Transforming from Ho-Hum to Always On

We face many challenges in our industry today, but our focus remains on supporting our members and turning these challenges into opportunities that improve people’s lives.

For decades our industry relied on fossil fuel sources to generate electric power. The generation fleet grew, and nuclear power generation was added for efficiency and to meet increasing demand. And we built an infrastructure — the grid — to deliver affordable energy. This model served us for many decades. But the landscape is changing.

Fossil fuel generation is under regulatory pressure to reduce carbon emissions. Wind and solar resources are being integrated into the grid. And consumer energy use is declining. The EPA has proposed an emissions reduction plan that will severely restrict fossil fuel generation, especially coal, at existing generation plants. It also promotes using more natural-gas fired generation, as well as renewable energy and consumer efficiency programs.

As we replace coal-fired generation with natural gas — the trend in the nation now — we may face more volatility in wholesale electricity costs and ultimately rates that consumer-members pay. Natural gas prices have been low and less volatile in recent years because we’ve seen an abundance of shale gas. But the lack of volatile natural gas prices today is not a guarantee that we won’t encounter them in the future.  Those supply and demand curves will certainly change.

More than 50 percent of the co-ops’ energy mix for making electricity comes from nuclear energy. We can count on our investment in nuclear generation to provide some stability in our costs.

In North Carolina, renewable resources, including hydropower, account for approximately 5 percent of the total energy supply. While we’re seeing lots of solar panels around us, we’re still only at 5 percent. But we do expect it to grow.  Installation costs for renewable systems are going down. But the fact remains that renewable energy is still more expensive than traditional generation resources. Also, solar and wind can’t provide a reliable and continuous source of energy throughout the day, making the need for traditional sources still very important.

The pace of growth in renewable energy for generation will be dictated by the resource costs, legislative policies, and incentives.

Technology has been an enabler for change in many industries, and ours is no exception. We have implemented maps online to inform members about outages and restoration. We have introduced real-time electric usage data and pre-pay metering to assist members with payment options and energy savings. These are just a few examples of how we have applied new technology.

Technology, of course, must be supported by the knowledge and expertise of energy professionals. Electric cooperatives are more than infrastructure. We are the trusted energy advisor that members count on.

Our advantage for realizing these opportunities comes from our mission:  to serve our members and improve quality of life in our communities. This is our guiding principle as we evaluate new technology and services.

As we transform from the Ho-Hum utility of 20 years ago to the Always-On utility of the future, we need to ensure that our people are educated, trained and able to make crucial decisions. North Carolina’s cooperatives are setting the trend among utilities nationwide. I am confident that we will look back on this period and see that we sailed the ship well during a tumultuous time.