Energy insiders spark debate over future of electricity
Power players from many of the world’s most innovative companies freely shared their valuable, sometimes controversial, occasionally unpopular insights on the U.S. electricity sector’s most pressing concerns on Monday.
This was at the Rocky Mountain Institute’s inaugural Electricity Innovation Lab Ignite event, part of the flagship GreenBiz VERGE SF event about sustainability and technology.
Throughout the afternoon, in panel discussions and in group settings, participants considered the most titillating transformations and bright spots in the electricity sector today, the emerging opportunities for collaboration both now and five years from now, and what needs to happen “Monday morning” to capture these opportunities.
In effect was the Chatham House Rule, devised in Britain in 1927 to provide the cover of anonymity at meetings so speakers feel more at ease to speak their minds without fear of public quotation and its potential repercussions.
Guided by a team from RMI, the four-hour e Lab Ignite working session was subtitled “Finding Value at the Distribution Edge”.
Members of eLab include state and federal energy regulators; major utilities and grid operators such as Avista, NRG Energy, Pacific Gas & Electric, PJM Interconnection, Puget Sound Energy and San Diego Gas & Electric; tech companies such as Autodesk, Facebook, Hewlett Packard, Microsoft and Yahoo; renewable and distributed energy innovators including Clean Power Finance, Princeton Power, Spirae, SunEdison and Sunverge; large energy consumers such as Walmart and the U.S. Navy; advocates such as Environmental Defense Fund, Natural Resources Defense Council and World Wildlife Fund: and investors such as Vantage Point.
The meeting’s stated objectives were two-fold: first, to understand, to explore and to ignite opportunities for large corporate energy customers to collaborate with utilities and other electric system stakeholders, and secondly, to identify emerging distributed energy solutions for large corporate energy customers.
Many participants addressed the key challenges involved. Here are some of the highlights, anonymously paraphrased and edited for space and clarity:
"Fifteen years ago, we thought technology could solve our problems. We thought all we had to do was invent the right technologies and deliver them to customers, and our problems would go away. The truth is we have learned that technology didn’t solve the problems. But we have also learned that technology has made huge headway. If we hadn’t gotten the price of solar to where we’ve gotten it over those 15 years, we wouldn’t be sitting in this room. Looking at a specific problem, let us think about how we can apply existing technologies to solve the problem."
"When we started we saw the electric system as something that was driven by the utilities and the regulators, and we as customers accepted whatever was sent our way. What has happened over the last 15 years is the grid has become much more consumer centric."
"With all the focus on distributed energy resources, and what they are doing to the system, the analogy that comes to my mind is this: we are used to that nice, even concrete floor, but now it’s like walking over sand and you cannot get good traction. The debate in the industry is how or when will this new surface become more stable. When will it go back to that stable concrete floor? My answer to that is, that’s not happening. The situation has changed. Utilities, energy consumers and energy service providers are all creating optionality for themselves. How they interact with each other – that will come from self-interest. I don’t think everybody is going to sit around and say, ‘Let’s globally solve the problem.’ Everybody is going to optimize from their own perspective."
" As a utility customer, I think it’s kind of amazing the level of service we get from electric utilities – every day. The lights are on, our data centers are humming and they do serve their customers. What their customers want is cheap, clean, reliable energy. It is not a goal for us to have distributed energy; we do in some cases, but that is not our goal. So it’s really important to think about what problem we are trying to solve. And in the process it’s important to not destroy the system that’s actually given us really good service. For all the progress that we’ve made, which has been extraordinary in terms of cost, distributed energy isn’t there yet."
"Utilities do amazing things with the resources they put on the grid today on supply side, as part of their capital plans. But this runs us squarely into one of the institutional problems: if a utility makes money on capital and doesn’t make money on distributed energy resources, because the customer owns them, now we have an institutional puzzle that’s solvable – but it is not solved right now."
" I just saw a pretty interesting statistic: if something is growing exponentially, doubling every year, 1 percent is exactly half way between zero and 100 percent. So in a lot of ways, we are past the halfway point on solar. If we add exponential growth for EVs, and if batteries ultimately catch up, the indicators are that massive change could happen pretty soon."
"I don’t think that the solutions are 100-percent clear. On a technology level a lot is clear, but rate design, market structure, regulatory issues are not. Every state will have it’s own approach."
"We need to enable pilots and demonstrate technologies. One example is probably worth thousands of pages of testimony."
"If you have a success and no one hears about it, is it a success? We need to get this information out."
"We need to start doing distribution planning like we do transmission planning."
"We can’t let the perfect be the enemy of the good. We’ve got to be willing to keep the larger goal in mind. Something is better than nothing."
"We need islandable microgrids, like the military, to defend against cyber attacks."
"Innovative thinking is not normal. The average employee at any company gets paid to do something they have done for a long time. So complacency or routine takes the place of challenging ideas. Innovative thinking, like we are doing here, is how you move people forward."
"I am going to take these conversations, which are not only inspiring but valuable, to help take us where we want to go and to turn into action."