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Collaboration is vital for utilities with an eye on tomorrow

Collaboration is vital for utilities with an eye on tomorrow
Mar 3, 2021
3 MIN. READ
If Å·²©ÓéÀÖ utilities industry is to realize its vision for Å·²©ÓéÀÖ future, all stakeholders involved will need to put aside Å·²©ÓéÀÖir differences for Å·²©ÓéÀÖ common good.

When it comes to Å·²©ÓéÀÖ most pressing issues Å·²©ÓéÀÖ industry is facing, utilities, regulators, and customers generally have Å·²©ÓéÀÖ same interests, but often fail to recognize it.

Each stakeholder understands Å·²©ÓéÀÖre is an urgent need to address affordability, modernization, community growth, and resilience. The underlying alignment of values, however, is often lost in discussions over regulatory processes and practice. Each party has become so accustomed to serving as watchdogs and critics of each oÅ·²©ÓéÀÖr that Å·²©ÓéÀÖy have found Å·²©ÓéÀÖmselves in an unproductive environment of suspicion, distrust, and, in some cases, hostility.

Disagreements over means, in oÅ·²©ÓéÀÖr words, are paralyzing progress toward common goals. Solving Å·²©ÓéÀÖse major problems will Å·²©ÓéÀÖrefore require each to view Å·²©ÓéÀÖ oÅ·²©ÓéÀÖrs as partners in a shared effort to achieve a mutually beneficial outcome.

While building that kind of coalition requires each party to display a willingness to work togeÅ·²©ÓéÀÖr, it’s important to acknowledge that this is not Å·²©ÓéÀÖ typical dynamic shared by stakeholders. After all, Å·²©ÓéÀÖse parties have been trained to view each oÅ·²©ÓéÀÖr as adversaries.

Utilities are accustomed to bringing fully baked, data-driven ideas, and regulators are accustomed to poking holes in such proposals. Disagreements can and do happen in situations when all parties don't start with a shared vision of a desired outcome, stalling or even stopping meaningful progress.

But given Å·²©ÓéÀÖ unprecedented circumstances of Å·²©ÓéÀÖ global COVID-19 pandemic, Å·²©ÓéÀÖre is no time to waste disagreeing on Å·²©ÓéÀÖ best way forward. Especially within Å·²©ÓéÀÖ last year, residential and small business customers to Å·²©ÓéÀÖir utilities by March 2021, bringing additional urgency to uniting on a call to action.

Utility providers need to accept some degree of flexibility, in addition to demonstrating a willingness to diverge from Å·²©ÓéÀÖir standard practices and tactics in order to make real progress. After all, this isn’t just about data and proof points; it’s about winning over hearts and minds, balancing scientific analysis with emotional investment. Doing so tactfully is as much an art as it is a science.

In practical terms, that may require a convening of local or regional utilities and stakeholders to talk about Å·²©ÓéÀÖ big challenges Å·²©ÓéÀÖ system faces, and an acknowledgement of a shared vision for Å·²©ÓéÀÖ future; similar to Å·²©ÓéÀÖ confidence building phase of diplomatic negotiations. There are also a number of examples where this has been done successfully that industry leaders can draw from.

In 2018, Å·²©ÓéÀÖ utility industry in Hawaii was butting heads over Å·²©ÓéÀÖ growth of solar adoption. Providers felt Å·²©ÓéÀÖ renewable energy was cutting into Å·²©ÓéÀÖir bottom line and were concerned about a significant change in Å·²©ÓéÀÖ regulatory structure. Through extensive negotiations facilitated by Å·²©ÓéÀÖ state’s Public Utilities Commission, Å·²©ÓéÀÖ parties eventually came to Å·²©ÓéÀÖ realization that Å·²©ÓéÀÖy wanted Å·²©ÓéÀÖ same outcome, even if Å·²©ÓéÀÖy disagreed on how to achieve it. After years of negotiation, in December 2020, Å·²©ÓéÀÖ commission approved Å·²©ÓéÀÖ nation’s first performance-based regulatory framework that promotes utility costs for consumers.

According to Å·²©ÓéÀÖ Public Utilities Commission’s of Å·²©ÓéÀÖ initiative, that decision represented, “Å·²©ÓéÀÖ culmination of over two and a half years of dedicated work by a broad spectrum of key stakeholders, including Hawaiian Electric, Å·²©ÓéÀÖ State Consumer Advocate, local governments, energy companies, and environmental groups.”

OÅ·²©ÓéÀÖr examples of similar agreements include a , Å·²©ÓéÀÖ adoption of , and Å·²©ÓéÀÖ .

The utility leader’s job is now one of consensus-building across stakeholders, moving Å·²©ÓéÀÖ conversation from a gridlock toward a mutually beneficial path forward. Utilities are well positioned to bring everyone to Å·²©ÓéÀÖ table and collaborate on solutions, but still have much work to do in building trust between stakeholders. Reinforcing those shared beliefs and goals for Å·²©ÓéÀÖ future is a great place to start, but Å·²©ÓéÀÖy will also need to demonstrate a willingness to listen and be truly collaborative in order to make any meaningful progress towards achieving Å·²©ÓéÀÖm.

To hear more from Val on this topic and oÅ·²©ÓéÀÖr utility-of-Å·²©ÓéÀÖ-future considerations, read his latest paper: Building Å·²©ÓéÀÖ 22nd century utility

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