Issue link: https://nebusinessmedia.uberflip.com/i/1052372
10 Hartford Business Journal • November 19, 2018 • www.HartfordBusiness.com By Matt Pilon mpilon@hartfordbusiness.com C ell phone providers can easily account for every little bit of data you've used and how, in great, granular detail. But another utility businesses and individual consumers use — electric- ity — is distributed on a system that's practically ancient by comparison. For the most part, utilities have no way of regularly measuring what most companies or homeowners are up to, beyond the number of kilowatt-hours they're consuming each month. Mean- while, ratepayers also don't have a good way to monitor their own usage. That will likely change in the future. The question is: how fast? Policymakers, regulators, utilities and other stakeholders in Connecticut and around the country are grappling with how to plan for and implement a more modern — or "smart" — electric grid, which is the interconnected network that delivers electricity from producers to consumers. The vision is to use soft- ware, hardware and sensors to digitize a distribution system that was designed and built long ago, albeit with a few important upgrades along the way. New, potentially costly technology under consideration would allow the grid to: • Draw more of its power from non- polluting, intermittent sources like solar panels and wind turbines; • Reduce energy use through pricing and incentive mechanisms; • Reduce outages and restore power more quickly; • Prepare — should the day ever come — for a phase out of fossil fuels in favor of electric vehicles and efficient electric building heating systems. That latter change would drastically cut carbon-dioxide emissions, but also skyrocket demand for electricity, pre- senting major capacity challenges for electric grids that make it all the more important for utilities and regu- lators to prepare well in advance. "This vision, this future of energy, … you start to see this conversa- tion showing up in places we wouldn't have anticipated it, and being discussed with a sense of imminence and possibility from market players who see those waves coming," said Katie Scharf Dykes, chair of the Public Utilities Regulatory Au- thority. "Even just in the last year it's caused me to sit up a little straighter." PURA, which regulates the state's electric, gas, water and telecom utilities and has the authority to order modernization investments, has been discussing those heady topics with local utilities Eversource and United Illuminating Co. (UI) and numer- ous other stakeholders this year, but Dykes says those conversations have only just begun, and there are plenty of challenges to overcome. The debate is important to businesses, which already pay some of the highest energy costs in the country, because how and where they get their future power — and at what cost — could significant- ly impact their operations. To achieve the vision of a modern grid, utilities are going to need to spend a lot of money and figure out how to operate under new business models, all while making sure their biggest task — keep- ing the lights on — is not imperiled. There's also a concern about mod- ernization costs and how much will be borne by ratepayers. Utilities are urging a measured, deliberate approach. "I think customers, the companies, we want predictability, we want to be one step ahead of what the customers want, not 20 steps ahead," said Anthony Marone III, the CEO of UIL Holdings Corp., parent of United Illuminating, who was on a recent panel discussion moderated by Dykes and hosted by the Connecticut Power and Energy Society. Utilities will need to recoup their spending on modern new grid sys- tems, industry officials say. As a result, regulators want to identify new revenue streams and cost savings for utilities that could help offset poten- tial consumer rate hikes. "We're going to be looking very, very carefully at the cost of these invest- ments, but also just as carefully at the opportunities to maximize those dol- lars spent," Dykes said. She said a spike in electricity de- mand from electric cars, while a tech- nical challenge for the grid, could help Deep Think Connecticut, cautiously, weighs potential for modern electric grid Katie Scharf Dykes, chair of the state Public Utilities Regulatory Authority, talks at a recent Connecticut Power and Energy Society panel discussion about eletric grid modernization. Joining her were Anthony Marone III, CEO of UIL Holdings Corp., (center), and Roger Kranenburg, Eversource's vice president of energy strategy and policy (right). PHOTO | CONTRIBUTED One of the smart meters installed by United Illuminating. The southern Connecticut utility says more than 70 percent of its customers have smart meters, which allow for more frequent data that helps UI forecast electricity demand and restore outages quicker, among other benefits. PHOTO | CONTRIBUTED