IT

A massive T&D system build-out is starting, but more needs to be done. Executives from Northeast Utilities, Pepco Holdings and ITC Holdings discuss improvements needed for reliability, capacity, security, smart-grid and demand-response measures, as well as accommodating wind and green-energy quotas.

Uncertainties about smart metering goals are hindering efforts to standardize communications protocols and feature sets. While vendors battle over standards, utilities and policy makers are moving forward anyway—despite the potential for setbacks.

The era of easily available, affordable energy rapidly is ending and our society is realizing that our energy infrastructure is severely inadequate to supply the energy demands of the future. The major issue facing the sector today is how to fund and deliver this new climate-friendly infrastructure, which is currently estimated will cost almost $2 trillion between now and 2030.

Originally developed to compensate U.S. electric utilities for regulatory assets rendered uneconomic by deregulation, so-called “stranded-cost” securitization techniques are finding new applications. To date, utilities have issued approximately $40 billion of stranded-cost securitizations. That number could increase dramatically if the industry applies well-tested securitization techniques to the extraordinary costs it faces in the future.

Nuclear-waste management is a multi-billion dollar problem, and the future of nuclear power will depend on its resolution. Four scenarios depict possible outcomes and impacts on the electric power industry.

Bad news from the front lines in the cyber-security war: Little meaningful progress has been made toward safeguarding the nation’s electric grid from malicious attacks. Initial cyber-security assessments and audits suggest few companies really are ready to implement the first wave of NERC critical infrastructure protection (CIP) standards, despite the fact the utility industry drafted the regulations.

Clean-energy R&D needs better funding and leadership to meet aggressive greenhouse-gas emissions reduction targets. But how does the industry get there, and what management model best suits achieving such lofty goals? A new ‘clean-energy institute’ might be the answer.

Federal regulators have penalized wholesale energy market participants with fines ranging from $300 thousand to $300 million over the past two years. The magnitude of the penalties, along with uncertainty over how to effectively mitigate the risk of any civil action by regulators, has raised concern about how companies are approaching their regulatory obligations.

Late last year FERC learned that the Midwest regional grid likely would require at least 40 years — until 2050 — simply to clear its backlog of proposed gen projects awaiting a completed interconnection agreement to certify their compatibility with the interstate power grid. But grid engineers would meet that date only by shortening the process and studying multiple projects simultaneously in clusters. To apply the process literally, studying one project at a time, as envisioned by current rules, the Midwest reportedly would need 300-plus years to clear its project queue.

Nuclear fuel cost projections typically consist of current reported costs that are escalated at the rate of inflation. These projections usually consist of a single estimate in each year. In the past, when nuclear fuel costs were low and declining, this approach was acceptable and may have even been conservative. But this approach is likely to understate projected nuclear fuel cost when nuclear fuel costs are increasing.