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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
When Kennedy said we would send a man to the moon, people were doubtful this could – or
should – happen.
History may paint a rosier picture, but in 1969, only 47 percent of the public supported the
moon landing. They weren’t necessarily on board, but for the teams of scholars, researchers,
scientists and engineers working around the clock, failure was not an option.
There’s no set path to decarbonization and no single rocket ship that will get us there.
Although it’s a common goal, the players – utilities, governments, corporations and other
entities – are at different starting points, with different drivers, timelines, and levels of
complexity. Some have staked out aggressive goals, e.g., 100-percent renewable energy or a
zero-carbon footprint, while others are aiming for more intermediary steps, such as working
towards cleaner coal or relying on natural gas as a transition fuel toward a cleaner energy
future.
What is known is that decarbonization will require a colossal effort. Utilities know where they
want to go, and they know that a moon shot is necessary to get there – but the exact trajectory
remains unclear.
of change, increasing-price parity for new technologies, and new advances in electri cation,
decentralization and digitization. As a result, we’re seeing sweeping changes in how electricity
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
is produced. Coal continues to decline, dropping 18 percent in 2019, while natural gas has
surged ahead to become the No. 1 source of generation in the U.S.
Today, market players have more options than ever before, including large-scale solar and
wind, battery storage and associated technologies, the replacement of coal with natural gas,
and the advent of hydrogen power and next-generational nuclear energy. Utilities,
governments and corporations are evaluating these technologies as they build their “rocket
ships.”
These measures will get us 70 to 80 percent of the way there, but to make it to the moon, we
need new regulatory and market processes and evaluation of new technologies that are not
yet fully developed to meet 2050 goals.
There are a lot of potential solutions, and new ones are being added all the time. But utilities
will have to take an individualized approach based on their current situation. For example: Do
they own generation? Will they need to retire or make new investments? If they do not own
generation, are they going to invest in 100-percent renewable generation? Or are they going to
buy credits? How do state and national regulatory components need to change to support my
changing business? Where are the other market players?
Rapidly changing technology is also forcing utilities to address new issues. For example: In the
past, power flowed in one direction and optimization happened based on that scenario. Today,
distributed generation has spawned bi-directional power flows, introducing a slew of new
challenges when it comes to protecting and operating the grid. In addition, utilities must
include assets they often don’t own or control into their grid control and optimization strategy,
while still providing safe, reliable power to their customers.
Add to this list, increasing penetration of distributed energy resources (DER), growing
concerns over grid resilience and reliability, aging infrastructure, increasing load demands due
to growing electri cation, distribution modernization, increasingly connected (and vulnerable)
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
Data management will be critical. The ongoing digitization of the grid combined with the
influx of new market players and new digital assets is driving immense amounts of data being
collected by smart sensors and remote devices. Good data management comes down to
obtaining secure, reliable, timely, coordinated information from both utility and non-utility
assets, and aligning that data to tell meaningful stories. Considering the level of distributed
assets – with third parties owning, controlling and selling assets into the marketplace –
utilities are facing a different market model that will require unprecedented levels of
information sharing.
Move decision-making to the grid edge. All too often, there is latency in data transmission
caused by data traveling from a device to the centralized system for a decision to be made,
then returning that decision to the device. To remedy this, grid operators must havethe ability
to make decisions very rapidly, near the grid edge close to where operations occur, while still
relying on a centralized control system to provide oversight. Sharing information at the grid
edge will require a whole new level of communication and security infrastructure to protect
critical data and assets.
Improve visibility into distribution and transmission systems. Utilities must understand
what impact both utility and non-utility-owned assets are having to the distribution and
transmission grids. A collection of assets on the distribution side can cause instability on the
transmission side, and vice versa. Optimization can no longer occur on one system. Utilities
must understand how DER impact the grid, and access to the right data will be critical for
forecasting and alignment of load and generation at increasingly complex levels of granularity.
Advocate for regulation modernization. Regulators will be a key inflection point and new
utility business models will be required to help ensure an orderly transition to this new
marketplace.How much ability will utilities have to shape the rules of engagement? At this
point in time, utilities may be
responding to the market rather than leading it, but with data coming from all these different
sources, data integrity and security become signi cant issues. To mitigate this, utilities will
need to integrate with third-party participants. Utilities will also bene t from collective
advocacy for regulatory changes and structures at both the state and federal level that support
their evolving business models.
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
For one, business models and customer requirements will change. Loads will decrease as
customers deploy their own generation sources, even as utilities deploy solutions to address
customer’s evolving needs. To stay competitive, utilities will need to implement systems and
processes that help reduce operational costs, such as asset management, monitoring and
maintenance; predictive analytics; and automation, AI and machine learning.
Utilities will also need to develop trusted partnerships with regulators and advocate for
regulation modernization to support new utility business models. Left as-is, the current rate
structure will increase rates as utilities deploy the technologies that are required to address a
distributed grid.
possibility that the only customers left bearing the nancial burden will be those who can least
afford to generate electricity themselves. To mitigate this issue, the market needs new
regulatory models and rate structures that address the need to balance the costs of going from
the grid we have– to the grid we need.
Once the future grid is in place, utilities may see changes in the amount of infrastructure
required to produce and distribute energy; less infrastructure may be needed to meet
demand. For example, with more DER on the horizon, utilities may need fewer transmission
facilities. The market may not need larger substations – or more substations – if it generates
energy at the distribution level where it’s consumed. Utilities may end up with extraneous
assets that simply aren’t needed.
The relationship between utilities, customers, vendors and regulators will change and become
more collaborative, and new third-party players will continue to enter the market and deliver
the technologies needed to get to the moon. To address this, utilities will need to step up to
serve as an “ecosystem orchestrator” for markets and grid operations and become an active
participant in customer offerings.
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
When it comes to decarbonization, utilities have signi cant industry-changing goals. Although
the end game may be the same, no one trajectory will get utilities to where they need to be.
There will be best practices to adopt, as well as items to avoid. To build the best rocket ship,
utilities must realize a new path, one where they can share lessons learned and act in
cooperation while also dealing with the realities of complexity and competition.
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
modernization-enabling technology
solutions within the electric, natural gas
and water industry domains
Kevin Cornish
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Emissions
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Coal
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O&M
O&M
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26/3/2020 If carbon neutral by 2050 is the Moon Shot, where's the Rocket Ship? | Power Engineering
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