Navigating sustainability: New directions in industry relationships

The energy and utility industry is embarking on a period of profound and unpredictable change over the next several decades—with more radical advances than anything seen since the days of Edison and Rockefeller.  

The industry is on a long and winding road to sustainability. Deregulation, re-regulation, greenhouse gas (GHG) regulation, renewable resources, distributed generation, increased efforts for energy efficiency, and smart grid and advanced metering are emerging as enablers—and primary drivers—of significant change. Add to this the prospect of a major shift to an electric-fueled transportation sector, and the utility of tomorrow will be completely transformed.   

So how is the industry responding today to build the sustainable energy future? As the words from some of the key players in the US market make clear, the industry is forging new relationships with customers, partnerships with government and alliances with technology innovators.    

New directions in generation technology and policy    
The Hawaiian Electric Company (HECO) has been actively engaged in supporting and promoting transformative clean energy goals and technologies. In the Clean Energy Initiatives agreement with the State of Hawaii in 2008, HECO committed to increase renewable energy state-wide by 1,100 MW by 2030. This groundbreaking private-public initiative puts Hawaii on the path to transform its energy future.  

“This is a pivotal time for utilities—we must have the long-term vision to shape a clean energy future for the communities we serve,” said Dick Rosenblum, president and CEO of HECO. “The Hawaii Clean Energy Initiative is a clear example of how cooperative, engaged relationships between utilities, government, industry participants and customers can redefine our energy future. Together we are opening new opportunities to broaden strategic focus on renewable generation and energy efficiency and to develop the enabling smart grid technologies and regulatory frameworks.”   

Policies and technologies driving the ‘smart’ utility future
PJM Interconnection (PJM) is the regional transmission organization (RTO) managing the largest high-voltage electric grid in North America and the wholesale electricity market that serves all or parts of 13 states and the District of Columbia. PJM has been actively exploring and defining the evolving role of the grid operator in integrating new ‘smart’ grid and vehicle technologies and ‘smart’ policies needed to support industry transformation.  

“What makes a grid ‘smart’ is optimizing the assets connected to it – from the generator to the end-use device,” said Terry Boston, president and CEO of PJM. “One of the best examples of that is plug-in hybrid electric vehicles. When they recharge overnight, they can store off-peak wind power, and they can automatically work with the grid to provide regulation service, balancing demand fluctuations on the system. At the same time, widespread deployment of plug-in hybrids could reduce carbon emissions and dependence on foreign oil at the equivalent cost of buying gasoline at 60 cents per gallon.”  

Enabling informed energy use decisions   
Duke Energy has been at the forefront of implementing advanced two-way digital communications, renewables and energy efficiency technologies through its industry-leading smart grid program. The emerging smart grid, advanced metering infrastructure and Home Area Networking (HAN) are enabling consumers to make more informed energy use choices.   

“The Utility of the Future will change the relationship most utilities have with their customers as utilities adopt technologies customers have come to expect in every other aspect of their lives,” said David Mohler, vice president and chief technology officer with Duke Energy. “The boundary between the utility and the customer is shifting—and in the process, the customer is becoming the ultimate regulator.” 

Innovations in the utility–customer relationship
Advanced consumer-based technologies and applications also will change the way customers interact with their electric utilities. Online software applications will provide near real-time information on energy consumption. Smart appliances will make energy consumption more visible to customers. Combined with emerging HAN technologies, the utility customer of the future will be empowered to make more informed, efficient energy-use decisions.  

Google, Microsoft and Whirlpool each are developing advanced consumer products and applications to help people become better connected with their energy use. For example, Google is actively engaged in helping consumers better understand and manage their personal energy use.  

"Energy information helps people make smarter choices to save energy and money,” said Dan Reicher, director of climate change and energy initiatives with Google.org. “If everyone had a detailed understanding of their own home electricity use, they could find many ways to use less power. And more information also provides utilities with better tools for load balancing and demand-response. We're working on a home energy monitoring tool called Google PowerMeter that provides consumers with near real-time energy information right on their computer – and we're looking to partner with utilities and independent device manufacturers to roll this out in pilot programs."  

These executives, along with executives from GridWise Alliance and Better Place, will be featured speakers at KEMA’s second annual Utility of the Future executive conference, June 17 -19, 2009 in Washington DC. Focusing on “navigating sustainability,” the conference will gather energy and utility industry executives to discuss the changing rules and relationships underlying the transformation of the energy future.

This article will be featured in the next issue of Global Contact, KEMA’s quarterly international magazine.   


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