Utility Dive lists Top 10 transformative trends: What do you think?

Transformation could be the most overused word in the electric utility industry these days. Big data, energy storage, the internet of things and electric vehicles are just a few of the technologies we are being told will change the way we do business forever.

But what utility professionals see on the ground may be quite different, both from what we hear and from what other utilities are dealing with. The trends that are actually affecting your utility depend on what part of the country you serve, what your customer base looks like and whether you are an investor-owned or public power utility.

To get a sense of where the utility industry is headed, the online magazine Utility Dive You are leaving WAPA.gov. recently identified 10 trends that seem destined to shape our near future:

10. Coal power in decline – Since 2009, 25 gigawatts (GW) of coal capacity has retired in the U.S., and another 25 GW of retirements are planned by 2022. However, the Environmental Protection Agency still expects coal to be a major fuel source for electricity generation through 2030.

9. Natural gas is growing fast – As market conditions and regulations push older coal generators into retirement, utilities are increasingly looking to gas plants to add reliable capacity quickly. Analysts still expect it to grow steadily over the coming decade and then switch to retirement between 2020 and 2030, a trend that could come sooner if natural gas prices rise from their historic lows.

8. Renewables reaching grid parity – Once dismissed as too expensive to be competitive, wind and solar—especially utility-scale—are reaching grid parity and often pricing out more traditional generation resources. In fact, the Department of Energy estimates that wind could be the nation’s single greatest source of energy by 2050, comprising up to 35 percent of the fuel mix.

7. Utilities face growing load defection – With the rapid proliferation of rooftop solar, some customers are bypassing their local utility for their electricity needs, especially in a few markets such as Hawaii and California. Customers combining load management strategies with rooftop solar installations could purchase less power from their utility, and may even cut the cord altogether.

6. Utilities getting in on the solar game – A number of utilities are responding to load defection and consumer demand for clean energy by expanding into the solar industry, both in the utility-scale and rooftop markets. Community shared solar, which allows customers without suitable rooftops for solar to buy a few modules on a larger array, grew exponentially between 2014 and 2016.

5. Debates over rate design reforms and value of distributed energy resources (DERs) are heating up – Altering rate designs to properly value distributed resources is a trend that has largely grown out of retail net metering. This pays utility customers with solar the retail rate for the electricity they send back to the grid.

4. Utilities are modernizing the grid – Adding new utility-scale and distributed renewable capacity has increased the need for utilities to upgrade and modernize their transmission and distribution grids. Many of the regulatory initiatives underway to help determine the value of DERs also order their state’s utilities to prepare their distribution grids for increased penetrations of distributed resources.

3. Utilities buying into storage – Few technologies hold as much promise as energy storage for utilities looking to optimize their distribution grids and integrate more renewables. While the price for battery storage is still too high to make projects economical in regions with relatively inexpensive electricity, costs are coming down quickly.

2. Utilities becoming more customer-centric – Power companies used to think of their consumers simply as ratepayers, or even just “load,” but new home energy technologies and shifting customer expectations are pushing them to focus on individual consumers. Increasingly, utilities are seeing it in their best interests to market themselves to customers as “trusted energy advisors” of sorts.

1. Utility business models are changing – The common thread running through these trends is that they all are changing the way electric utilities have traditionally done business. Where utilities were once regulated monopolies, the growth of distributed resources is forcing them to rethink their business models. California and New York have captured most of the headlines for redefining the utilities’ role on the distribution grid, but other states have initiated their own dockets to transform business models.

It is likely that your utility has had to think about at least a few of these issues and may be grappling with more of them before long. Energy Services is here to help our customers manage these challenges and more. Contact your Energy Services representative to discuss how to turn transformation into your greatest opportunity.

Source: Utility Dive

Utility industry survey identifies top concerns in 2017

The results are in from Utility Dive’s State of the Electric Utility Survey 2017
and the report is available to download. You are leaving WAPA.gov.

The top five issues utilities identified as their biggest challenges will no doubt sound familiar to WAPA customers, whether or not they participated in the survey:

  • Physical and cyber security
  • Distributed energy policy
  • Rate design reform
  • Aging grid infrastructure
  • Reliable integration of renewables and distributed energy resources (DERs)
72 percent of utility professionals said physical and cyber security is either "important" or "very important," making it the most pressing issue for the sector in 2017.

72 percent of utility professionals said physical and cyber security is either “important” or “very important,” making it the most pressing issue for the sector in 2017.

The results of the survey, disclosed in late March, found that 72 percent of respondents see physical and cyber security as either “important” or “very important” today, making it the industry’s most pressing issue in 2017. A total of 65 percent considered distributed resource policy either important or very important. Rate design reform ranked as important for 31 percent and very important for 32 percent of respondents. As for aging grid infrastructure, 34 percent of survey respondents see it as important today, while another 28 percent say it is very important. The reliable integration of renewables and DERs finished in the top five with 60 percent identifying it as an important or very important concern.

