In the January issue of South Carolina Living, we outlined some of the technological and regulatory issues reshaping the energy landscape for South Carolina co-op members. That same month, an industry newsletter titled Utility Dive asked thought leaders in the for-profit utility sector how they saw their businesses evolving in response to the same dynamics.
The article was eye-opening. What the experts predicted was a consumer-centric business model that might be considered radical for investor-owned utilities, but that’s been a part of co-op DNA from the beginning. Allow me to cite a few examples from the Jan. 28 article and offer my own commentary.
Utilities must engage their customers with information and new products
“There are multiple technologies that are creating disruptions in the old business model of [the] utility, including solar, storage, electric vehicles, many advances in home energy management,” says Abhay Gupta, CEO and founder of Bidgely, a utility analytics firm. “The customer will go to their utility looking for the right information….All of these things will tie seamlessly into either being offered directly by the utility, or by one of the partners of the utility.”
Gupta notes that the most important challenge for investor-owned utilities in this shift will be learning how to engage consumers and earn their trust.
As not-for-profit utilities that put the interests of member-owners first, South Carolina’s electric cooperatives already enjoy the trust of consumers. When these new technologies become available, cooperatives will naturally take the lead as expert advisers and, in some cases, the suppliers of goods and services.
The centralized grid will coexist with renewables, distributed generation and energy efficiency
“We believe the energy system of the future is one in which the current grid and central power generation coexists with distributed generation, renewables and energy efficiency,” says Chris Gould, senior vice president of corporate strategy and chief sustainability officer of Exelon Corporation.
I couldn’t have said it better myself. In South Carolina, electric cooperatives pioneered whole-house efficiency programs, helped pass a state law creating a level playing field for consumers seeking to install distributed energy resources (DERs), and were a driving force behind the creation of the Colleton Solar Farm—the state’s largest solar facility.
While we embrace DER technologies, co-ops also recognize that our current power infrastructure will be necessary to fill in the gaps. Electric cooperatives will still be obligated to provide power when DERs can’t meet the need, and we’ll play a vital role in integrating new and old energy sources to ensure that members always have safe, reliable and affordable electricity. Co-ops will be the backbone and the nervous system of the grid of tomorrow.
The industry must find a vision
For his contribution to the Utility Dive article, Karl Rabago, executive director of the Pace Energy & Climate Center, takes utilities to task for not seeing the bigger picture. “We need to keep this chronically insular industry open to infusions of new thinking,” he says, suggesting that utilities move to performance-based regulation and services.
A lack of vision might be true in the for-profit utility arena, but it certainly isn't the case for South Carolina electric cooperatives. Co-ops are guided by the vision of building stronger communities, and there’s nothing more performance-based than answering to your consumers—make that your friends and neighbors—at the co-op’s annual meeting.
Annual-meeting season starts again this spring, and this year tens of thousands of co-op members will attend to vote on board members and hold management accountable. This may be radical thinking to the for-profit utility world, but in co-op country, it’s the way we've done business for 75 years.
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