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Driving Electric Change

Illinois and a handful of states are exploring new electric grid policies and innovations.

The Illinois Commerce Commission has launched a study called NextGrid to explore how to build the utility of the future and reshape Illinois’ energy landscape by 2030.

Nextgrid will be a consumer-focused effort to study ways to leverage the state’s restructured energy market, investment in smart-grid technology, and significant expansion of renewables and energy efficiency as a result of the state's Future Energy Jobs Act.

It is based on the growing sense of both opportunity and urgency among Illinois energy stakeholders to map out the future of our energy system; so our policies are proactive and take advantage of new technologies instead of reactive policies that slow progress and innovation.

What differentiates NextGrid from similar efforts is that our process will be facilitated by academics and builds upon one of the most advanced smart grids being deployed.  Our lead facilitator team is from the esteemed Electrical and Computer Engineering Department from the University of Illinois Urbana-Champaign.

The department will leverage their educational experience to elicit a robust exchange of ideas among all stakeholders, utilize their network of leading academics to inform policy conversations, and ground deliberations in a real technical understanding of grid impacts and capabilities. 

It is really important that this process includes and empowers the customer, and so we’ll present working groups findings at public meetings through the state.   The final deliverable for NextGrid will be a report that will provide a range of actionable recommendations aimed at empowering customers and communities, driving economic development, optimizing the electric utility industry, and creating a 21st Century regulatory model that supports innovation. 

Illinois is not alone in this effort. Similar efforts have or are currently taking place in states including New York, California, Massachusetts, Maryland, Ohio, and Hawaii. 

It is clear that there is a real sense of change in the American energy industry and has driven these states to map out a future vision for the industry and recommend pathways to that future. 

Our technology may be vastly different, and yet many of the same issues and challenges faced by Samuel Insull a century ago are still with us today:  advanced metering, network effects and economics, efficiency and system management, rate design and regulation. 

The difference is that in today’s technological and information-driven world, advances in both distributed generation and end-use technologies, like electric vehicles, are giving customers unprecedented levels of customization and control of their energy usage and services and, subsequently, shaping new expectations.  These technologies have considerable implications for the physical grid which utilities, regulators, and others are seeking to address.

Advanced metering infrastructure, the introduction of so many new digital devices, and the Internet of Things have unlocked massive new data sets which innovative developers are utilizing to devise new applications for energy customers.  According to the U.S. Energy Information Administration there are currently more than 60 million installed smart meters in the U.S. representing about a fifth of all electricity customers that will eventually be online.  This figure will be dwarfed by the number of smart pieces of equipment on the network.  And automated and electric self-driving cars and trucks are in the not-so-distant future. 

According to Bloomberg New Energy Finance electric cars will outsell fossil-fuel powered vehicles within two decades as battery prices plunge, displacing about 8 million barrels a day of oil production.

This shift will raise fundamental questions for the future of the energy system.  One of the biggest revolves around the role of the utility in this future. Utilities have begun to adapt their business models and, as you know, there are lessons of both opportunity and peril for American utilities to learn from their European counterparts.

Other key questions that must be tackled include: How do we maintain reliability and resiliency in a more distributed grid? What does fair compensation to distributed energy resources look like? What is the appropriate use of customer data? How do we ensure that we don’t unfairly burden certain market participants and vulnerable groups? And finally, a question that I spend a lot of time thinking about --how does the role of the regulator need to evolve in this new reality? 

EDITOR'S NOTE: This article is excerpted from remarks given by Chairman Sheahan to European Utility Week in Amsterdam in October.

 

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