EDITOR’S NOTE: David K. Owens, Edison Electric Institute executive vice president, explored the grid revolution now underway in his keynote address to the recent Empowering Customers & Cities conference in Chicago. His insights are presented below. EEI along with Commonwealth Edison were among the sponsors of the event, organized by The Energy Times.
The electric utility industry is in the midst of a significant transformation that is being driven by new technologies, shifts in public policy, and evolving customer and market expectations. This is an exciting time, as the ongoing transformation offers many benefits for electricity customers and presents many opportunities for EEI’s investor-owned electric company members.
Today, the electric generation fleet is transitioning to one that is even cleaner and more efficient. At the same time, the power grid is evolving from a one-way system, with a clear dividing line between producers and customers, to a dynamic, multi-directional network that delivers electricity and information to customers and back to the utility.
Increasing numbers of customers are assuming a more active role in managing their electricity supply. These “prosumers” are adjusting their demand for electricity in response to price signals and, in some cases, becoming suppliers themselves. Electric utility investments are hastening the integration of new technologies into the system—enabling the connection of distributed energy resources, like small-scale wind and solar, energy storage, microgrids, and devices in our homes and businesses that create a smarter, stronger, and more decentralized grid.
Customers are excited about all of the changes unfolding and, our research shows, are counting on our industry to deliver the future they see coming. The industry is pushing the boundaries of innovation and is focused squarely on three core driving principles: a modern, reliable, and resilient grid; innovative customer solutions; and even cleaner energy.
It really comes down to a simple formula: Provide safe, reliable, and clean electricity to customers at a cost that is as low as possible. Every public policy initiative, regulatory action, and business decision made by electricity providers, regulators, and policymakers should be guided by this formula.
It is exciting to hear how industry leaders envision how the future will unfold. ComEd President and CEO Anne Pramaggiore, for example, speaks of a network paradigm, in which value is created through the effective integration and coordination of multiple players on the grid. This model is inclusive and expansive, which enables the utility to leverage its assets and abilities to serve a diversity of participants on the grid.
The utility will fill a number of roles within the future grid, including functioning as the Distribution System Integrator that creates, maintains, and operates the platform required to integrate distributed energy resources and to support multi-directional power flows. In addition, the utility should function as the Distribution System Operator that manages the various transactions between suppliers and customers being carried out on the grid. The utility also can provide a wide range of services on both sides of customers’ meters.
The grid transformation will occur in phases, beginning with grid enhancements and the adoption of advanced communication and information technologies; then proceeding to the development of an optimal platform for integrating and supporting distributed energy resources; and finally establishing a full network supporting distributed energy options. The pace of change will vary by region, as this transformation is evolutionary, not revolutionary.
In every case, the goal remains the same—to give all electricity customers more flexibility and control over their energy use and to continue to provide them with the safe, reliable, affordable, and clean electricity they depend on to power their everyday lives.
David K. Owens is the executive vice president of the Edison Electric Institute’s Business Operations Group and Regulatory Affairs.