January 2014
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January 2014 EnergyBiz interview when asked if he were starting over in the power industry … PowerPoint PPT Presentation


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January 2014 EnergyBiz interview when asked if he were starting over in the power industry …

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January 2014 EnergyBiz interview when asked if he were starting over in the power industry …

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January 2014 EnergyBiz interview when asked if he were starting over in the power industry …

“I would put solar on rooftops. I would want the ability to deploy new technologies that lead to productivity gains in the use of electricity in homes and businesses. I would go after the monopoly that I see weakened over the last 25 years.  My goal would be to take customers away from utilities as fast as I could, because I think they’re vulnerable. Regulations will not be changed fast enough… The business model will not be changed fast enough.”

Jim Rogers,

former CEO Duke Energy


This is a significant threat to the future of North Carolina


What is wrong…

  • Antiquated regulatory scheme.

  • State sanctioned monopoly built around a market model that no longer exist.

  • System prohibits or resist new technologies and business models.

  • No free market efficiency or innovation


Antiquated regulatory scheme.

  • NCUC is seriously under resourced and overburdened with a regulatory system that is antiquated, passive, and overly broad

  • No free market focus or adaptive methodology for new technologies or business models.

  • No proactive regulatory component


State sanctioned monopoly built around a market model that is no long viable.

  • 75 year old model based on ever expanding energy demand and 1930 technology.

  • Regulatory scheme that does not rapidly adapt for new technology or business models.

  • Incorporates all the inefficiencies of monopoly markets and resist innovation.

  • Regulatory scheme that does not address the security of electricity and the vulnerability to modern threats.


Power demand is falling.


Prohibits or resist new technologies and new business models.

  • Private construction of generation. (2nd Cycle cost for ground mounted fixed tilt solar after 5 years…. 66 cents per watt)

  • Distributed generation vs mega generation construction.

  • Inclusion of decommissioning cost and fuel residue.

  • Inclusion of line loss or smart grid evolution


SOLAR

Capital cost per watt

(Ground mount, fixed tilt)

$1.85

No Fuel

Minor maintenance cost,

No fuel residue cost

Minor decommissioning cos

CONVENTIONAL

Capital cost per watt

(gas, coal, nuke)

$1.23 - $1.46

Not including:

  • fuel cost

  • maintenance cost,

  • fuel residue disposal cost

  • Decommissioning cost


No free market efficiency or innovation

  • Wasteful - No competitive efficiency

  • Rewards stagnation, not innovation

  • No comparative analysis of alternatives

  • Regulatory inertia

  • Institutionalized corporate mindset

  • No forward thinking strategy

  • Strong resistance to new players or technology


What is needed….

  • Stop the posturing and make our energy market a priority.

  • NCUC resources and revision including alternative and comparative analysis mission.

  • Utility separation into generation, transmission and distribution.

  • Delineation that utility regulatory authority ends at the meter. Free market on private side.

  • Strategy for introducing free market competition and efficiency into model.

  • Regulatory mandate of distributed generation


Stop the posturing


Power demand is falling.


Power Prices are rising


Adapt to market changes or embrace the economic sideline

  • Encourage new technologies

  • Encourage new business models

  • Encourage free market efficiency & innovation

  • Stop passive regulatory system- be proactive.


Keep your eye on the ball.

Companies have 49 other States they can go to and most are not regulated.


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