Strategy & Planning

Is development of retail choice compatible with best-priced standard-offer service for smaller customers? Conflicting policy priorities threaten to distort Maryland’s retail energy markets.

How can utility companies ensure investment dollars are being allocated wisely? Asset portfolio management (APM) attempts to capture and analyze the relationships among the drivers of SHV at the portfolio level. It provides management with a well-informed, multi-dimensional picture to help make efficient asset investment decisions that optimize the total enterprise SHV.

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.

Utilities are headed for trouble. A critical shortage of skilled employees likely will worsen. And overcoming the workforce gap will require viewing it as a strategic issue, and taking a comprehensive, fact-based approach.

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.

One of Hollywood’s biggest blockbusters this summer has been Wall-E—Disney-Pixar’s animated movie about a lovable robot who restores humanity’s place on a trashed Earth. I doubt Wall-E’s producers realized it, but they created a cynical metaphor for the U.S. utility industry.

The U.S. nuclear power industry faces a yawning talent gap. Half of the industry’s employees are over 47 years old, and more than a quarter of nuclear workers already are eligible to stop working. Meanwhile, as the baby boomers retire, there will be far fewer available replacements with nuclear knowledge.

Electric utilities throughout the country are rolling out an assortment of mobile workforce solutions, many of which already are found in other industries. Three mobile workforce solutions recently were implemented at National Grid in Long Island, New York, FirstEnergy in Akron, Ohio, and Idaho Power in Boise, Idaho. Each demonstrates the state of the art in a different slice of the operations pie: power generation, distribution system operations, and customer service.

Utilities are at the threshold of some of the most significant changes they have faced in their history, rivaling the passage of PUHCA in 1935. This change emanates primarily from a handful of key business drivers associated with major technological improvements (i.e., AMI, smart grid), the need for increased customer focus, increased regulatory mandates, and a changing workforce.

A huge backlog exists for utility infrastructure projects. Major players in the construction industry—ABB, Black & Veatch, Siemens, The Shaw Group and WorleyParsons—discuss the trends, both good and bad, and how they are getting the job done on badly needed projects.