Department of Energy’s Second Quadrennial Energy Review

Written by: Mark Schuling, Consumer Advocate, Office of the Consumer Advocate of Iowa

Mark Schuling

The Department of Energy (DOE) is currently engaged in its second stage of its Quadrennial Energy Review (QER) process. The second installment is titled Electricity: Generation to End-Use. DOE is utilizing a formal stakeholder engagement process including a public meeting in Washington DC, followed by a series of six meetings in locations around the country to solicit input and foster public dialogue about the QER. The meeting locations were/are:

Washington, DC Public Meeting–February 4, 2016
Boston, Massachusetts–April 15, 2016
Salt Lake City, Utah–April 25, 2016
Des Moines, Iowa–May 6, 2016
Austin, Texas–May 9, 2016
Los Angeles, California–May 10, 2016
Atlanta, Georgia–May 24, 2016

I participated in the Des Moines Forum as a consumer representative. Additionally, the panels included fifteen stakeholder representatives from utilities, regional grid management operators, regulators, energy and environmental organizations, labor organizations, and consultants. The mixture of panel discussions followed by a public comment period resulted in multi-stakeholder discourse on electricity and its role in promoting economic competitiveness, energy security, and environmental responsibility.  DOE anticipates completing its report by November 2016.

The meetings consisted of three panels engaged in a robust discussion on the following topics. At the Des Moines forum, the discussions[1] included:

  1. Electricity Distribution and End Use: How Do We Manage Challenges and Opportunities?One of the objectives of smart grid deployment is to provide customers with better price and usage transparency. A portal allows customers to perform rate comparisons, see how their usage compares to other similar homes and businesses, and learn how to better manage usage and costs.Accurate measurement and verification (M&V) of energy efficiency savings is critical to the development of efficiency as a grid-level resource. By accurately measuring building energy use at the meter level, with proper adjustments for weather conditions, occupancy, and other factors, data analytics platforms can determine with a high degree of accuracy the consumption and load reductions actually achieved. This process enables utilities and other energy efficiency stakeholders to gain insights into actual savings achieved, as opposed to relying on databases of “deemed” or typical savings.To deliver the energy future customers desire, we must advance cost-effective clean energy through growing investments in renewable resources, including wind and solar, developing innovative customer solutions that provide flexibility and additional customer options, and modernize our system by building a smarter and stronger power grid.In the past rates were based on utility costs. Today, there are costs on both sides of the meter as well as benefits. Rates going forward need to be based on utility costs, customer costs, and benefits from customer generation to the utility system of generation and transmission.
  2. Bulk Power Generation and Transmission: How Can We Plan, Build, and Operate the Appropriate Amount for Future Needs?Organized markets will continue to play a significant role by making efficient unit commitment and economic dispatch decisions across a broad regional area. A well-organized market should also facilitate capacity market transactions to ensure an appropriate amount of resources are available to meet future load requirements. The organized markets should continue to work together to eliminate “seams” issues that exist between them, and should focus anew on interstate seams issues that may arise.The trend towards clean energy as old fossil fuel plants retire will continue because there is tremendous untapped potential, ongoing technological innovation, and demand for clean energy alternatives. Technological innovation is rapidly and dramatically changing the energy landscape. The cost of wind resources has fallen dramatically. Solar is particularly important as part of this discussion because it bridges the discussion of bulk generation and distributed generation and demand side resources. Energy efficiency has frequently been touted as the best, fastest and cheapest way to meet energy needs, and it has helped hold down demand and avoid the need for additional generation. Technological innovation has helped make that possible while continued innovation will open up new horizons for efficiency gains.Grid security has been a focus for some time now and continues to be a policy issue for regulators.
  3. Transmission Development with an Evolving Generation MixWe have seen and proven that transmission expansion done right can be a value-added enabler that increases reliability and reduces cost impacts to customers and ratepayers. In order to develop the best transmission system needed to accommodate an evolving resource mix, we need time, certainty, and acceptance. Having sufficient time to anticipate future needs, better certainty regarding policies that shape our future power grid, and consumer acceptance of the value transmission investment can provide will enable SPP’s and other planners’ ability to develop a transmission grid that maintains proper reliability at the lowest possible cost and generates myriad other benefits for the country.

The entire process can be reviewed at the DOE website. http://energy.gov/epsa/quadrennial-energy-review-stakeholder-engagement Available information includes written comments and transcribed remarks from the panelists. Public comments can still be submitted to DOE online at https://epsa.energy.gov/qer-comments/.

[1] Comments taken from panelists’ written or oral comments submitted at the Des Moines Forum and available on the DOE webpage.

