employ the technology at many of its facilities. At another location, Kroger is using wind turbines.
- Walmart currently produces 4 percent of the electricity its stores use. The retail giant which also owns Sam’s Club plans to produce 20 percent of its own electricity by 2020. Most of the electricity will be generated by rooftop solar panels.
- Other corporations installing solar electric units include: Costco, Kohl’s, Macy’s, McGraw-Hill, Johnson & Johnson, Staples, Campbell Soups, BMW and the Walgreen drug stores.
- Apple now generates 16 percent of the electricity it consumes using a combination of solar panels and biogas fuel cells. Apple has a data center in Maiden, North Carolina, that is completely independent of the grid. The center produces all of the electricity that it uses.
- Verizon is planning to install $100 million worth of fuel cells from companies like ClearEdge and Bloom Energy at facilities in 19 states.
The moral of the story is clear: Large corporations no longer think that the grid is dependable. A company like Verizon wouldn’t be spending $100 million on fuel cell technology if it didn’t think it was necessary.
Big rate increases could be coming soon
Yet there’s another reason why corporate executives are rushing to generate their own electricity. It’s because the cost of self-generating technology such as solar panels and fuel cells is falling.
The cost of solar electricity and grid electricity for Walmart will be about the same in three years, David Ozment, the retailer’s director of energy management, told The Journal. If that’s true, it’s safe to assume it might be cheaper for Walmart to generate all of its own electricity and simply disconnect from the grid at some point in the future.
If big companies like Walmart leave the grid, utility companies will have to raise rates on households and small businesses to pay for the system.
Perhaps it is time for families and small businesses to start learning from big business. Big business has realized the importance of maintaining a dependable and affordable source of electricity. Families and small businesses need to start doing the same thing.