State regulatory model reform, the aging utility workforce, changing consumer preferences, compliance with state power mandates and stagnant load growth rounded out the top ten issue responses.

Two years ago, physical and cyber security ranked as sixth, behind aging infrastructure, aging workforce, current regulatory models, stagnant load growth and federal emissions standards.

More than 600 electric utility employees from the U.S. and Canada took online questionnaire, offered to Utility Dive readers in January. Investor-owned utilities represented 54 percent of the survey respondents, followed by municipal or public power utilities (32 percent) and electric cooperatives (14 percent).

Among other key takeaways in the 2017 report, the survey found that utilities are most confident in the growth of utility-scale solar, distributed energy resources, wind energy and natural gas generation over the next 10 years. They also expect coal generation to decline significantly, while nuclear generation will stagnate or retire, depending on the region. Utilities consider uncertainty over future energy policies and market conditions to be the most significant challenge associated with the changing power mix, according to the survey.

Region played a role in how utilities viewed challenges. The majority of respondents across the country identified physical and cyber security, DER policy and renewable energy and DER integration as serious issues. However, that concern was markedly stronger in the West Coast, Great Plains, Rocky Mountain and New England regions. Utility Dive noted that those regions feature states with both robust DER growth and utility reform dockets to reshape power sector business models for DER deployment.

Rate design reform and aging infrastructure were of greater concern on the West Coast, while utilities in the Southwest and South Central states were the least worried about those issues.

You can download the report for free and see how your responses stack up to those of your colleagues. Then, share your thoughts on these issues with Energy Services, let us know how you are handling them and how you would like us to help you address them.

Source: Public Power Daily, You are leaving WAPA.gov. 4/10/17

Weigh in on state of our industry

Utility Dive You are leaving WAPA.gov. is looking for input from electric utility professionals for its annual State of the Electric Utility Industry Survey. You are leaving WAPA.gov.

With major policy upheaval at the state and federal level, the results this year could be more important than ever. The online industry news magazine needs the opinion of its readers on where the industry is headed in 2017 and beyond. Offer your perspective in UD’s fourth annual survey and encourage your coworkers to do the same.

The best way to see the results of the survey is to take it. It takes 10 to 15 minutes to complete and could provide you with powerful insights into the electricity industry’s future. Also, you can download the results of last year’s survey for a look at how trends played out in 2016.

Source: Utility Dive, 2/1/17

Energy department issues largest energy-efficiency standard ever

That boom you may have heard at the end of 2015 was the Department of Energy Appliance and Equipment Standards Program sending the year out with historic new efficiency standards for commercial air conditioners and furnaces. The new standards are expected to save 1.7 trillion kilowatt-hours over 30 years of sales, or almost as much energy as one year’s worth of coal generation in the United States.

Tons of savings
Rooftop air conditioners cool about half the commercial floor space in the nation. The DOE also set standards for commercial warm air furnaces, which are typically installed with the rooftop commercial air conditioners. Over the lifetime of the products, the standards will save businesses $167 billion on their utility bills and reduce carbon pollution by 885 million metric tons.

According to DOE estimates, the new rooftop air conditioner standards will save more energy and cut more emissions than any other standards completed by the agency. The previous record-setters were the 2014 standards that covered electric motors and the 2009 fluorescent tube lamp standards.

ASAPgraph

(Graph by Appliance Standards Awareness Project)

Takes teamwork
Representatives of individual manufacturers, installers, utilities, environmental groups and efficiency organizations actively contributed to the development of the standards. The American Council for an Energy-Efficient Economy You are leaving Western's site., the Appliance Standards Awareness Project You are leaving Western's site. (ASAP) and the National Resource Defense Council You are leaving Western's site. were among the 17 stakeholder groups participating in the Appliance Standards and Rulemaking Federal Advisory Committee (ASRAC).

ASRAC uses negotiated rule-making to engage all interested parties, gather data and attempt to reach consensus on establishing energy-efficiency standards. The proof of the process is in the savings—about 5 billion metric tons of emissions in 2014—and in the support for its work. In an interview with UtilityDive You are leaving Western's site., Marianne DiMascio of ASAP observed that the work of the committee often goes unnoticed because it is largely uncontroversial—a rare thing for a government agency in today’s political climate. “It doesn’t always make for exciting news to say there’s a policy that many people agree with, that is having a huge impact, and it’s about the type of motor your air conditioner uses [or the amount of insulation on a water heater],” she said.

Phasing in
These new commercial air conditioning and furnace standards will occur in two phases. The first phase will begin in 2018 and will deliver a 13-percent efficiency improvement in products. Five years later, an additional 15-percent increase in efficiency is required for new commercial units.

Visit the DOE website to learn more about the energy-efficiency standards for commercial air conditioners  and warm air furnaces.