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CEO Roundtable: Debating The Boucher Bill

Utilities consider imposing a retail surcharge to fund clean-tech R&D.

Fortnightly Magazine - December 2008

countries. So we just simply can’t sit back and say, ‘Gosh, things are really odd right now, let’s not do this, let’s wait.’

As Sen. John McCain told Sen. Jim Inhofe, if the scientists are wrong, we’ll be investing a tremendous amount of capital to advance science and make the world a better place. If that’s the downside, let’s do it. But let’s say the scientists are right, and this could be a calamity beyond calamities, and the productive parts of the world could shift like tectonic plates. Where would we be then? So let’s err on the side of doing the right rather than being a naysayer and doing the wrong.

Notwithstanding the financial pressure we’re all feeling right now, we need to reduce our dependence on imported oil. I’m a fan of Boone Pickens’ idea of getting natural gas into cars. Put plug-in electric cars on top of that with off-peak power production, and you’ve taken 30 percent, 40 percent or maybe even 50 percent of the liquid fuels out of transportation. If you do that, you’ll have a permanent impact on the price of gasoline for our country.

We need to move forward. The U.S. economy has, will, and can, absorb these kinds of blows.

Catell: We can’t take our eye off the ball. There’s more enthusiasm now than I’ve ever seen for investments in new technologies. The pressure of high prices, the recognition that we need to reduce our dependence on imported oil and the environmental considerations are more in the public’s eye than they ever have been. We’re in a rough period, but we’ve got to maintain a long-term focus, and not waste another 30 years without addressing the problems.

Chesser: The international benefits of carbon-sequestration technology might be at the top of the list. If you’re going to have any real impact on carbon, it’s not in the United States but in the developing countries. Developing CCS technology for export could be a huge benefit.

But one thing keeps haunting me. If you go back to the ’70s, the experts were projecting load growth out through 2010 or 2020, and that rate of growth was between 6 and 8 percent. That never came to fruition. It was more like 2 percent. Today we’re looking at 2030 and saying energy demand will increase by 30 percent by 2030, assuming a 2 percent cumulative effect. There’s a scenario I can see with prices continuing to rise, and particularly if we get more penetration with energy efficiency, in which we basically have flat load growth or maybe even a little less than flat. There are all kinds of potential scenarios.

The thing about distributed technologies like solar and energy efficiency is you can dial them up or back. They don’t need huge lumps of investment that would be potentially stranded, so they have a strategic benefit in the utility industry, combined with the smart grid, that I’m not sure we’ve fully come to grips with.

Izzo: I’d combine that point with one that Mike Morris made, that [renewables and