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CEO FORUM: Dealing with Disruption

Leaders adapt to strategic shifts in the utility landscape.

Fortnightly Magazine - June 2010

world unfolds.

 

Zero to 60

Fortnightly: What do you view as the proper role for utility companies in the EV market: evangelists and cultivators; facilitators and enablers; or just load-serving entities?

Boston, PJM:  We are evangelists here, but the industry has to focus on the customer. We want to work closely with states that set retail rates and with utilities that interface with distribution systems and customers. If it’s not done right, it won’t work. If you don’t have controls and pricing in place, then everybody will come home and plug in, and you’ll have voltage problems.

Our role is to be the innovator that brings opportunities for EVs in the wholesale market, and to provide benefits in terms of the transmission grid through locational marginal pricing, and in terms of the load factor for all our assets. The annual load factor is down in the 50-percent range in the United States, so there’s a lot of opportunity to use existing assets more efficiently and get a higher kilowatt-hour throughput.

Burke, TXU Energy:  We’d put ourselves into the category of facilitators and enablers, because ultimately we want to provide solutions that customers want. In the EV space we’ll structure our products and services to work for our customers, so they can recommend it to others.

Weston, Direct Energy:  We have to be an enabler. I don’t think you’ll be able to look at EVs in isolation from the rest of customers’ energy requirements or how you serve them. It will become increasingly important for companies like ours to work with manufacturers and infrastructure suppliers to work out how we integrate EVs. We can’t afford to stand by and watch, so we’ll be increasing our investment in the coming years.
 

Just-in-Time for Transportation

EDITOR’S NOTE: For this month’s cover story, “ Tipping Point ,” Fortnightly contributor Steven Andersen interviewed Southern California Edison CEO Ted Craver. As Andersen’s interview illustrates, SCE’s experience with electric vehicles (EV) and smart metering technology gives Craver a unique perspective on the opportunities and challenges EVs represent for utilities.

Fortnightly: How far away is a future with full vehicle-to-grid integration and smart charging to capture off-peak wind generation?

Craver, SCE:  One of the reasons that we’re interested in seeing more EVs is that our infrastructure is built on what might be considered a just-in-time delivery concept. There really are no commercially viable means of storing electricity, other than hydro-based storage, and those are pretty limited. Electric vehicles, because of their storage capabilities, could be charged during off-peak periods and then used during on-peak periods.

It’s further intriguing that here in California we’re blessed with a lot of renewable energy, much of it being off-peak wind energy. We have the potential, if we provide the right kinds of incentives, to charge vehicles using off-peak power, much of it from renewable sources, without putting additional load onto the system. That is very much for real, and we’re excited about it.

Where the scenario becomes less likely is the notion of V2G, where the car can dump power into the grid when

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