Last Word: The Great Challenge of the Electric Power Transition

2016 was the year that the U.S. installed its millionth solar array; storage started to become a game changer; and the Supreme Court ruled on the FERC 745 case, confirming distributed energy resources (DERs) are integral to our power system.

The beginning of 2017 finds us in the midst of an electric power sector transition challenging all industry stakeholders. The Smart Electric Power Alliance (SEPA) has actively embraced the industry’s shifting paradigms with our recent name change and expanded mission to facilitate the utility sector’s smart transition to a clean energy future through education, research, and collaboration.

What does “smart transition” mean? It means that effects of any change must be considered against all parties who will be affected, and decisions need to be made with input from a wider array of stakeholders. We must also understand that so-called “smart technologies” are not panaceas; deployment must include:

  • Better understanding of and proactive engagement with consumers, who want more choice in electric services and technology.
  • Enhanced planning processes to bring the transactive sophistication of bulk power system planning and operations to the distribution level.
  • Strategic, organization-wide commitments to integrate DERs, including reforms to regulatory approaches, standard operating practices, and organizational culture.

Utilities must also contend with more general challenges — shifting demographics of the U.S. workforce; changes in capital availability and cost; new threats to grid reliability, such as cyberattacks; and concerns around data ownership and security. 

Another, very practical challenge is that new technologies must integrate seamlessly into our existing grid — a critical factor that some senior executives and policy makers assume is straightforward or trivial. But DERs will only realize their full value if they extend the functionality and capability of the transmission system to the distribution level, the meter and beyond. 

As SEPA expands our work from our historical focus on solar to DERs we will look for opportunities to eliminate roadblocks to grid modernization efforts now underway. Enabling technologies, such as advanced meters and communication systems, will play increasingly pivotal roles in DER deployment, but only if we ensure grid and DER interoperability.

The solutions we find together will make our industry stronger, more innovative and open to the ongoing changes we have yet to even imagine. We look forward to working with the energy industry to realize these new visions in 2017 and the years ahead.

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Julia Hamm is the president and CEO of the Smart Electric Power Alliance (SEPA), an educational nonprofit working to facilitate the electric power industry's smart transition to a clean and modern energy future through education, research, standards and collaboration. She is a frequent speaker at regional, national and international conferences and has authored numerous articles on the U.S. energy transition and the evolving role of utilities.   

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