The possibility is slim that Ben Franklin could have imagined what his kite and key would turn into 260 years later. Now, the pace of innovation in our industry is on overdrive and as recently as 20 years ago, we didn’t foresee all of the vast technological changes that would be in place today.
I come from a professional background of information technology, and if ten years ago you had told me how similar my job then and my current job now would look, I probably wouldn’t have believed you. The fact is though; the three areas key to the future success of energy companies isn’t far off from that IT realm. Data analytics, operating agility, and smart technology, like energy storage, are taking over the utility landscape. Analyzing the vast amounts of data in today’s world has become crucial in deciphering the needs of our customers. The ability to receive real-time data from the grid has allowed operations to see exactly what customers’ needs are at every moment. This information not only increases power quality and reliability for customers, it also helps us better match power output to demand, which is increasingly important as the penetration of distributed generation increases on the grid. This type of information also helps our energy traders purchase energy more efficiently on the open market and gives us better insights for our long-range resource planning.
This information becomes exponentially more important when trying to influence customer behavior, whether through energy efficiency initiatives, rate incentives or other mechanisms. Last year, APS completed the transition of every customer – all 1.2 million of them – to new, modernized service plans. By structuring our time-of-use plans to send clear price signals in line with demand on our system, we incentivized customers on these plans to use less power during on-peak hours (3-8 p.m. weekdays). The result? We saw a noticeable drop in system-wide power needs in that window of time. This not only saved our customers money, but it helped curb the need to add as many new peak resources to our mix, as higher customer demand would have traditionally required.
Operating agility, namely the ability to see and react to real-time issues on the grid as they happen is crucial to maintaining reliability and keeping the public up to date and informed during outages. In 2017, APS made the switch to an Advanced Distribution Management System (ADMS). Using ADMS has not only made the lives of our operations team somewhat less hectic, it has also improved response times to outages. Being able to pinpoint system failures with more accuracy not only means we can initiate our response faster, but enables us to bring the correct tools and resources to the problem for quicker resolution. The future plans for the system include a fully automated outage map, which will reduce the risk of human error during data entry, particularly during large-scale outages.
It’s no secret that batteries are the future of renewable energy and the key to unlocking these clean technologies by making them a more reliable resource for energy companies and customers alike. In February, APS announced we would be installing nearly a gigawatt of battery storage on our system by 2025. This announcement is one of the largest of its kind in the world, and signifies just how committed we are to both the technology and making solar a crucial part of our 24/7 resource mix. With over 1.4 gigawatts of solar on our system, making us fifth in the country for solar penetration, we have a lot of incentive to make solar work harder for our customers. Storage, in all of its forms, including thermal and batteries, allows solar to work after sunset, helping to solve what we once thought was an insolvable issue. Energy companies must maintain a diverse resource portfolio to ensure reliable service, and having storage in the mix adds a new clean capability: capturing mid-day solar for redistribution later in the day when energy is in the greatest demand and most expensive. While lithium ion batteries tend to get the most attention, we have also begun testing the efficacy of customer-side thermal energy storage. Some of our new programs in this space include thermal storage programs using grid connected water heaters and smart thermostats. These technologies are not only available to a greater share of our customers, but they also allow for more customers’ participation, to help reduce peak load on the system.
There is no doubt that the energy industry will continue to change drastically over the next few years. It is imperative to stay ahead of fast-changing customer expectations in a world where they are not only comparing their electricity provider to their other utilities, but to their most convenient and satisfactory customer experiences from online shopping and banking to ride sharing and food delivery. Not losing sight of our goal to provide clean, reliable and affordable energy to our customers, APS wants to continue to push the envelope on new technologies, to ensure we stay ahead of the curve and create a sustainable energy future for Arizona.