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Consumers. Innovation. Smart policy. And collaboration. Recurring themes during yesterday’s smart grid industry roundtable at GridWeek, where a group of eight energy thought leaders discussed imperatives for smart grid success.
Rising to the surface was the importance of consumer education, empowerment, and participation. "Smart grid is a participation sport," said Dick Kelly, CEO and Chairman of Xcel Energy, who stressed the importance of consumer involvement for smart grid success.
"The consumer seems to be the most left out in this discussion," said Michael Valocchi, Global Energy and Utility Leader at IBM. "But, the consumer is the one who pulls it all together in their usage."
The roundtable, which included thought leaders from EEI, GE, IBM, Cisco, and other leading smart grid organizations, was kicked off by Guido Bartels, Chairman of the GridWise Alliance, and Undersecretary of Energy, Dr. Kristina Johnson, who demonstrated her own commitment to the initiative by providing the 600+ person crowd with her email address, for those who wanted to write in with suggestions on how the government can further spur our transformation to a smarter grid, ultimately driving energy independence and economic competitiveness.
In Dr. Johnson's opening remarks, she described the government’s role in supporting innovation and vision, in driving inter-agency collaboration, and in funding successful smart grid models to demonstrate the benefits of smart grid technologies and to help expedite wide-scale deployments.
Following Dr. Johnson’s remarks, panelists each touched on specific topics, including demand response, innovation, standards and industry collaboration.
The first panelist, Thomas Kuhn, President of EEI, described some key drivers for the smart grid – one being efficiency, which historically has not been the industry's strong suit. "A lot of our [power generation] facilities are running only 10-15% of the time," he said. He suggested that with programs in place to help manage load, we have the opportunity to manage our generation assets more efficiently, and we may even be able to build fewer power plants.
But, to implement such programs effectively, utilities will require consumer participation.
The Importance of Consumers
Without consumers opting-in to certain smart grid programs, there will be minimal consumer, environmental, or societal benefit. However, before consumers ask for it, they need to understand it. "Customers weren’t clamoring for the internet at first because they didn’t know what it was," said Kuhn.
Moderator Jesse Berst, Managing Director of GlobalSmartEnergy.com, said, "Consumers will be the theme this year," contrasting that to the past few years, when the topic of smart grid conversation tended to center around technology.
Innovation Required
Most panelists agreed that much of the technology we need for smart grid success exists today. However, a new type of innovation is needed – innovation around new utility business models, for starters, especially as utility applications move inside the home. "The utility industry has historically focused on selling kilowatt/hours," said Bob Gilligan, Vice President of GE Energy’s Transmission and Distribution business. "The smart grid will require a transition to selling new services that customers welcome."
Smart policy will also be required to spur deployment of the smart grid. For example, how will utilities be compensated for encouraging consumers to use less of their product? This is a puzzle that continued to stump GridWeek panelists throughout the day.
"The technology has gotten to the point where it’s cost effective," Gilligan said. "But we need incentives in place. How are we going to change the incentive system so utilities are rewarded for selling less power?"
Smart Policy & Standards
In addition to the need for regulatory reform to reward utilities for improving efficiency, panelists discussed the importance of standards in driving smart grid success and innovation. Mark Munday, President and CEO of Elster, described the "diversity of applications and the diversity of companies" participating in smart grid, and the need for a common "language."
With a common language and a common platform, the innovation flood gates will also open, and entrepreneurs will likely rise to the surface.
Collaboration is Critical
There was also broad recognition that smart grid will not succeed without collaboration and engagement from industry, government, and academia. Dr. Johnson discussed the need for inter-agency collaboration – including FERC, NARUC and the DOE. Laura Ipsen, Vice President and General Manager from Cisco, reinforced the importance of collaborating across borders to leverage global expertise and partnerships to share best practices and drive true smart grid success.
As an industry that requires innovation and ingenuity, engagement of future smart grid leaders will also be paramount, particularly as many utility experts are approaching retirement age.
"Today’s best minds are building Facebook* applications and inventing new ring tones," Berst said. "Maybe we could use some of that brainpower in smart grid."
Our energy challenges will not be solved by one company, one individual, or one politician. They will require the collaboration and commitment from many of us working together, united by a common energy vision. If this year's GridWeek participation is any measure -- nearly doubling last year's delegate list -- our vision is becoming more and more unified.
*Facebook is a registered trademark and servicemark of Facebook, Inc. |
