CEO, Salt River Project
PUF’s Steve Mitnick: Mark, what’s your take on EPRI’s initiative, this Efficient Electrification initiative? And how do you fit in with EPRI?
Mark Bonsall: SRP was a founding member of EPRI at their formation in 1973 and has been a full member of EPRI since its beginning. We’ve had a significant involvement with EPRI’s R&D program over the decades. I currently serve on the board of EPRI and have been on the board for several years.
The Efficient Electrification initiative is a continuation of work that EPRI has been doing for several years as the whole industry works to decarbonize the economy.
Economy wide, if your objective is decarbonizing by X percent by Y year, then you can change X and Y in a number of different ways. One option is by electrifying customer applications that result in a net decrease of carbon emissions.
EPRI’s mission is to focus on factual analysis. It poses the questions about where electrification could occur, identifies possible directions and options and analyzes the impact of those options. Given that factual background, utilities can then work with their customers to identify potential applications and jointly work on the best path forward for that customer
or group of customers. That is what the Efficient Electrification initiative is about.
Hank Courtright: A key question in the debate on carbon reductions is how can we reduce carbon in the overall economy? We can do it through electricity. This is especially true as the electric generation portfolio becomes decarbonized, as we utilize existing nuclear power along with more wind, more solar, and a migration from coal generation to gas generation. As the generation portfolio gets cleaner, it enables carbon reduction in other parts of the economy.
PUF’s Steve Mitnick: This initiative in electrification, can it make a big difference? Are we going to see, say over the next ten years, a big change or a very gradual change?
Mark Bonsall: It may be spread over that time frame. However, things are happening now throughout the economy. One of the most evident places right now is the transportation sector. You’re seeing many of the major auto companies, here in the U.S. and in Europe and Asia, moving towards electric vehicles as a way to decarbonize the auto fleet. That will take time, actually decades, as that phases in.
Today, many utilities are working with major customers to reduce their carbon footprint by looking at industrial and commercial processes. In some cases, those processes could be done through electrification versus a natural gas use or even some type of oil use.
A good example is the number of major airports looking at how to modify or change out the airport “tugs” that move the baggage and push planes, from being diesel driven to being electric driven. That also helps with the local air quality issues where those airports are located.
It will be a gradual transition. I don’t think you’re going to see a huge bulk of it in any particular timeframe, but just a gradual trend towards more electric use and less fossil use.
PUF’s Steve Mitnick: There’s going to be a big conference next summer in Long Beach. What’s EPRI’s role and what is the utilities’ role going to be?
Hank Courtright: There are a couple key roles for EPRI. Probably the most important role is to provide thought leadership coupled with factual analysis. It is important to work with the electricity industry, regulators and legislators across the country to develop a better understanding about the value and impacts of moving from fossil fuel-driven applications to electric applications.
Another key role EPRI will have is providing information to individual utilities so those utilities can better work with their customers on electric applications. EPRI also serves as an information clearinghouse, as utilities share information with each other based on successful customer applications.
It’s a joint effort between EPRI and the electric industry to share data, share expertise, and work with each other to enable Efficient Electrification to be applied this across the country.
Mark Bonsall: This will take some time and a concerted effort. To me, the profound importance of the work is the analysis that goes into it.
For example, it is critical to understand how the use of electricity for transportation purposes has a larger benefit in reducing carbon from gasoline use than the corresponding increase in carbon from the electric generation needed to power those cars and other vehicles.
That’s the premise. One of the challenges that poses is, how do you measure all of this?
Our production of electricity may go up, but the aggregate amount of emissions goes down. How do you measure and account for all of that? Those are the type of questions being addressed by EPRI’s analysis.
EPRI is holding lots of industry and stakeholder meetings in the process of answering those questions. And the Electrification Conference in 2018 will be an important event to discuss the analysis developed and the pathways for future electrification. Is that fair to say, Hank?
Hank Courtright: I think that’s accurate, Mark. EPRI is providing that analysis not only at a national level, but we’ll be helping to do similar analysis at a state level, and an individual utility level, too. As we build the databases around the country, we’ll have a better indication of how to measure and document the emission reductions.
PUF’s Steve Mitnick: What are the main barriers as you see them?
Hank Courtright: The primary barrier is lack of information. As more people get to understand some of the benefits of going to electric vehicles or electrifying certain business processes, it tends to sell itself.
Mark Bonsall: The concept of generating more electricity, nonetheless, seems to run counter to a belief that it would lead to lower overall emissions. That point needs to get across.
That’s one of the barriers. Although, I don’t think that’s huge because it’s so obvious in relation to the electrification of transportation.
PUF’s Steve Mitnick: Are you going to Long Beach for this mega-conference on electrification next August?
Mark Bonsall: SRP is a platinum sponsor of the conference. We think it’s a very important way to get the conversation going, develop a broader consensus and get more people working on the basic ideas. Yes, we absolutely will be there.
We are a sponsor of the work. I think it’s very exciting work. To be quite honest with you, it is terribly important work. I don’t think the focus on emissions management or carbon is going to go away, as many utilities (SRP was the first) have established long-term corporate sustainability objectives. This is a long-term issue, and it requires some long-term thinking and application of sweat equity. I think it’s a good way to get it started.
Hank Courtright: We expect attendance at the conference to include several of our customers who want to learn more about electrification, representatives of the environmental community to help build a broader understanding of the positive benefits of electrification and representatives of the supplier community who provide the products, vehicles and services to the marketplace. It should be an exciting event.