Creating the New Utility CEO

Deck: 

Increasing risks call for a new generation of leaders.

Fortnightly Magazine - October 2008
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Years ago, the electric utility industry was a much simpler place to do business. The typical utility delivered reliable electricity to a fixed geographic area at a regulated price. Operational, regulatory and financial risk topped the utility CEO’s agenda, and keeping regulators and shareholders happy—and the lights running—was a good blueprint for success.

The recent escalation of commodity price, environmental and political risks has changed everything. With energy needs rising, and no cohesive national policy to guide utilities in meeting the growing demand, utility CEOs face the unenviable task of strategizing for a market that will be shaped largely by the unpredictable future decisions of politicians.

Can new nuclear power plants get approved? Will wind generators get production tax credits? Will West Coast companies be allowed to re-permit their hydro plants? Will cap-and-trade legislation endanger the coal industry? And who will pay for the transmission of renewable energy? These critical questions still remain unanswered, but utility companies must forge a business strategy through the murk.

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