Abstract

A dramatic restructuring is under way in the North American electric utility industry. The structure of vertically integrated utilities operating in protected territories will be replaced by one of “value networks.” We examine the regulatory, market and technological forces leading to the new industry structure. We describe five major changes that we believe will result as the industry becomes more competitive and customers have choice. We discuss how these changes will result in six industry segments: generation, transmission, distribution, power markets, energy services and information technology-based products and services. Then we explore what utilities must do to move from vertical integration to value networks.

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