Postcards from DistribuTech
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The day began with a pre-dawn briefing and discussion on the data analytics front involving my colleagues from the Utility Analytics Institute and 50 industry folks attracted by the discussion and their interest in this nascent effort in the face of Big Data.
Several of the notions discussed in my piece last week, "Data Analytics for Smarter Grids," were brought up and scrutinized. That column looked at the article "Big Data, Analytics and the Path from Insights to Value" by Steve LaValle et al., first published in the MIT Sloan Management Review (Winter 2011) and serialized in blogs.
The article offered some general advice, including "starting in the middle." In other words, you don't have to have a perfect system full of complete data to begin crunching it for business intelligence, nor should you pick the proverbial "low-hanging fruit." You can extrapolate for gaps in your data and do some down and dirty analysis swiftly to see if something worth pursuing pops out. On Monday, my column, "Data Analytics: Start In the Middle," offered insights from a conversation with Lloyd Tokerud, senior manager of analytics for First Choice Power, a competitive retailer in Texas, who was hired from PepsiCo to lead the utility's analytics group. He confirmed that he has put the MIT Sloan article's tenets into practice for real-time action.
The notion is that a big, swift success in this regard can establish value and begin to build an organizational culture around advanced analytics and their place in the modern enterprise.
That's a long-winded setup for noting that several of yesterday's audience members were skeptical that hitting a home run on your first time at bat is possible or even wise to attempt. Utility-centric caution or pragmatism? I'm inclined to think it's the former, which might explain why it's likely that utilities will compete for practitioners from other vertical industries that have tackled Big Data first.
The consensus seemed to be that such efforts will be most successful if centralized within a utility organization, among other things, because that guarantees a "single version of the truth."
We dashed to the keynote session under cloudy skies. (Texas can use the rain.) Doyle Beneby, president and chief executive officer at host utility CPS Energy, the nation's largest municipal utility, said that his utility's future is inextricably linked to the future and economic vitality of the down-home city of San Antonio, where DistribuTech is being held this year.
Beneby explicitly linked economic development, renewable energy, clean tech, research-and-development and education as pieces of the puzzle that CPS and city leaders are assembling to create a new future.
Great rhetoric. But Beneby backed it up by naming new grid modernization projects under his utility's wing, as well as city-wide initiatives. The first list included pilot projects around smart meters and home area networks, the addition of ambitious amounts of solar photovoltaics and the construction of a combined cycle power plant that would achieve 90 percent carbon capture for industrial use elsewhere. The list of city-wide initiatives included converting streetlights from high-pressure sodium vapor lamps to LEDs and the introduction of electric vehicles both at the utility and charging stations around town. And, more impressively, Beneby cited the relocation of several companies' headquarters to San Antonio, presumably due to business-friendly policies, a modest cost of living and the beauty of southern Texas and its people.
These initiatives would provide a diversity of efforts and investment to shield the utility and the city against uncertainties in both the economic and regulatory realms, represent a $100 million investment with an estimated boost of $40 million in annual local payrolls, according to Beneby. On the surface at least, it sounded like a great partnership between a municipal utility and a city and a terrific American story in an age of declining expectations for the future.
Speaking of heady optimism, the actor/comedian Ben Stein, another keynoter, astonished the audience with the following statements about the criticality of electricity in our modern lives:
"You guys make us all into gods," he said, as heads in the audience turned to each other in bemusement. "And the grid is the `god machine.' Yet most people barely notice it. It's not only essential, it's cool!"
I heard a few folks LOL over that one, but maybe the audience needed to hear simple appreciation from a thinker, rather than more carping from regulators and customers, if only just for a day in San Antonio. Stein went on to recite a few passable jokes, but his attempt to make the industry feel refreshed about the importance of its mission probably was worth whatever crazy fee he was paid.
Lots of other insights from sessions later that day, but they'll have to wait until tomorrow or I'll be late for a very important date.
Intelligent Utility Daily