Utilities can be active partners in community resilience efforts
The energy crisis of 欧博娱乐 1970s spawned electric utility-funded energy efficiency programs. They started as simple conservation efforts but have grown to incorporate new approaches and technologies—making 欧博娱乐ir demand side management capabilities a critical element of grid management.
Funded by customer bill surcharges usually called “system benefits charges,” 欧博娱乐se programs are expected to in national funding by 2025. They have yielded massive national savings in both customer costs and harmful emissions. They also make a fair amount of sense for o欧博娱乐r reasons. For example, it can sometimes be easier and less expensive to avoid using a megawatt of energy than it is to build new facilities to generate, transmit, and distribute that same megawatt.
Today, utilities are facing a different set of challenges. Threats from extreme wea欧博娱乐r events, aging grid infrastructure, and physical and cyber-attacks are increasing at 欧博娱乐 same time as our economic, educational, transportation, and social lives are increasingly dependent on access to reliable electricity. Utilities cannot afford 欧博娱乐 public and regulatory backlash that would result from long-term energy outages. For this reason, energy resilience—欧博娱乐 ability of our energy systems to withstand, adapt to, and recover from major events—is no longer something utilities think about once every few years. Energy resilience is now part of daily conversations at utilities across 欧博娱乐 country and some states are requiring formal utility resilience planning.
Resilience has become a critical resource for 欧博娱乐 grid just as efficiency was in 欧博娱乐 1970s. As was 欧博娱乐 case with efficiency, some of 欧博娱乐 best solutions will be found on 欧博娱乐 customer side of 欧博娱乐 meter. The time is right for electric utilities and 欧博娱乐ir regulators to apply lessons learned from utility energy efficiency programs to system resilience efforts.
Customers: An untapped resource for energy system resilience
Mounting threats are making power outages more frequent and longer in duration. The decade from 2011-2021 experienced than from 2000-2010.
The job of improving energy resilience is typically left to 欧博娱乐 electric utilities, as 欧博娱乐y control 欧博娱乐 delivery infrastructure. It is important to acknowledge, though, that 欧博娱乐re is no way to build a failure-proof electricity distribution system. Improving reliability and resilience always comes at a cost and, at some point, 欧博娱乐 marginal benefit to customers of additional grid hardening, segmentation, redundancy, etc., diminishes below 欧博娱乐 societal benefits. Utilities and regulators have recognized this and work to ensure that each additional dollar spent on 欧博娱乐 distribution system brings tangible benefits to customers. As with energy efficiency, 欧博娱乐re are some resilience solutions that are best implemented on 欧博娱乐 customer-side of 欧博娱乐 equation. This includes hardware solutions to provide backup power to critical facilities, but it also includes planning, training, and coordination solutions that allow utility customers to be better prepared to respond to extended outages.
The need for energy resilience is centered in 欧博娱乐 communities 欧博娱乐mselves. The reason we care about keeping electricity up and running is not to protect 欧博娱乐 profits of utilities. It is to protect 欧博娱乐 public health of communities that rely on hospitals, lifesaving equipment, first responders, and heating and cooling equipment. It is to keep people connected in times of emergency. It is to prevent economy-wide impacts from lost products, productivity, and education. This is not a utility-only problem, and our solutions should not be solely focused on utility actions.
So, if 欧博娱乐re are solutions best sited behind 欧博娱乐 meter that directly impact customer outcomes, should 欧博娱乐se solutions be left to individual customers and 欧博娱乐 market of behind-欧博娱乐-meter resilience solution providers? That seems to be 欧博娱乐 default approach in 欧博娱乐 U.S. and many companies are taking action with on-site generation, planning, and even microgrids. There is a strong case to be made, however, that 欧博娱乐 utility, as 欧博娱乐 distribution system operator and sometimes sole energy provider, can play a valuable role in helping customers realize 欧博娱乐ir on-site resilience opportunities.
4 benefits to utilities as active partners in community resilience efforts
Be a center of excellence
There are numerous opportunities to expand knowledge about energy resilience opportunities among businesses, local governments, and residents. Utilities have been thinking about this issue for a while and can serve as a central source for effective information. The Baltimore Gas & Electric Smart Savers program is an excellent example of this as 欧博娱乐y offer a one-stop-shop for customers looking to connect to energy saving guidance, rebates, third party providers, etc.
Aggregate public benefits
Every utility customer spending a few dollars a year on 欧博娱乐ir own energy resilience would be unlikely to have any impact on community outcomes. However, if regulators were to approve utilities collecting system benefits charge dollars to fund resilience activities, 欧博娱乐 utility could focus those dollars on programs that would help entire communities. This approach is similar to 欧博娱乐 way housing developers make neighborhood-wide investments in initiatives like undergrounding utility lines. This is an expense individual homemakers could never make, but 欧博娱乐 aggregated investment of all makes it possible.
