Money to Burn

Smart-grid stimulus targets the wrong problem.

The $800 billion stimulus bill has spawned a feeding frenzy among would-be recipients of the money. Smart-grid technology companies, for example, are excited about the bill’s $4.5 billion in 50/50 matching grants to “modernize the electric grid.” However, not everybody is cheering.

Building the Next Generation Utility

Fundamental changes require bold strategies.

While many utilities have embarked upon efforts to define a path toward the next generation utility, these efforts often are siloed initiatives driven by the generation, transmission and distribution (T&D) or customer segments of the organization. Addressing the upcoming challenge will require a coordinated and integrated set of decisions so as not to sub-optimize the end-to-end value chain. Eight critical themes across the generation, T&D and customer elements of the value chain will shape the future of our industry.

Dynamic Pricing Solutions

How to account for lack of strong price signals. A hard year puts deregulation to the test.

The greatest benefits of time-of-use pricing come from avoided costs of peaking power and T&D capacity—but only if hourly retail prices accurately model the true costs of delivered energy, including scarcity rents. Restoring the missing price signals will encourage economic investments in AMI, conservation and system capacity.

2008 Regulators Forum: Putting Efficiency First

New rate structures prioritize conservation, but will customers buy it?

As saving energy becomes a policy priority, utility commissioners struggle to reconcile traditional revenue models with smart metering and smart pricing. Unlocking conservation potential will depend on transforming passive ratepayers into smart consumers. Fortnightly hosts a roundtable discussion with commissioners from six states.

Defensive Invention

When the U.S. Patent Office published patent application number 11/626,810 in July 2008, few people noticed—at first. Soon, however, the metering-technology community was abuzz, mostly with outrage. If the Patent Office grants the patent and all its claims, other utilities would be legally forbidden from using any of the methods described, without first obtaining a license from the patent holders.

AMI Standards: A Work in Progress

Vendors battle it out while utilities await common communications protocols.

Uncertainties about smart metering goals are hindering efforts to standardize communications protocols and feature sets. While vendors battle over standards, utilities and policy makers are moving forward anyway—despite the potential for setbacks.

Building the iUtility

Market forces are transforming the IOU business model.

As market forces transform the IOU business model, Apple’s iPhone provides a metaphor and possible example for the industry to follow. The iUtility will emerge as companies renegotiate the regulatory compact and reinterpret the traditional rate formula.

Inclining Toward Efficiency

Is electricity price-elastic enough for rate designs to matter?

Contrary to conventional wisdom, electricity demand isn’t immune to price elasticity, and rate designs can encourage conservation. In particular, inclining block rates coupled with dynamic pricing can cut electric use by as much as 20 percent.

Demonstrating the Smart Grid

Pilot projects clarify the vision of an intelligent utility system.

Pilot projects are bringing the future vision of the grid to life. Whether leveraging existing systems or rebuilding entire networks in a Big Bang rollout, new technology applications suggest an intuitive electrical network may not be far off.

2008 CEO Forum: Conservation Compact

Utilities test new models to encourage investments in efficiency and conservation.

The industry is struggling to reconcile legacy business models with emerging green priorities. CEOs at Green Mountain Power, Progress Energy, IDACORP, Pepco Holdings, and Reliant Energy explain their perspectives on financing investments in conservation and efficiency.