The Impact of Energy Transition: Utility Perspectives Laney Brown - - PowerPoint PPT Presentation

The Impact of Energy Transition: Utility Perspectives

Laney Brown Vice President Modern Grid Partners

Climate Change New Technologies (Smart Grid, DG, Storage) Changing Customer Needs Aging Infrastructure (Generation, Grid)

Changing Energy Landscape

• Regulatory

uncertainty

• Impact on

Reliability

• Retiring plants
• Pent up

investment demand

• System

inefficiencies

• Disruptive

(good & bad)

• Technology -

foundational to transition

• Price + reliability
• More options
• Comparable to
• thers

• No single view
• Continuum of utility positions:
• Key drivers: Regulatory policy, cost
• f electricity, and customer

expectations

• Impact and speed
• Shift from defensive to offensive
• Utilities recognize the need to change

and are planning and implementing ‘utility of the future’ strategy:

• Customers
• Regulation
• Grid investments
• Workforce

Energy Transition: Utility Perspectives

60%

• f utility execs expect their

market to be ‘50% transformed’ by 2030

66%

• f utility execs say

business model change is urgent

11% 11% 8% 5% 3% 55% 51% 48% 41% 37%

Changing Operations & Investment Focus 2016 to 2030

Grid EVs Utility DG Customer DG Microgrid

Source: 2015 PwC Utility 14th Annual Executive Survey

Utilities’ Challenges and Opportunities

Challen enges ges Oppor

• rtu

tunit itie ies

Grid Investments

• Reliability
• Cyber security
• Aging infrastructure
• Costs
• Advanced technologies

(Smart Grid, DG)

• Alternatives (NWAs) to

traditional investments Regulation

• Policy uncertainty
• Risk of financial stability
• New business models and

incentives Customers

• Customer satisfaction
• Changing customer needs
• New ways to serve and engage

customers

• New product & service offerings
• Community engagement

Workforce

• Aging workforce
• Agility and focus

(Operations vs. innovation)

• Opportunity for new skill sets

Traditional Rate Making

Earning Adjustment Mechanisms (EAMs) Platform Revenue Services (PRS) New Rate Design

New York’s REV Policy & Utility Revenue: A Case Study

Opportunities:

• Balances new regulatory incentives

with traditional rate making

• Opportunity to test new business

models

• Outcome-based approach

Challenges:

• Meeting system and policy needs

without increasing costs

• Outcomes and values are unknown
• Simultaneous execution of

traditional and new initiatives

Adapt and Evolve: Utility Action Plans

Growth/ Investments Regulation Customers Workforce

• Invest in new technologies

(grid/new generation)

• Expand in gas sector
• Coal to gas/renewables
• Pursue re-regulation of

non-competitive generation assets

• Broader service offering
• Expand behind the meter
• Proactive succession planning (people/skills)
• Balance operations/ innovation
• Maintain focus on safety and reliability
• Balance core capex + new

business opportunities

• Growth through new

models/new services (EV)

• Pursue balanced

regulatory approach

• Broader, customized

service offerings (EE+)

• Increase customer

engagement

Electric Utilities

(Vertically integrated)

Electric Delivery

(T&D)

Source: ScottMadden Energy Industry Update

• Take a long term view but plan and execute today
• Identify opportunities within the transformation
• Maintain a balanced perspective:
• Safe, reliable and affordable are still the fundamental elements of service
• Focus on core business with increased (smart) grid investments, and

expanding customer-centric offerings

• Execute on operational excellence and innovation in parallel

Summary

Modern Grid Partners is a consulting firm that provides business and technology expertise to our customer’s operations, projects, and future goals. We focus on increased operational performance and enhanced reliability by employing smart grid solutions. Our team members have supported customers around North America in bringing their visions to reality. Founded in 2015, Modern Grid Partners is headquartered in Portland, ME. info@moderngridpartners.com | 207.712.3577 | Moderngridpartners.com