US electricity sector weighs in on top challenges
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Renewable integration, ageing infrastructure and environmental regulations are stated as today’s top challenges, US electricity industry stakeholders have indicated.
The survey from Black & Veatch constituting its latest 2024 Electric Report and based on input from almost 700 respondents highlights the increasing frequency and severity of climate events, the more sophisticated and potentially damaging cyberattacks and the rise in data centres and their impact on demand and planning that are adding pressure to power providers.
However, while new federal funding and regulations have increased opportunity and incentives for the industry to modernise and become more sustainable, more than half of the respondents see regulation as a challenge.
“The 2024 Electric Report encapsulates a state of the industry that allows utilities to better understand how their peers approach modern challenges,” said Jim Doull, executive vice president, now leading Power Providers sector.
“While regulations and funding move forward, each electric utility may find itself following different paths when it comes to accessibility or prioritisation, and this report offers the necessary insight to understand what comes next in advancing the future of US energy.”
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Looking ahead to the next three to five years with the pressing need to upgrade and expand the grid, the top concerns cited are the changing generation mix with more utility-scale renewables and fewer traditional baseload units, supply chain issues and the regulatory lag in meeting the needs for system changes.
Other top concerns are the lack of qualified workers to engineer, maintain and operate the more complex energy system, the lack of sufficient transmission facilities and system control assets and the ability to invest in and maintain a more resilient grid.
The study states that with the push and pull of competing interests, many things on the industry’s ‘to-do’ list are nowhere close to cheap. So, who’s going to pay for it?
Under today’s regulatory models, utilities typically don’t have a way to recapture all the fixed costs required for critical upgrades, and ratepayers are likely to object to chipping in more for their electrons, making it even more paramount for utilities to present a thoughtful case to regulators or at least seek out outside guidance to help make that happen.
On cybersecurity the report states that once again, it takes money to fortify, thoroughly adopt and consistently monitor cyber protections while making needed investments in robust risk assessments and the latest technologies.
As with so many other things on the plate of US power utility stakeholders, it all starts with a plan that makes headway in incremental, manageable bites.
