Shifting Utility Landscape

EDITOR'S NOTE: Change is coming to the electric power sector. Some will be policy driven. The most profound changes, however, may be spurred by technology.

The Energy Times recently sat with state regulators from around the country to discuss these issues. They included Lisa Edgar, of Florida and the president of the National Association of Regulatory Utility Commissioners, Philip Jones of Washington, Robert Kenney of Missouri, Robert Powelson of Pennsylvania, Paul Roberti of Rhode Island and Gregg Sayre of New York. Highlights are captured below.

This is the second part of a series of articles sponsored by Burns & McDonnell.

ENERGY TIMES: Robust energy sector change is being driven by policy makers in New York and California. Will that drive new economic development in those states by new service providers? What happens in other states? What will change look like in the electric power sector?

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Powelson: I spend 20 years of my life working in economic development in Pennsylvania. Pennsylvania has transformed its economy from steel, coal and rail. We have 2,100 megawatts of installed wind capacity and 500 megawatts of solar. We have a flywheel battery storage project that is up and running. The Department of Energy took the Philadelphia Naval Shipyard, an abandoned shipyard, and identified it as an energy innovation center. Penn State is leading efforts on energy efficient building design research. The City of Philadelphia passed a building footprint disclosure law to measure energy efficiency. Pennsylvanians do not fear they are not going to reap the benefits of energy technology providers coming in. They are there. They are doing business.Jones: I do not look at economic development and jobs issues as I render decisions on rate cases. But it's always in the background because we have governors, and legislators. Our legislature provided $60 million at the behest of the governor for our Clean Energy Fund. That's the kind of stuff that gets companies to come to your state. It's

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primarily been for energy storage activities and a bit for smart grid. Investors are looking for regulatory certainty, stability and predictability. If you have a governor and a legislature who are really aggressive in recruiting companies to the state in the energy space, it's a good double punch.Kenney: What we are seeing around the country and around the world is that consumers are paying more attention to how energy is consumed and how it's produced. To varying degrees, the customers are asking for more information. Public utility commissions are uniquely placed to take a leadership role in that. We are either constitutionally or statutorily charged with having to take into account the public interest. There is no question that we are not solely charged with just deciding rate cases anymore. For good or for ill, we are charged with having to be involved in the implementation of an environmental policy. We are involved with the implementation of renewable energy standards and energy efficiency standards. There is a significant layer of public policy overlay on everything that we do. So I think we are

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required to be more nimble and creative in our thinking.

Roberti: Energy will follow the path of the telecom revolution. The grid it's going to have amazing reliability. It's going to have sensors. It's going to be modern. It's going to be able to handle two-way power flows. The price of the technology that exists today goes down. One little grain of sand – innovation - will get thrown in and we won't know what's going to happen. Much of the debate we are having may become irrelevant.

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Driving or Responding to Change