IOUs

Investor-owned utility executives have long understood the benefits of prepaid metering, but technical and regulatory roadblocks have prevented wide-scale implementation. Now, however, two IOUs—Arizona Public Service and DTE—are planning prepaid metering programs that could be offered to all customers. Smart metering technology might pave the way for prepaid to become a standard service.

Is energy efficiency the answer to all our energy problems? The solution is more complicated than the hype would suggest. Only a practical approach can overcome barriers to capturing efficiency savings as a sustainable resource.

The smart grid is opening the floodgates on customer data, just as consumers are getting comfortable with retail self-service and mobile apps. With dynamic rates, distributed generation and electric vehicles just around the corner, big changes are coming in the utility-customer relationship. Will IOUs let upstarts control the new energy market?

Generation

Siemens Energy has been awarded an 18-month, $300,000 R&D program by the Illinois Clean Coal Institute to study the effects of coal and coal-derived syngas combustion on the behavior of material and coating degradation in utility boiler and gas turbine environments. Focus areas of the research program will explore materials degradation modes in integrated gasification combined-cycle (IGCC) systems and utility boilers.

The sweeping regulatory reform implemented in Michigan over the past year is often couched as a response to the economic crisis. Decoupling rates from utility profits, the reasoning goes, will remove disincentives to efficiency. Reducing the subsidies that commercial customers have long shouldered will ease their financial burdens. New renewable portfolio standards and wind generation initiatives will create green jobs and much-needed infrastructure.

In June 2008, the New York Public Service Commission (PSC) established the electric energy-efficiency portfolio standards for New York’s investor-owned utilities. In its order, the PSC directed utilities to file three-year energy-efficiency plans. Later that year, the PSC issued a supplemental order approving shareholder incentives for utilities successfully implementing their portfolios. If all goes according to plan, the six affected IOUs stand to earn about $27 million annually in performance incentives over three years. The structure of the incentive mechanism approved by the PSC presents risk factors that might affect utilities’ ability to realize the full earning potentials the mechanism offers.

Utilities traditionally have met renewable portfolio standards with power purchases from IPPs. But new approaches are allowing utilities to build their rate bases with investments in solar generation.

The future looks bright for distributed photovoltaics. New technologies and government policies are driving a revolution in PV manufacturing. But a robust national distributed generation system requires a grid that can accept two-way control of electrons.

When Pacific Gas & Electric broke the news six weeks ago that it had signed a deal with Solaren Corp. to buy 200 MW of solar energy from satellites launched into geosynchronous orbit, the idea seemed almost laughable. Solaren’s plan is to catch unobstructed sunlight falling on arrays of photovoltaic solar panels deployed in the crystalline void of outer space, and then to convert the generated electricity into radio-frequency energy for transmission to Solaren’s ground-based receiving station outside Fresno. Welcome to the new renewable reality.

A large regional utility forfeited significant operating revenues after it replaced pulverizers at several of its coal-fired power plants. Because the replacement pulverizers were sized to operate at 100-percent capacity during operations using the coal typically procured by the utility, upgraded plants had to be derated following a change to lower BTU-rated fuel. If utility decision makers had used a total cost of ownership (TCO) framework, they could have avoided this situation.