Building upon last month’s installment, more is revealed on how, after 10 years of incentive regulation, reliability has declined in Ontario.
Consensus building is an imperative and educational art form.
Collaboration among stakeholders with widely divergent points of view never has been more critical. In a world of increasingly complex industry challenges resulting from megatrends now driving the electric industry—including the arrival of infrastructure intelligence, vastly greater customer engagement, and ongoing efforts to resolve the carbon-capacity conflict—the opportunities for misunderstanding, miscommunication, and conflict abound. Players across the electricity sector now must manage an array of constituencies, and if they’re not careful they might face greater intervention in rate cases and significant risks of litigation, as well as negative publicity and poor customer relations.
In three recent cases, utilities used a formal stakeholder collaboration process to open up utility planning and decision-making, and to build support for what could have been a contentious final utility decision. Collaboration, while certainly not a new concept, is taking on greater importance, as the interdependency among stakeholders becomes a fact of life. In one case, Arizona Public Service (APS) needed to make transparent the method it used to assess the benefit of distributed solar on its system. In a second, the Illinois Commerce Commission asked Commonwealth Edison Company (ComEd) to undertake a stakeholder collaboration process to build broad support for the design of its advanced metering infrastructure (AMI) system. In a third, the Maryland Energy Administration (MEA) began a collaborative stakeholder process to develop a smart-grid strategy that would meet the diverse needs of the citizens of Maryland as directed by the Public Service Commission. In each case, regulators played a catalytic role, requiring facilitation to bring the broad community of stakeholders into alignment on a defined challenge.
Facilitation management in this emerging era of stakeholder engagement is an art form, requiring skill and experience, as tempers, prejudices and urban legends often create an environment that easily can spin out of control.
APS: Distributed Solar
Arizona is one of 28 states seeking to increase the amount of renewable energy in its energy-supply portfolio and has committed to aggressive renewable-energy standards. The state is richly endowed with solar resources, and there is a wellspring of enthusiasm and support to move rapidly toward greater reliance on solar. However, large-scale deployment of distributed energy (DE) solar is a relatively new and contentious issue. There are myriad complexities and technical implications involved in integrating a large number of small units into the electrical distribution system. At the urging and direct involvement of the Arizona Corporation Commission (ACC), APS initiated a study in February 2008 aimed at creating a factually-based un-derstanding of the potential benefits of solar DE on the APS system, as well as the impacts on its operations. Facilitation was needed for educational purposes, as well as building a shared understanding and acceptance of the underlying methodology. Intervenors were skeptical of the proposed rates. They couldn’t find the data behind them and weren’t convinced that APS