Electric Utilities Industry Profile

Companies in this industry generate, transmit, and distribute electric power. Major companies include Duke Energy, Exelon, and Southern Company (all based in the US), as well as E.ON (Germany), EDF (France), Enel (Italy), and TEPCO (Japan).

The global electricity industry generates about 25 trillion kilowatt hours (KWh) of electricity. Leading countries in electricity generation include China, the US, India, Russia, and Japan. Unmet demand in parts of India and Africa is helping to fuel industry growth.

The US electric utilities industry includes about 10,800 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $475 billion. Major segments of the electric utilities industry, including electric power generation and electric power transmission, are covered in separate profiles.

COMPETITIVE LANDSCAPE

Although deregulation has altered power markets in many nations, electric utilities often continue to operate as unofficial monopolies in a given service territory. A growing number of countries have deregulated or are moving to deregulate their energy markets, including Australia, Canada, France, Germany, Japan, India, Italy, Portugal, Russia, Spain, the UK, and the US. The intended purpose of moving toward a less-regulated electricity market is to decrease the cost of electricity by fostering competition among producers. One practical effect is the divestment of generation facilities by many investor-owned and government-owned utilities.

Profitability in the electric utility industry is determined by government regulations and fuel costs. Large companies have an advantage ...