Charting the Utility Future with Lessons from the Past: Discussion with CPS Energy’s Elaina Ball at the IEEE PES T&D Conference [Power Perspectives Conversations at IEEE PES T&D 2024]

The IEEE PES T&D Conference – Awaiting This All-Star Panel

Major Trends: Energy Transition, Load Growth, and Resilience

Thinking about the big-picture trends at the IEEE PES T&D Conference, Ball noted the energy industry’s grappling with a dual challenge of managing rapid load growth while navigating an ambitious energy transition.

“I’ve had a lot of conversations about load growth and energy transition. That’s what’s top of mind for everyone,” she said, reflecting the widespread concern among industry professionals. This tension is particularly pronounced in regions experiencing a surge in data centers driven by advancements in artificial intelligence and machine learning.

“We’re seeing a lot of large block loads in the form of C&I and artificial intelligence, machine learning, and large language models are driving data center growth at unprecedented levels.” – Elaina Ball

Balancing this growth with sustainability goals is no small feat. Utilities must ensure they can meet increasing demand without compromising their commitment to reducing carbon emissions. This balancing act is critical, as utilities like CPS Energy strive to serve their customers’ progressing needs while also addressing the broader imperative of environmental stewardship. The energy transition is not only about adding renewable energy sources, but also about integrating these sources into a grid that is increasingly stressed by new and substantial loads.

At the same time, integrated planning has become a cornerstone of modern utility strategy, particularly as companies face the twin pressures of increased demand and the need for greater resilience. Ball emphasized this point, stating, “It’s forcing us to really address and think about how we plan in an integrated fashion.” This approach involves considering current customer needs as well as anticipating future demands and potential disruptions. By adopting a holistic view, utilities can better coordinate efforts across different areas of operation, ensuring a more robust, responsive grid.

Impact of Distributed Energy Resources

The proliferation of distributed energy resources (DERs), particularly rooftop solar, is significantly reshaping the energy landscape and remains high on Ball’s radar. She highlighted the remarkable growth of rooftop solar in California, specifically in the San Diego area, as a case in point.

“In speaking with my peers in California, I had a significant takeaway relative to the adoption of rooftop solar in California, and in particular in the San Diego area about how it’s resulting in actual reductions in their peak load and energy supply,” she remarked. This trend underscores how DERs can not only supplement traditional energy sources, but also enhance grid efficiency and reduce strain during peak demand periods.

CPS Energy has seen substantial growth in rooftop solar among its customers, with over 300 megawatts (MW) of distributed generation – an impressive figure Ball acknowledged. The integration of DERs presents both opportunities and challenges, requiring utilities to adapt infrastructure and planning processes to accommodate decentralized energy sources effectively. The widespread adoption of DERs is a testament to the shifting dynamics in energy production and consumption, pushing utilities to innovate and advance continually.

Elaina Ball Sharing the CPS Energy Perspective

Lessons from Extreme Weather Events and Public Power Opportunities

The extreme weather events of recent years, in particular Winter Storm Uri for CPS Energy, have profoundly impacted how utilities approach grid reliability and resilience. For Ball, the storm was a critical learning experience that reshaped its priorities.

“Winter Storm Uri really galvanized our customer base generally to focus to send us the signal we want reliability first, affordability a close second, and clean in third place.” – Elaina Ball

This prioritization reflects a broader industry trend: ensuring the grid’s reliability has become paramount. The lessons from such events highlight the need for utilities to balance their efforts across multiple dimensions of the energy trilemma: reliability, affordability, and sustainability.

As Ball articulated: “If we can’t get the first (reliability) right, then we lose the confidence of doing the third (sustainability).” This insight shows the interconnected nature of these priorities and the necessity of a strategic approach that does not sacrifice reliability for the sake of other goals. Utilities must invest in robust infrastructure and adopt adaptive strategies to withstand future extreme weather events while progressing toward their sustainability targets.

That said, CPS Energy’s structure as a public power entity offers distinct advantages in addressing today’s energy challenges. Ball highlighted the benefits, stating, “One of the advantages of public power, and of CPS Energy in particular, is that we are vertically integrated and locally regulated for the most part.” This structure allows CPS Energy to plan with a long-term perspective, focusing on sustainable growth and customer service rather than short-term financial performance. This strategic flexibility is exemplified by CPS Energy’s recent decisions, such as making front-loaded investments to benefit customers in the long run.

“It allows us to lift our head up and plan on a longer horizon, and it allows us to make, like we just recently did, some front-loaded investments – which is going to save customers money on their bills,” Ball explained. By prioritizing long-term benefits over immediate returns, CPS Energy can make more prudent, impactful investments, ensuring they continue to meet customers’ needs while advancing their sustainability goals.

Driving New Technology, Innovation, and Energy Diversity

The rapid pace of technological innovation in the energy sector necessitates a cautious yet forward-thinking approach. Ball stressed the importance of not committing to a single technology prematurely, given the current landscape of rapid advancements and significant investment in research and development.

“It wouldn’t be prudent to put all of your money down on a single technology today because there’s so much research, development, and investment capital flowing into a myriad of technologies.” – Elaina Ball

This strategic patience allows utilities to remain flexible and responsive to emerging technologies that may offer more efficient or cost-effective solutions in the future.

“This also buys us some time to watch the winners emerge,” Ball added. By staying adaptable and avoiding long-term commitments to potentially obsolete technologies, CPS Energy positions itself to have the capability to integrate the most effective innovations as they become viable, ensuring they can meet both current and future energy needs efficiently.

Maintaining a diverse energy portfolio is crucial for mitigating risks and ensuring reliability. Ball emphasized the importance of this energy diversity, comparing it to a diversified financial portfolio. “Every single type of energy supply today has risks. They each have downsides, and they look different,” she explained. This diversity allows utilities to spread risk across different energy sources, reducing the potential impact of any single source’s failure or shortcoming. A varied energy mix, she added, is essential for minimizing risks and maintaining stability.

“Energy diversity is key to reducing and minimizing risks for your customer,” she said. By not relying too heavily on any one energy source, utilities can better manage the uncertainties and challenges inherent in the energy sector. This strategy will ensure they can provide reliable, affordable power while advancing toward their sustainability goals, and this approach is particularly important as the industry navigates the complexities of the energy transition, balancing new technologies and traditional energy sources to create a resilient, adaptable grid.

Conclusion: Charting a Course for a Resilient Energy Future

Elaina Ball’s insights at the IEEE PES T&D Conference shed much light on the intricate balancing act required to navigate the energy sector’s evolving landscape. As utilities grapple with the dual imperatives of reliability and sustainability, leaders like Ball are at the forefront of shaping strategies that harmonize these goals. Her emphasis on integrated planning, the prudent adoption of new technologies, and the critical need for a diversified energy portfolio resonates with the broader industry’s push for a resilient, customer-centric energy future.

As the energy transition accelerates, the insights shared by Ball and other industry leaders at the conference will be instrumental in guiding utilities through this period of profound change. The path forward is fraught with challenges, but with a collaborative and forward-thinking approach, the vision of a sustainable and resilient energy landscape is within reach.