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Utilities embracing decarbonization as they shed 'dinosaur' mentality


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Utilities embracing decarbonization as they shed 'dinosaur' mentality

As electric utilities increasingly embrace broad changes to the U.S. energy industry, they work to overcome cost concerns, skeptical environmentalists and regulatory hurdles.

"Some folks call our industry a dinosaur. And we can be that dinosaur ... or we can not only survive, but thrive," Adrian Rodriguez, senior vice president and general counsel at El Paso Electric Co., said April 16 at the Energy Thought Summit in Austin, Texas.

"We have to change. If we don't, change will happen to us," CPS Energy President and CEO Paula Gold-Williams said April 15 during a keynote address at the summit.

El Paso Electric illustrated its adaptation in late December 2018 when it announced it will use 200 MW of utility-scale solar, 100 MW of battery storage and a new a 226-MW natural gas unit at its 1960s-era Newman plant to meet future generation needs.

"We still need to have natural gas integrated into our system," Rodriguez said, pointing to gas generation as essential to reliability.

The El Paso Electric executive, however, noted that 50% of the utility's generation comes from its stake in the non-carbon-emitting Palo Verde nuclear plant.

About 20% of El Paso Electric's customer base is in New Mexico, where lawmakers have approved legislation with a goal of 100% carbon-free generation by 2045.

"That poses an interesting challenge to utilities," Rodriguez said. "What we are trying to do is make sure we are balancing this with our customer base."

CPS Energy, headquartered in and owned by the city of San Antonio, also is diversifying its generation mix by reducing its reliance on coal while adding solar and wind.

"We have to think global and apply local," Gold-Williams said.

The municipal utility shut down both units at its 840-MW J.T. Deely coal plant in December 2018, a decision made years before. In fall 2018, it began construction on a small solar facility combined with battery storage capabilities.

National Grid USA, which operates electric and natural gas utilities in Massachusetts, New York and Rhode Island, views decarbonization as "the right thing to do" but also has a legal obligation to meet ambitious state initiatives.

"We can't do it alone," Sheri Givens, the company's vice president of U.S. regulatory and customer strategy, said during a panel discussion.

Givens pointed to participation in the Regional Greenhouse Gas Initiative, a multistate carbon emissions cap-and-trade program, as an "essential" piece of the puzzle when it comes to reducing emissions.

Givens, however, also noted that there are challenges to emerging technologies and carbon-free electrification that require more education and access and better affordability.

"We need [electric vehicle] charging infrastructure," she said.

Givens also pointed to the Northeast's slower embrace of customer-focused technology.

"We still don't have smart meters in the Northeast, which is shocking to me," Givens said, adding that smart meters were deployed in Texas about a decade ago.