Canadian markets beckon U.S. utilities, and vice versa, demanding greater access to transmission lines to bridge the gap.
When I took the job of president of Niagara Mohawk Power Corp., way up North, near the Canadian border, I shared the news with a close friend. I told him how excited I was to be joining an innovative team that was out in front, breaking new ground in the competitive arenas rapidly evolving in the electric power industry.
He looked me in the eye and asked, "Do you know what people who are comfortable in the dark do when they see light at the end of the tunnel?"
"No," I replied.
"Build more tunnel," he said.
We can see the light at the end of the tunnel, of course, from both the U.S. and from Canada. That tunnel, a metaphor for the transmission bottlenecks that block access to energy markets, is a natural result of regulation in the electric industry. However, powerful market forces are rapidly changing that regulatory framework. Soon history may forget why it ever existed.
Some suggest that these market changes stem from public policy and regulatory initiatives. Indeed, it is true that sweeping regulatory changes are upon us. Arguably, these changes appear to affect the production, pricing and transmission of electricity.
Nevertheless, in my view, these changes occur simply as manifestations of the force of new technologies. In fact, as we restructure the electric industry, we must take care to craft policies that respond to emerging technology (em and not to tunnel-building instincts.