Business Model for the Electric Utility of the Future

Energy and UtilitiesThe Business Model for the Electric Utility of the Future” was the topic of an October 8 meeting of the California Public Utilities Commission.  The meeting was called by the PUC to provide a beginning of deliberations for planning utilities of the future.  Three members of the Climate Change Team, Jan Blumenkrantz, Nancy Parker, and Bob MacDonald attended the PUC meeting.

The meeting began with a presentation on strategic thinking for the electric utility industry by Joseph Scalise of Bain and Company, consisting of a very broad and rather abstract list of the varieties of ways the utilities could go in the future. The second speaker, Greg Guthridge of Accenture, presented data on expectations of customers and how they may be moving toward preferences of more sophisticated service than just cheap energy. Last was a consideration of the regulatory issues that will arise as the growth rate in the industry continues to fall as energy use efficiency rises and more generation from alternative sources becomes available, presented by Mathew Rogers of McKinsey and Co.  Following, a panel of four executives from major utility companies (PG&E, Southern California Edison, San Diego Gas and Electric, and Southern California Gas Co.) answered Commissioners’ questions about what their companies are doing to adjust to the coming change in energy demand and delivery. The meeting concluded with questions from the audience.

Summary by Bob MacDonald

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