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New 21st Century Power Partnership Report Describes Pathways for Power Systems Transformation

Monday, March 16, 2015

New 21st Century Power Partnership Report Describes Pathways for Power Systems Transformation

Solar photovoltaics and other renewable sources are gaining in popularity and decreasing in cost, necessitating changes to traditional power delivery systems and markets. Photo credit: Flickr/Activ Solar

As we reach the midpoint of the 2010s, numerous trends in innovation, finance, policy, and economics are converging to signal a pivotal moment for the power sector. Trends like dramatic cost reductions in solar photovoltaics suggest that the traditional model of centralized electricity delivery may soon give way to new modalities of energy supply governed by new market structures and regulatory frameworks. Indeed, regulatory changes are already in progress in many jurisdictions—such as Mexico, New York, and the United Kingdom—suggesting that a global transformation of the power sector is already under way.

Understanding and guiding the pathway of power system change is a difficult task for policy makers, one that involves complex decision-making across policy goals, technological systems, social contexts, and financial networks. This challenge is the subject of Power Systems of the Future, a new report prepared by the 21st Century Power Partnership (21CPP). Rather than centering the discussion on potential utility business models or regulatory frameworks—as has been captured in other reports—this report considers the transformation of the broader power system ecosystem. 

A Framework for Decision Making

Figure 1

Figure 1

Illustrative mapping of scenarios for emerging power systems. Names represent both examples in progress (e.g., Mexico Energy Reform) and institutions that have published reports on future scenarios (e.g., RMI).
How and at what speed will power system transformation unfold? The report, which is coauthored by preeminent scholars in power systems research, describes a typology for understanding the speed and extent of change in different power systems (Figure 1), describing four scenarios: adaptation, evolution, reconstruction, and revolution. For example, transformation may emerge slowly through incremental reforms (an adaptive pathway) or abruptly through “big bang” reforms (a revolutionary pathway). 

The report goes on to outline five pathways for transformation (Figure 2), each defined by different characteristics in policy and regulation, finance and the overall investability of the sector, and underlying technologies and power system designs.

Figure 2

Figure 2

Applicability of pathways, based on present status of power sector organization.

  • Next-generation Performance-based Regulation Pathway: In this adaptive pathway, vertically integrated utilities remain in a recognizable form, but evolve to prioritize delivery of value instead of minimizing costs.
  • Clean Restructuring Pathway: In this reconstructive pathway, new power market restructuring efforts are initiated, incorporating lessons learned from the past 20 years, and including design features to facilitate clean energy integration and system optimization. Hindsight is 20/20—and this reconstructive pathway brings hindsight to bear on restructuring and reform.
  • Unleashing the DSO Pathway: Distribution system operators (DSOs) are poised to innovate in order to drive clean generation deployment and power system flexibility. In this evolutionary pathway, regulatory and policy frameworks give clear signals to these DSOs, empowering them as the centerpiece for orchestrating distributed energy resources and low-voltage market functioning.
  • Bottom-of-the-Pyramid (BOP) Coordination Pathways: Accelerating energy access has been a chronic challenge for decades. New technology configurations and business models are opening up opportunities for innovative approaches to energy access, especially when linked to broader social development goals. In this context, two pathways emerge:
    • Adaptive Bottom-up Coordinated Grid Expansion.
    • Evolutionary Bundled Community Energy Planning strategies, leading to integrated, socially customized energy access solutions.            

Webinar Training

With these organizing principles in mind, power sector decision makers will be better positioned to proactively guide a transition to 21st Century power systems. The Clean Energy Solutions Center, together with the 21st Century Power Partnership (21CPP), hosted a no-cost webinar on 18 March 2015 that provided an overview of the report's key findings and included presentations on power sector transformation pathways in Mexico and South Africa. The webinar featured a panel of experts who contributed to the report, including Dr. Doug Arent of the 21st Century Power Partnership, Efraín Villanueva of the Secretaría de Energía de México, and Barry MacColl of Eskom Holdings, South Africa. The panel’s presentations were followed by an interactive question and answer session.

The presentations and recorded webinar are available through the Clean Energy Solutions Center website

About the 21st Century Power Partnership

The 21st Century Power Partnership is an initiative of the Clean Energy Ministerial focused on power sector transformation and grid integration of renewable energy, energy efficiency, and smart grid technologies. For more information and to view reports and publications, visit or contact