Not Your Father’s Oldsmobile

Written by: Commissioner Scott Rupp, Missouri Public Service Commission

Commissioner Rupp

Oldsmobile’s are extinct.  Can that same phenomena being occurring right now in the energy industry?

Let’s face it, if your company’s marketing has to tell the public that your products are not the same as they were from generations ago, you are already doomed for the scrap heap of history.  Allowing your organization’s image to fall that far behind reality is unfortunate.  However there still are those in the energy industry operating under the motto that “utilities should be not be seen or heard, just always there.”  If the only time your customers interact with you is when they have a problem, or when you are trying to raise rates, or you are selling them a product, you have missed the opportunity to establish a relationship with that customer.

We live in a world of informed consumers, social media, and communication.  If you are not being transparent with information, communicating it, and helping to shape your own company image, the lack of information and communication will allow others to craft that image for you.

This is not just an issue for companies, but also for regulators.  When I first came on the commission it became clear to me that the public needs to be better informed.  Yet the more I wanted to communicate with the public and provide more transparency and information, the more nervous the legal dept. and others in the commission became.  “Commissioners are supposed to stay out of the news and not be heard from” I was told in many different ways by many different people.  The culture was one that words like “transparency” and “social media” made them nervous.  The more that I continued to try and educate people the more I realized just how far behind we had fallen in educating consumers about our industry.

For example, every time someone asks me what I do for a living, and I tell them that I am a Commissioner for the Public Service Commission, I usually get a blank stare in return as they rack their brain trying to figure out what that means. Even when I told most of my friends that I was now a Commissioner, almost all replied “Oh cool. Like in Batman.”  Those few who were not as comic book inclined, would reply “Oh, the Commish” relating to the 1990’s TV show starring Michael Chicklis. In the beginning I would try and explain the role of the public service commissioner and what we did and who we regulated, but after 30 seconds into my explanation I could see their eyes glaze over and the sound of “Bueller, Bueller, Bueller” echoing in their head.  The only thing they took away from the conversation is that I am not nearly as cool at Gary Oldman (who is the best Commissioner Gordon by far) and the only thing I have in common with Michael Chicklis, is his hairline.

Government bureaucracies are usually slow to adapt to change and typically have this type of apprehension in communicating directly with the consumer, so why are so many utilities still operating and communicating with their customers like they did when Oldsmobiles were still rolling off the production line?  I have had many interactions with companies and had asked them the question why they are not being more transparent, providing more education to customers and interacting with them beyond complaints and local public hearings.  What I have found is that it all boils down to the culture of the organization.

Let me give you some examples:

  • An electric utility customer had a complaint, and the engineers at the utility were able to fix it. They were pleased they identified the problem, troubleshooted it and found the solution all within 72 hours.  Yet 12 months later that same customer showed up and complained about the same problem at rate case hearing.  Why?  Because no one ever though to inform the customer that it had been resolved. They were all engineers and fixing the problem was the end of the solution. That was the culture that dominated the organization.
  • Another utility for years was getting customer complaint calls to their call center. The call center was instructed to tell them that the “proper” place to file a complaint was to contact the Public Service Commission.   The company was then surprised later on to find that they had an “F” rating at the Better Business Bureau.  The culture of that organization was not focused on the customer’s experience, just following the regulations.

It is after having many of those types of conversations that I decided that at the end of my six-year term, I want to look back and see a more educated and informed consumer, and a more communicative and transparent industry.  We all work in a fascinating industry that affects the lives of every person in this country on a daily basis.  It is now up to us to help our customers believe it too.  Oldsmobile’s were good solid well-built dependable cars, it just that no one was telling that to the modern consumer.

Of course not all companies are still using polaroid film to take pictures of their new Oldsmobile’s, while listening to 8 track tapes.  There are many companies that have recognized the need to change the culture of their organization and are taking steps to increase their communications with customers and become more transparent.  Some have dipped their toes into the waters of social media and some have dived right in.

I follow hundreds of companies on Twitter, FB, Linked in, Instagram etc., and some are hitting it out the ball park, and I give a well-deserved hat tip to those organizations.  However, I have seen other companies try and speak to their customers as if they were industry experts, sending out social media posts that had so many acronyms, that it looks like a toddler has just started pounding on the key board with the caps lock on.  We still have a long way to go of informing and educating the customer, but overall I am encouraged by the progress I am seeing.

A more informed, better educated consumer is a stronger customer.  And stronger customers become longer customers.

Comm. Scott Rupp has been on the Missouri Public Service Commission since 2014.  You can follow him on Twitter @Scott_Rupp, or read his weekly blog at www.scottrupp.com