EEI exec talks rooftop solar, energy storage, power sector capex

The electric power sector in the United States is getting greener, the sector is innovating and it is undergoing massive change, Maryanne Hatch, manager, regulatory affairs, with the Edison Electric Institute said during her Dec. 1 presentation at TransForum East, held in Washington, D.C., and presented by PennWell’s TransmissionHub.

“[O]ur national fuel mix is changing,” she said. “I would make the argument that our industry is indeed getting greener. ” From 2005 to 2015, we’ve gone from about 50 percent of coal capacity down to about 35 [percent].”

There has been a natural gas revolution, she said, adding, “We went from about 18 percent to about 32 percent right now, and, of course, renewables have been growing as well.”

Noting that over the years, the fleet has become greener and that carbon dioxide emissions have reduced, Hatch said that as the U.S. Environmental Protection Agency‘s “Clean Power Plan moves forward, these trends are going to continue.”

One interesting trend involves solar power in that prices have declined precipitously, she said.

“Interestingly enough, utility-scale solar is still about half the cost of residential solar, and as of right now, in terms of installed capacity, there’s more utility-scale solar than rooftop solar,” she added. “Whether or not that trend continues, we have yet to see. At some point, rooftop may possibly surpass utility-scale, but it depends on customer preferences.”

She addressed the value of the grid, saying, “[W]e do provide a value proposition, the grid does, whether you’re buying power from the grid or selling it back to the grid, you still have to pay for what you use.”

Hatch also noted that energy storage is starting to take off, adding that in 2014, the installed capacity for storage is supposed to be about 100 MW, and projections note that between 2015 and 2019, the amount of storage capacity will be four times what it is in 2015.

“[T]o put this in perspective, 2014 [it] is about 100 MW; we have 1,100 GW of installed capacity in the country,” she said.

She continued: “[T]his is not in any stretch of the imagination picking on storage, it is pointing out the incredible growth opportunity for storage over the next few years, and I do think – this is me speaking personally – it is something for the transmission world to watch out for because we can either work together, or in some cases, you can see some of these storage projects kind of displacing some transmission projects out there.”

Hatch also said that distributed generation is projected to grow quite a bit and that it is driven by reliability needs as well as customer preferences.

She also addressed industry capital expenditures, noting that EEI members represent about $100 billion of investment, with 2015 projections being about $108 billion.

“Between 2013 and 2015, we’ve seen expenditures on generation decrease to some small amount,” she said, adding that part of that may be driven by the uncertain regulatory future that the industry is facing, especially in terms of the Clean Power Plan.

“Until we get those things straightened out, nobody is quite sure what they’re supposed to be building, where,” Hatch said. “There’s been a slight uptick in terms of distribution as well. I think a lot of that has to do with grid hardening, resiliency, storm preparedness, things of that nature, and to some extent, we’ve talked to some of our companies and we have seen them have to start upgrading to start accommodating some of these distributed energy resources as well.”

She also noted that trends reshaping the utility industry are:

·      Slow economic recovery

·      Aging infrastructure

·      Low natural gas prices – “[A]s we become more dependent on natural gas for generation fleet, we’re seeing more of a convergence between the natural gas and the electric power sectors,” Hatch said

·      New competitors, as in third-party providers that “want to provide rooftop solar and ” microgrids,” she said

·      Changing customer preferences and behaviors – “Customers today are more dependent on electricity than they have ever been before,” Hatch said. Customers want greener, more resilient power, as well as more choice and control, she said, adding, “[I]t is up to us as a sector to provide those choices to our customers and empower them”

·      Regulatory compliance – Noting that there are a slew of rules, she said that the big one is the Clean Power Plan, which is “transformative for the industry. Things will continue to get greener”

In that plan, the “EPA basically says, “ËœBecause we’re going to allow emissions trading, that should alleviate any ” reliability issues,'” she said, adding, “[W]e don’t know if [a trading system is] going to be just within states, across states, across regions – we don’t know, and we don’t know if this is going to answer the problem.”

Discussing distribution matters, Hatch noted that customers are interested in going through different electricity providers than just their utility. For example, she said: “73 percent of people would consider going through someone besides their traditional utility to get their electricity. Now, that might be an online provider [or] a retailer ” but the fact of the matter is that consumers are out there and they are considering choice.”

Customers have such choices as microgrids, customer-owned distributed energy resources and advanced meters, she said. Also, customers are not necessarily just looking at costs anymore, she said, adding: “They want local. So, if you think about the local shopping movement ” – how many of you would prefer to shop at your local farmer’s market than at your grocery store? I see it here, we’re seeing it across the country, and so now we’re seeing this thought towards local is better.”

Despite the cost, there will still be a move towards distributed generation resources, she said.

The evolving distribution grid brings up a whole host of policy questions, including how should one plan for the grid, who should design and build the grid, and who should be in charge of it, she said.

She noted that “there is a discussion right now about going to a distribution system operator platform – so, think about ISOs and RTOs, but at the distribution level,” with such questions being addressed as, if that happens, who should operate that DSO, she said.

“We at EEI think that traditional utilities should be able to provide behind the meter services,” she said. “It’s a whole new world out there and we think that we have the experience and the expertise to provide the best solutions for our customers.”

While the issues may seem like they are in the distant future, they are not, Hatch said.

“[T]hese discussions are going on right now, and it’s very real to our customers and to our member companies,” she said.

She highlighted some state initiatives looking into the matter, including New York’s Reforming the Energy Vision and California’s distributed resource plans.

Reliability is the top mission for EEI’s companies and one of the biggest public policy goals, she said.

“Society’s goals have been changing, so it is now our duty and our mission to become a greener fleet and find sustainable resources,” she said, adding that it is important to make sure that costs are affordable for customers.

Previous articleUL certifies Landis+Gyr advanced residential meters
Next articleVIDEO: Duke Energy Indiana seeks approval for $1.83 billion in power grid upgrades

No posts to display