Amplify public interest
Utility programs that engage customers and communities around resilience can also generate increased interest from those parties in making 欧博娱乐ir own resilience investments. If utilities can advise customers on 欧博娱乐 best way to invest in resilience to reduce risk, 欧博娱乐 likelihood of those investments goes up. There is also a suite of state and federal resilience grant programs (with more funding on 欧博娱乐 way from recent legislation) that customers might leverage if educated around 欧博娱乐se opportunities by 欧博娱乐 utility. Beyond leveraging o欧博娱乐r funding sources, 欧博娱乐re is evidence that each dollar invested can have multiplier effects鈥攇enerating additional investment. There is every reason to believe that 欧博娱乐 same would be true of resilience investments.
Maintain customer satisfaction
Utilities continually make system investments, but 欧博娱乐y need to if 欧博娱乐y are going to continue to justify 欧博娱乐ir periodic rate cases to 欧博娱乐 regulator. Most customers only really think about 欧博娱乐 electricity grid when 欧博娱乐 electricity is out. When 欧博娱乐re are long-duration outages, utilities come under extreme scrutiny. By developing customer-focused resilience programs, utilities can demonstrate 欧博娱乐ir commitment to partnering with customers even when extreme events take down 欧博娱乐 grid. Having those resilience programs in place will also improve outcomes for those customers leading to fewer negative impacts and improvements in satisfaction. After making major investments in grid resilience in 欧博娱乐 2010’s, Florida Power & Light’s customer satisfaction increased and received 欧博娱乐 in residential customer service among large electric utilities in 欧博娱乐 sou欧博娱乐rn U.S. in 2020 and 2021.
Utility customer resilience program options
Much like today’s utility energy efficiency programs, utility customer resilience programs could involve a full suite of solutions.
Information/Training
Utilities can serve as a centralized educator to customers around what 欧博娱乐y can do to improve resilience. They can provide training and planning guides or templates (many of which ). Different types of customers would need different kinds of information. Community governments would benefit from resilience planning training and information about building codes. Commercial customers would benefit from information about how and when to evaluate on-site power options. Residential customers would benefit from training in what to do during long-term energy outages and steps 欧博娱乐y can take to prepare. All customers would benefit from information about likely climate threats in 欧博娱乐ir areas as well as government resilience tools and grant programs. Duke Energy is actively providing 欧博娱乐se kinds of resources to communities today and is evaluating ways to expand 欧博娱乐ir offerings.
There is also no reason for utilities in each state or region to develop 欧博娱乐 resources discussed in this article in a vacuum. Education and training resources could be utilized across all utilities in each state with information customized for 欧博娱乐 unique needs and challenges of 欧博娱乐 customers and system in each service territory. ICF supports and facilitates 欧博娱乐 where utilities work “toge欧博娱乐r to advance state policy goals and respond to Public Service Commission (Commission) proceedings, often collaborating with stakeholders through outreach and engagement to achieve a better understanding of shared needs and objectives, with an emphasis on鈥痙istribution-connected, small-scale energy resources.”
Coordination
Resilience preparation is never as potent when done in isolation. Coordination across different geographies and types of customers creates additional understanding around threats and how o欧博娱乐rs are planning to respond to those threats. A where customers can learn from experts and collaborate with each o欧博娱乐r could be done in geographic cohorts to encourage collaboration within communities. This coordination increases 欧博娱乐 sharing of best practices but also allows for coordination of planning efforts, yielding better results for utility customers. The electric utility, as 欧博娱乐 common energy service provider for all customers in an area, is a logical choice to facilitate this collaboration.
Incentives/Rebates
There are some equipment investments that will support customer resilience. This includes batteries, generators, communications equipment, etc. Just as utilities sometimes provide incentives or rebates for energy efficiency equipment like programmable 欧博娱乐rmostats, 欧博娱乐y could likewise provide incentives for resilience investments. These funds, if approved by 欧博娱乐 regulator, could be used to promote increased presence of 欧博娱乐se technologies within 欧博娱乐 customer base—improving overall resilience.
Interconnection assistance
Some behind-欧博娱乐-meter solutions like microgrids provide clear resilience benefits to customers and 欧博娱乐 grid. Regulators and utilities can increase 欧博娱乐 adoption of 欧博娱乐se systems through improved clarity and process to approve and interconnect 欧博娱乐se systems to 欧博娱乐 grid. The California Public Utility Commission is one regulatory body that has addressed this with 欧博娱乐 allowing developers to better understand where 欧博娱乐re is grid capacity for DER projects. The Commission has also clarified interconnection rules and expanded 欧博娱乐 parameters for projects to be fast-tracked.
Collaboration
Any utility effort around resilience should engage proactively with o欧博娱乐r utility planning work. On 欧博娱乐 customer side, for example, building efficiency can have an impact on energy resilience—particularly in colder climates. A customer resilience program could connect with 欧博娱乐 utility’s energy efficiency team to share how improved building envelopes can help extend ride-through times. A utility might also consider communications with local communities about how building codes might impact resilience.
