Incumbent utility policy

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Incumbent utility (generation, transmission, distribution) need to set policy with respect to overall North American trends. If they don't, there is no limit to the debt, distress, disgrace, disaster and liability that could occur. In addition they need to become cognizant of individual buying criteria that their customers apply increasingly to watts they purchase (e.g. preferring "no nuclear" or "no coal" or "no heavy oil"). Demand side management and home grid concerns like the implications of gigabit to AC outlets, home grids based on openHAN, IPTV, especially over BPL, demands that electricity demand management pays for broadband deployment, pressures of smart grid, home control, smart meter and power modem, electric vehicle and electric heat pump technology, and full cost accounting for total cost of operations are all going to radically impact major utility policies 2010 to 2020.

See why over BPL wins for more on the consumer's view of all of the above.

Leaving aside the generators and consumers, the distribution and transmission and open wholesale market concerns are the most difficult to unravel and understand but must be addressed first so that the generators and consumers have a predictable market in which to sell and buy. Five key concerns of incumbent utility policy in 2010 are:

  1. Culture change inside the utility is critical: Supply-biased language needs simply to disappear along with those addicted to it. It must not be heard from executives or those that have their ear. Advocates need to become hypersensitive to such framing:
    1. "low utility bills" are a legitimate goal, "low power rates" only subsidize waste especially if they are guaranteed through peak hours when they must be met at a deficit
    2. to "balance the grid" is the goal, not to "meet demand", a modern utility must be at all times vigilant to reduce demand and aggressively promote the reduction of demand, and eradicate waste
    3. because this reduces the revenue stream from selling watts, the utility must also sell negawatts directly, and in all other ways optimize revenue from not selling watts, or exploiting the control network that it has to build anyway for a modern grid:
  2. Revenue streams need to be opened that:
    1. Exploit the ownership of power poles but predictably so that fibre optic cable and rural BPL and 5G gear can be deployed by private investors seeking to make a profit, or leased to them by the utility itself which charges tariffs for moving bits
    2. Secure networks (bonded/authenticated/insured) must be built anyway for advanced metering infrastructure and third parties must be supported (by law in the US under US National Broadband Plan) to assist customers in energy demand management, so there is absolutely no reason not to overprovision them and gain more revenues
      1. The utility can become an ISP, telco, cable and cellco itself relatively easily but will often find regulatory barriers to this, and may be better off tariffing its fibre and powerline networking equipment and sticking to administering the secure network
      2. The utility can sell the actual appliances that enable conservation, or the monitoring and management services, but may be best off selling the light, heat, bits for communication, and owning the appliances and equipment to help keep this uniform
      3. The utility could actually own the risk (by selling insurance, financing upgrades or even mortgages) and systematically reduce this risk with system-wide upgrades (for instance, reducing fire risk with better detection of electrical fires via openHAN)
  3. Proving openADR and openHAN and ITU integration at low risk and cost preferably using volunteers in communities that have the greatest need for the services
  4. Because these communities are also often poor, they are best off enabled very early to prepare customers for time of use pricing especially variable dynamic pricing. Because of smart meter backlash poor communities should get energy demand management training and technology and opportunities first, before the more prosperous
  5. Wholesale markets in electricity need to be uniformly regulated in North America under FERC and NIST and IEEE standards with reference to ITU, IETF and other global standards. Legal constraints including UNDRIP provisions for the recognition of right of way or actual generating asset claims must be considered. Canadian provinces in particular must be wary of homegrown approaches and should stick to extending rather than daring to defy FERC, NIST, US DoE and other such mandates.

Utility avoid smart meter backlash when phasing in energy demand management.gif Utility revenue streams in smart grid era no debt.gif Utility escape regulatory capture by generators.gif Utility pilot project to prove openADR plus openHAN.gif Utility wholesale market FERC OATT UNDRIP.gif