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Electricity System Changes Coming Sooner Than Later

The electricity infrastructure of the United States is likely going to see a lot of changes and challenges in the coming years, according to panelists at the National Association of Regulatory Utility Commissioners' (NARUC) Winter Meetings.

Speakers at the meeting last week noted that the changes, which include increased renewable energy development, transmission construction, smart grid deployment, and the potential arrival of plug-in hybrid vehicles en masse, could be coming sooner rather than later following President Obama's signing of the stimulus legislation last Tuesday.

"The good news is there are some things that are happening...and happening quickly," said Garry Brown, chairman of NARUC's Electricity Committee and chairman of the New York Public Service Commission. "[On Tuesday], President Obama signed into law the stimulus package that is going to jump start a lot of these things: infrastructure, renewables and energy efficiency. On the heels of the stimulus package, very quickly coming down [the road] is some combination of another national energy bill and climate change legislation. The talk inside the beltway here in Washington is these things are coming and they are coming very quickly. It is going to change a lot of things."

With the focus on a "green economy," Brown said new technology -- such as plug-in hybrid vehicles -- are likely going to bring new challenges to the reliability of the nation's electricity grid. "If we replace much of our [automotive] fleet with something that plugs into our grid, that offers potential incredible advantages to the system, but there is also a lot of risk with that."

Brown asked, "How do you prevent people from coming home on a hot summer day around 4-5 p.m. and plugging in their electric vehicles, making our [electricity usage] peak go even higher? How do you ensure that it happens overnight when our wind resources are blowing?" He emphasized that it is important that all of the policies get implemented properly to make sure it is done right.

Addressing the necessary development of more electric transmission and distribution infrastructure, Brown said the investment process will be challenging. "By 2030, the electric utility industry will need to make an investment of $1.5-2 trillion. Its a big number, especially when all of these investments need to be made by the ratepayers of the electric industry around the nation," Brown said. "Our job as state regulators is that we accomplish all of this while at the same time not unduly burdening the ratepayers at a time when it is very, very tough."

Brown said it is going to be a matter of factoring in all of the variables in order to make it work. Even more difficult is factoring in the growth during a time of widely fluctuating prices. "In the last year, we've seen oil prices at $35 and we've seen oil prices at $140. We've seen natural gas at $12 and we've seen natural gas at $4." The key is moving forward "in a rapidly changing environment.

"The good news is this investment can help protect our fragile economy, can move us toward a green economy with new jobs to build the infrastructure and deploy the technologies" that will ensure the electric power system advances into the 21st century and ensures the reliability and national security of the system, while still installing clean energy for a low carbon future.

Southern Company CEO David Ratcliffe said that while the need for new infrastructure is obvious, the current grid system is far from broken. "We operate an extraordinarily reliable infrastructure," Ratcliffe told the audience. "Yes, there are interruptions and glitches, but when you look at the 99.9% reliability of the current infrastructure it is hard to say that we're anywhere close to having a third-world infrastructure.

"We certainly need more infrastructure. As somebody who is currently spending about $500 million a year on new transmission and distribution infrastructure, I don't feel like I am somehow short-changing [what is required]," Ratcliffe said. "What we have to do is expedite the process...and deploy [infrastructure] in the right places for the right reasons. The utility CEO said he believes the fact is sometimes missed that utilities are making "significant investments in new infrastructure and in modernizing the grid. It's not like we've been asleep for the last 20 to 30 years."

Ratcliffe did note that affordability plays a part in what gets built, noting that his engineers are tasked with finding new technology that the company can afford to implement and invest in. He emphasized that it is important to identify what is "technologically affordable" so that his company can still provide "reliable and affordable" service.

Dan Reicher, director of Climate Change and Energy Initiatives for Google.org, said that consumers have a large part to play in the reliability and efficiency of the future grid, if given the proper tools.

"Most consumers get a paper energy bill that they get through the mail in a very traditional way. They open it up...and very few people understand it," Reicher said. "They only things they really react to is how much they owe and where to send the check." Reicher said a smarter grid that provides consumers with "real-time" information about their own energy use "can fundamentally change things and drive the energy efficiency improvements that we sorely need in this country."

To help consumers help themselves by making smarter choices, Google recently unveiled free software that will provide consumers with real-time data on their electricity use. The Google PowerMeter, when it is rolled out likely later this year, will work on an iGoogle home page. However, the software will have to interface with a smart meter already installed in the home. Initially, the software will measure only overall household power usage, so comparisons can be made on an hour-by-hour or day-to-day basis. However, in the future it could have the ability to measure the electricity used by a room or a specific appliance.

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