Key Points

• The extraordinary supply boom in the U.S. from the shale revolution and the decision of OPEC not to cut production combined with flattening consumption in BRIC countries have had profound global implications for energy prices, electricity trends and emissions.
• The energy system of the future will see greater convergence between different parts of the market – between energy policy and environmental policy, energy networks and other systems, electricity and gas, and state-regulated distributed resources and central station wholesale and interstate resources.
• U.S. electricity demand is mostly flat, which means investments in new generation are ultimately about displacement and cannibalization, driven in part by environmental and renewable energy targets and policies.
• Technology and the focus on the user experience are increasingly eroding the incumbent utility business model, raising the question of how fast the core will shrink and whether the model can react with sufficient agility.
• The U.S. is in danger of losing its position of leadership and influence in nuclear energy and has a strategic choice to make: either design new policy tools or cede the market to China and Russia.