Power infrastructure: Louisiana PSC


State Commissioners

Fortnightly Magazine - June 18 2024

Ten Commissioners discuss their concerns about electric power infrastructure.


PUF's Paul Kjellander: What are the most important needs for electric power infrastructure?

Commissioner Eric Skrmetta: Resilience is not only one of poles and wires, but it's one of continuity of baseload power resources. We need to focus on that to make sure we provide on all aspects.

We look at resilience and want to make sure we can withstand and bounce back on issues related to the infrastructure, but we need to have that same effect on providing power and keeping the power resources in play. Because if you put the poles and wires back up, you still have to put the electricity back on. We have to make sure we look at all elements of that equation.

PUF: Is there anything unique in that, that you see in Louisiana specifically?

Commissioner Eric Skrmetta: Louisiana is well positioned on natural gas for the resources, but we need to be looking forward. We've had testimony at our recent meetings telling us that we're going to need a lot more power. We're going to need as much as six thousand megawatts of power in the future.

I anticipate we're going to need at least three thousand in natural gas and as much as three thousand in new nuclear. The president of Entergy testified to that.

We have to play the long game and look to the future. We anticipate at least another one-thousand-megawatt facility coming online with natural gas quickly to produce electricity.

That is needed as we move forward with increases in demand coming from the chemical industry, which is somewhere in the one hundred fifty billion dollar range of investment that's going to be coming in along the Mississippi River.

EEI Annual Meeting 2024 - June 18-20

PUF: As you look at the infrastructure in your state, what do you see as the greatest concerns?

Commissioner Eric Skrmetta: I hope we don't fail to maintain infrastructure; whether it's distribution, transmission, generation, and adequate reinvestment to keep up these resources. We have to balance the interests as those are important, but we also don't want to over-engage and overspend needlessly.

We must find the right amount. We want to make sure we're not pulling up resources that we have recently put in the ground. We don't want to have to pay for stranded assets.

We want to make sure we're doing right by the ratepayers. We certainly want the companies to be kept in healthy condition because there's no value to a utility that's teetering financially. It's finding that strike point to make sure we get it done properly.

PUF: How should utility regulation adjust to the needs and concerns, if it needs to adjust at all?

Commissioner Eric Skrmetta: In general, reasonable regulation maintains quality of the system, but federal regulation at the NRC could help us as we move forward in trying to add that component of nuclear power to our system. We already have two nuclear devices in Louisiana. We have another one that is part of our system in Mississippi.

But we have to find a way to adjust the regulatory process at the NRC to make it work more reasonably to where we can clear a path to move new nuclear technology into the systems. That is so nuclear can benefit stability and baseload power additions and do so as these systems put us in a net-zero position, with a combination of natural gas, as we move into the future.

PUF: Look to 2040. How different do you think the electric power infrastructure will be in another twenty years?

Commissioner Eric Skrmetta: From what we're hearing now, particularly on artificial intelligence and data centers and the unknown beyond that, it's going to be a vastly larger amount than we have now. The projections are showing that utilities are going to have significant increases.

We need a five-year lead time at a minimum, even if we just look at natural gas resources to be added and probably need seven or eight years for nuclear. But we have to play that lead game to get us to that point of reacting to the future. I hate to say this, but we have to work the crystal ball and with all relevant factors to get us to 2040.

We're going to have to recognize that no one is saying there's going to be a reduced demand for electricity. It's a super-addictive commodity.

We know that with the technologies that are going to be craving it, that we're going to have to build more resources and get them done in a way that can get us to that net-zero goal established by the federal government. To do that, we're going to have to find our way to balance that power resource between natural gas and nuclear for the future.

PUF: As you think about infrastructure needs, how does it compete with concerns about affordability?

Commissioner Eric Skrmetta: This is where reasonable regulatory can help, as concerns for the public cost have to be closely balanced with keeping the lights on. We have to make sure that deliverability of electricity is there, but at the same time, we have to balance out these interests on cost.

It goes back to the old expression of, the first thing you have to do is make sure when people hit the switch that the power comes on. At the same time, when they get their bill at the end of the month, it's the lowest bill we can effectively create for them.

EEI Annual Meeting 2024 - June 18-20

There're a lot of people in between those two points who are trying to affect the price of electricity, and not always in a good way. We must find a way to balance these interests. That is a critical description of what Public Service Commissioners should do, which is balance interests.

But we should find a way to always work toward improving the quality-of-service cost in life for the ratepayers and establish a balance that allows for companies to maintain a healthy existence so they can continue to deliver quality products at the right price to the consumer.


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