Cheap gas, regulatory uncertainties, and a technology revolution are re-making the U.S. utility industry. Top executives at three very different companies—CMS, NRG, and the Midwest ISO—share their...
Policies Get Smart
State and federal incentives push utilities to invest in grid intelligence.
such actions would be cost-effective and mutually beneficial.
America’s demand growth and strategic interests call for the nation to implement the smart grid at a faster pace than is happening today. Policy changes, environmental concerns, growing demand and changing markets have presented the U.S. utility industry with a substantial challenge—but also a unique opportunity to significantly transform the electric system. Deployment depends on the alignment of technology, regulatory signals and customers.
Regulatory policies must provide utilities with the proper incentives to encourage investment in the best technologies. Toward that end, NARUC and other regulatory bodies are coordinating dialogue about regulatory changes. Policy innovations in support of smart grid concepts can be central to protecting consumers, utilities, the economy and the environment when they are developed in partnership with regulators, utilities and consumers.
Recent research and demonstrations show that customers will be partners in this transformation if engaged early and offered the right incentives. Industry leaders already are exploring innovative concepts and stepping out to test the waters.
The convergence of information and communications technologies with digital device capabilities stand to fuel a substantial transformation of North America’s electric system. It promises to release a wave of innovation and opportunities to see the power system as never before; tap the substantial resource of the demand side of the electricity system; improve efficiency and reduce greenhouse gas emissions; reduce dependence on energy imports; and simultaneously enhance asset utilization and overall reliability. The challenge lies in matching technology potential with regulatory reforms to allow the right incentive signal through to utilities and consumers.