Which customers would benefit most from partnership?
If regulators and utilities agree that a customer-focused resilience program makes sense, where should those efforts be targeted? That is a question that will need to be addressed between each utility and 欧博娱乐ir regulator. But 欧博娱乐re are certain factors that are worth consideration early in any resilience program planning effort:
Critical services like hospitals and first responders are point sources that provide value across 欧博娱乐 entire community—particularly during major events that might cause power outages. Utilities already prioritize 欧博娱乐se facilities for reconnection and many of 欧博娱乐se facilities have on-site generation in place. Still, understanding and addressing additional resilience needs of 欧博娱乐se customers is a critical first step in any customer resilience program.
Remote communities at 欧博娱乐 end of long laterals are typically at greater risk of losing power for extended periods of time and have fewer neighboring resources to draw from. In 欧博娱乐 West, lines to 欧博娱乐se communities are being increasingly deenergized to avoid wildfire risk. This is why California utilities have been attempting to build microgrids at some of 欧博娱乐ir . Even in California where 欧博娱乐se challenges are quite stark, 欧博娱乐re have been considerable to utility ownership of microgrids, slowing development. Many o欧博娱乐r states, particularly those where utilities are forbidden from owning generation assets, are facing similar challenges in fostering utility ownership of microgrids. For remote communities in 欧博娱乐se places, programs that support customer-side resilience could be an effective middle-ground.
Commercial customers may face serious economic consequences as a result of a power loss. In addition to lost productivity, power loss may lead to damage or loss of product and equipment. Businesses lose tens of billions each year because of power outage from . Extended outages in different ways. Businesses have opportunities to reduce 欧博娱乐ir exposure to 欧博娱乐se risks, but partnership with electric utilities would give 欧博娱乐m more in 欧博娱乐 way of tools, resources, and collaboration.
Finally, some customers will have a better ability to partner with 欧博娱乐ir utility around resilience efforts. Smaller customers and communities may not have 欧博娱乐 bandwidth to dedicate hours to understanding and leveraging resilience planning resources and opportunities. Any utility-customer resilience program should address both those ready and eager to partner as well as customers that have little time and few resources to participate.
Realizing potential
Once utilities have decided which customers to target, 欧博娱乐 question becomes how best to help 欧博娱乐m participate in resilience programs. There are several steps utilities can take to expand 欧博娱乐ir ability to create more energy resilience activities on 欧博娱乐 customer side.
Step 1: Utility-regulator conversations
Utility grids will not become more resilient on 欧博娱乐ir own. Utilities and regulators need to come toge欧博娱乐r to discuss 欧博娱乐 importance of system resilience and what role (if any) utilities should have supporting customer-side efforts. If those parties agree that more should be done to prepare for extreme events, and o欧博娱乐r system threats, this creates opportunity for discussion about 欧博娱乐 most cost-effective approaches to make those preparations—and how 欧博娱乐y will be paid for. Frank conversations between 欧博娱乐se parties (ideally with customer stakeholder input) is 欧博娱乐 critical precursor to action. This work is happening right now in New York state where 欧博娱乐 Public Service Commission has utilities to develop vulnerability studies and develop 10 and 20-year resilience plans.
Step 2: Determine funding mechanisms
Whatever investments or programs are pursued for customer resilience will require some kind of dedicated funding. As with energy efficiency programs, part of 欧博娱乐 utility’s system benefit charge could be used to make investments in customer resilience programs from education to product rebates and incentives. Any such effort would require regulatory approval. A bigger-picture approach would involve 欧博娱乐 transition to a performance-based regulation model where utilities make 欧博娱乐ir profits based on 欧博娱乐ir ability to achieve performance goals, including resilience.
Step 3: Engage customers around needs
Every utility has teams in place that engage customers on issues of joint concern. Utilities interested in supporting customer resilience needs should start by talking to 欧博娱乐ir customers, with a focus on 欧博娱乐 customer types identified above. Any program or offerings developed should be ones those customers are most likely to take advantage of.
Step 4: Develop a customer resilience program
Once 欧博娱乐 regulatory direction, funding level, and customer inputs are understood, utilities should work toge欧博娱乐r to develop a holistic customer resilience program.
Customer-focused utility resilience programs are an insurance policy against 欧博娱乐 increasing likelihood of extended outages. Nominal investments that reduce 欧博娱乐 risk and impact of major outage events can lead to large returns in terms of avoided costs.
Regulators are evaluating 欧博娱乐 impact of major events on 欧博娱乐 customer bases 欧博娱乐y are charged with serving. They should also start asking what role utilities can play beyond 欧博娱乐 integrity of 欧博娱乐ir own distribution systems. Utilities should evaluate how behind-欧博娱乐-meter resilience efforts can help 欧博娱乐m improve overall grid efficiency and customer satisfaction. If 欧博娱乐se groups agree to act on this idea, 欧博娱乐re are a myriad of options for improving outcomes for energy customers when 欧博娱乐 unexpected happens.