Grid 2.03 min read
National trends and customer engagement are reshaping the electric industry business model and leading to the modernization of the electric grid. The increased use of distributed energy resources, emergence of new technologies, and the implementation of electronic measurement, control and communication systems are changing the industry. Known as Grid 2.0, technologies such as customer-sited solar generation and remote cellular data (or radio communication) that allows utilities to have two-way interactions with customers are driving a fundamental change of the electric grid.
Across the country, third parties are beginning to interact with customers on issues such as distributed generation and metering. This is a very critical issue to be aware of and it will be important for our members to stay ahead of this trend. We need to be proactive, but we also need to be smart.
AMP recently created a task force, the Focus Forward Advisory Council, to investigate and address many of these issues, including rate design, model ordinances and interconnection procedures. This Focus Forward task force is designed to provide guidance to members, and will educate them on important and timely issues as we prepare for grid modernization. The member-driven council includes elected and appointed members from a number of communities in AMP footprint states, AMP staff, attorneys, rate consultants and others.
In Ohio, the recent power purchase agreement between FirstEnergy and its unregulated affiliate that was approved by the Public Utilities Commission of Ohio (PUCO) requires FirstEnergy to undertake grid modernization initiatives, including developing net-metering tariffs, advanced metering infrastructure (AMI), distribution automation circuit reconfiguration (DACR), voltage/voltage-ampere reactive (Volt/VAR), and working with PUCO staff to attempt to remove any barriers for distributed generation. FirstEnergy’s new obligations will highlight and accelerate these issues in the heart of AMP’s footprint. We want to make sure our members understand that FirstEnergy agreeing to undertake efforts to automate its distribution system may very likely put pressure on them to adopt similar technology improvements to remain competitive. Similar grid modernization efforts are underway in New York, California, Minnesota and numerous cities throughout the country.
The Focus Forward Advisory Council will publish resources and tools for member use, and will periodically solicit input from member communities as these tools are developed in support of AMP’s strategic approach to future utility model developments.
For years AMP has relied on its members to take care of their wires back home, and communities have handled that side of the business very well with only ancillary support from AMP. We must now expand into a new mindset that supports members’ distributed generation and metering efforts. AMP hasn’t needed to focus on this aspect in the past because our members have provided such great reliability and service, but we are moving into a new era of the industry. It is a different dynamic and will require a fundamental change in the way members communicate with their customers.
AMP and its members need to be prepared. Part of the Focus Forward initiative is thinking through scenarios ahead of time to make sure good policies are in place – particularly for members who will need to work with their customers on rooftop or ground-mounted solar installations. If thoughtful policies are not developed in advance, members could face local struggles and potential legal issues. In addition, we want members to make strong decisions that thoroughly address safety issues in the event of an outage. It is important these decisions can be justified.
We know our members are busy and this is why we’re here; to help aggregate this work. The Board asked executive management and staff to set priorities and create an achievable first phase. The Focus Forward Advisory Council is part of this plan. We want members to be educated on industry issues and grid modernization. AMP has a talented staff that understands distribution, sustainability and technology. We are also working with the American Public Power Association and Smart Electric Power Alliance (SEPA), previously known as Solar Electric Power Association, to better enhance our sharing of information. SEPA recently launched the second phase of its 51st State Initiative, which is aimed at overcoming divisive debates in the industry by focusing on finding common visions and developing road maps for change that can be customized for local energy markets. These road maps for energy system transition are available online at sepa51.org.
The Focus Forward Advisory Council’s process will be ongoing and the issues it tackles will require AMP membership to work together in solving them.
This isn’t going to happen overnight, but other national initiatives are showing that grid modernization is a big thing – and it’s becoming a mandatory thing. AMP’s Board of Trustees believes this is a priority and an area where we should focus our efforts and concentration.
We believe this effort is so important that, in addition to the advisory council, the AMP Board has created a Focus Forward Board Committee and the topic will be a top priority at the 2016 AMP/ OMEA annual conference.
The Focus Forward Advisory Council will work to supply the information members need to provide local customer-focused electric service in this changing utility industry. We don’t have all the answers, but it’s important for us to be proactive, identify emerging issues and educate our members.