Welcome!

Containers Expo Blog Authors: Liz McMillan, Yeshim Deniz, Elizabeth White, Zakia Bouachraoui, Pat Romanski

Related Topics: Containers Expo Blog

Containers Expo Blog: Blog Post

Achieving Regulatory Equilibrium

The shift to a distributed renewable driven grid

In the electric utility business, structural change is afoot.  If you are watching this all unfold in the regulatory hearing room, legislative chamber or the trade press you are familiar with the players in this drama.  You have the "technarians at the gate", SolarCity and its cousin Tesla Motors, numerous other residential solar suppliers and advocates calling for the shift to a distributed renewable driven grid.  On the other side is the establishment, the investor owned utilities who own and operate the electric grid that serve the masses.  The technarians seem to be the more modern, with the times contingent while the utilities are viewed as stodgy, unwilling to change and obstructionist.

Like most characterizations there are oversimplifications and the truth lies somewhere else.  You see for a century essentially the utility business was a quiet but important part of the infrastructure, utilities were natural monopolies that provided all facets of service to all customers in their territory.  And for decades business was very good, the economy post WWII was expanding rapidly, revenues expanded so much so that the cost of serving customers came down.  Since those days more and more of the business has been parsed out to independent power producers, later restructuring, and now the era of customer self supply (solar).  And we are now very much an energy efficient driven society and it has stamped demand for electricity considerably.  For many the policies of the recent decades are positive developments to protect the environment, diversify the resource base, and that is absolutely true, but there is more to the story.

The problem is that for the utilities they make a living selling and delivering electrons and operating the physical plant.  If the revenue continually erodes their viability erodes with it.  So if we want the utility compact, or as is in vogue, "business model" to be different, i.e., sell less product but don't degrade service, then the regulatory framework must be altered accordingly.  This issue is simple math, less revenues to cover given fixed costs becomes an issue sooner or later.  So far the solution has been to allow the utilities to still collect what they need by the trick of "rate decoupling".  The utility is kept whole in terms of the revenue they need to cover costs and return something to their shareholders.  But to apply decoupling means the unit rate must be increased and as that has continued customers have increasingly found solutions like rooftop solar to be attractive. Enter the heinous "death spiral".

So the new regulatory model needs to respond to the structural imbalances in the system, less focus on volume sales, more fee for service and per connection tied to capacity of the pipe borrowing somewhat from the fiber industry.  We are transitioning to the Grid of Things" where utilities will be valued more for their ability to interconnect than to sell electrons and rational rate setting and incentive mechanisms to encourage highly functioning networks will make all the difference.

More Stories By Forrest Small

Forrest Small is vice president of Grid Reliability at BRIDGE Energy Group, a consulting and systems integration solutions company focused on improving utility operational performance.

IoT & Smart Cities Stories
The platform combines the strengths of Singtel's extensive, intelligent network capabilities with Microsoft's cloud expertise to create a unique solution that sets new standards for IoT applications," said Mr Diomedes Kastanis, Head of IoT at Singtel. "Our solution provides speed, transparency and flexibility, paving the way for a more pervasive use of IoT to accelerate enterprises' digitalisation efforts. AI-powered intelligent connectivity over Microsoft Azure will be the fastest connected pat...
There are many examples of disruption in consumer space – Uber disrupting the cab industry, Airbnb disrupting the hospitality industry and so on; but have you wondered who is disrupting support and operations? AISERA helps make businesses and customers successful by offering consumer-like user experience for support and operations. We have built the world’s first AI-driven IT / HR / Cloud / Customer Support and Operations solution.
Codete accelerates their clients growth through technological expertise and experience. Codite team works with organizations to meet the challenges that digitalization presents. Their clients include digital start-ups as well as established enterprises in the IT industry. To stay competitive in a highly innovative IT industry, strong R&D departments and bold spin-off initiatives is a must. Codete Data Science and Software Architects teams help corporate clients to stay up to date with the mod...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...
Druva is the global leader in Cloud Data Protection and Management, delivering the industry's first data management-as-a-service solution that aggregates data from endpoints, servers and cloud applications and leverages the public cloud to offer a single pane of glass to enable data protection, governance and intelligence-dramatically increasing the availability and visibility of business critical information, while reducing the risk, cost and complexity of managing and protecting it. Druva's...
BMC has unmatched experience in IT management, supporting 92 of the Forbes Global 100, and earning recognition as an ITSM Gartner Magic Quadrant Leader for five years running. Our solutions offer speed, agility, and efficiency to tackle business challenges in the areas of service management, automation, operations, and the mainframe.
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, compared the Jevons Paradox to modern-day enterprise IT, examin...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors! In this blog post, we provide 7 tips on how, as part of our world-class faculty, you can deliver one of the most popular sessions at our events. But before reading...
DSR is a supplier of project management, consultancy services and IT solutions that increase effectiveness of a company's operations in the production sector. The company combines in-depth knowledge of international companies with expert knowledge utilising IT tools that support manufacturing and distribution processes. DSR ensures optimization and integration of internal processes which is necessary for companies to grow rapidly. The rapid growth is possible thanks, to specialized services an...
At CloudEXPO Silicon Valley, June 24-26, 2019, Digital Transformation (DX) is a major focus with expanded DevOpsSUMMIT and FinTechEXPO programs within the DXWorldEXPO agenda. Successful transformation requires a laser focus on being data-driven and on using all the tools available that enable transformation if they plan to survive over the long term. A total of 88% of Fortune 500 companies from a generation ago are now out of business. Only 12% still survive. Similar percentages are found throug...