From pages 22 and 66 of February’s Public Utilities Fortnightly, excerpts from an article by Ohio PUC Chair Asim Haque. See the complete article here.
“We also know customers want more. We can recognize the desire for more technology using our smart phones and ground-breaking services like Siri, Alexa, and one-hour shipping, but equivalent strides in innovation have not made it to the electric sector.
As customer demographics continue to shift, the same old service from our electric utilities has grown unacceptable. Millennials, our newest comers to the bill-paying economy, are used to interactive experiences with their service providers and have come to expect it.
With utilities seeking to modernize and customers expecting more, what remains to be seen is whether there will be governmental will to act both as a partner and guardian.
Through PowerForward, Ohio expresses its will to both be part of the revolution, and to serve as a protectorate to ensure that customers are safeguarded as we collectively explore unchartered waters in the state. I view it as a responsibility incumbent upon us as public servants.
From the onset, PowerForward has been built upon two pillars. The first is innovation, both technological and regulatory. Let’s make sure our service providers are providing innovative products and services, and let’s also make sure that regulators are creating an environment that is allowing those innovations to flourish.
The second pillar is that any policy recommendations adopted by the PUCO must serve to enhance the customer electricity experience. Plain and simple. With so many distractions in the world of energy regulation, we need to remember customers are our core constituents. This means that advancements need to provide true net value to customers.
Value to customers can be either active or implicit. Active value, like controlling usage in new and innovative ways, is obvious to the customer. Implicit value, such as reduced line losses, benefit the customer through increased efficiencies, but might not be as tangible. In both instances, innovation will yield value.
Last year the PUCO spent time first trying to understand the business case for advancing grid modernization. We needed to have the business case publicly stated, and we are now convinced that prudent investments in grid modernization can better the lives of customers.
Then we spent time understanding grid architecture and how modern technologies fit into both current and anticipated architecture. After all, state commissions are economic regulators at our core, not cutting-edge electrical engineers.
As the PUCO’s third iteration of PowerForward approaches in a few weeks, we are returning to our roots to explore ratemaking and regulation.
This is where the traditional economic regulator starts to geek out and get excited. During PowerForward: Ratemaking and Regulation, we will examine the roles and responsibilities of distribution utilities as they relate to distribution system planning, distribution system markets, and distribution system operations.
Specifically, where does the distribution utility fit in? How and where are other players involved, such as competitive retail providers? How do we make room for tech giants like Apple, Facebook, Tesla or Google?
Conversations around data management and cyber security are essential discussions as we talk about the future grid. Everything today is connected. Devices are talking to one another, and a trove of data is out there. Who needs that data? What data do they need? How is that data protected? How can regulators facilitate this so-called data marketplace?
Finally, how does the ratemaking and rate design paradigm of today fit in, or not fit in, with a future grid? States need to be ensuring the regulatory models and tools are encouraging growth in the right ways so that a future grid that enhances the customer’s experience can flourish.”
Is your organization impacting the debate as a member of the PUF community? Nearly two hundred utilities, commissions, consumer advocates, associations, agencies, professional firms and vendors are members. How about yours?
Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
E-mail me: mitnick@fortnightly.com