Italy, U.K. encouraged to invest in solar

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Research firm GlobalData is sharing a dim forecast of renewable subsidies and increasing oil and gas prices that will affect both energy consumers and utilities alike.

"Twenty-thirteen looks pretty grim for both energy consumers and utilities. Prices are sure to rise again for energy consumers, as both renewable subsidies and higher oil prices push electricity and gas prices higher across the continent," said Jonathan Lane, GlobalData's head of consulting for Power and Utilities.

Lane identifies the U.K. and Italy as countries particularly susceptible to future price increases.

"In the U.K., the government has introduced a new policy looking to simplify tariffs amongst the major utilities and a program to ensure that consumers are always on the best tariff," he said.

The verdict on how a tariff program for customers will work is still out, but Lane predicts that the endeavor will "probably prove impossible."

"In Italy, the government's focus is the better integration of Italian wholesale electricity and gas with the wider European markets in the expectation that this will reduce Italian wholesale energy prices to the levels found in other European countries."

Lane believes a large-scale shift in focus to solar power generation would alleviate some issues.

"Now is the time to invest in Italian solar, and utilities should be engaging with customers to fit and manage the panels alongside supply contracts. Indeed, it is possible that solar PV starts to lower electricity prices in Italy post-2014."

And this is good advice to international and North American utilities alike. "Utilities…will need to consider how to make money out of energy efficiency rather than selling kWhs, and will need to do this more quickly than they might have anticipated, Lane said. "A move to energy services, where utilities make money saving energy rather than selling energy, is the key transition that utilities need to make this year."

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