EnergyBiz - January/February 2008 - (Page 54) » Guidebook Michael Heyeck (Transmission & DisTribuTion auTomaTion) superconducting cable, among other technologies. But total DOE funding for transmission and distribution research and development is only a small part of what is needed. EPRI’s budget for it is even smaller. Where does this scenario leave us? American engineering in the utility industry seems to be impeded by the lack of regulatory reward for technological advancement and the need to be at “safe harbor” with reliability compliance. We also appear overly provincial with average technological advancement as an acceptable performance level. Just as the golden age of space The inspirational value engineering was driven in large part by an international space race, we must of the space program look beyond our own shores to assess is probably of far where our global engineering friends greater importance have taken significant strides that warrant recognition. to education than I have had opportunities in the past any input of dollars year to travel to both Asia and Europe, A whole generation analyzing engineering advancements in is growing up which their transmission grids. Their voltages are higher, their efficiencies more has been attracted to profound. Our complacency has once the hard disciplines again left us in the middle of the pack of science and and losing ground. India, Europe, South Africa, Brazil and others are ahead of us engineering by the technologically. romance of space. So where do we go from here? — ARTHUR C. CLARkE, We must take our grid to the next First on the Moon, 1970 level by adopting the ingenuity we demonstrated in the space program of the 1960s. Only by rewarding ingenuity will we attract the young engineering graduates, who see video game development and some other industries as their only frontier. We must involve engineers, both young and experienced, to collaborate with our global friends. We must also have a regulatory regime that rewards risk and consumer savings from technological advancements. The FERC has enabled these incentives, only to be trapped at the retail level. AEP advocates a regulatory regime that places all transmission above 300-kilovolt in the purview of FERC with retail pass-through rate adjustments. We must exercise caution to establish necessary reliability standards without impeding technological advancement. We must also engage one another, with collaboration from DOE and EPRI. With recovery of research and development costs, we must advance wide-area monitoring and control beyond the static systems of today. We have isolated intelligence in substations that can be captured to optimize and control the grid and to avoid or limit widespread blackouts. The electric utility industry in the United States is governed through regulation to protect consumers from risk. But as an industry, we can work within that regulatory framework to advocate research incentives that reward technological advancement rather than hinder it. We must make our concerns known in the political arena and work to create an environment in which we can once again embrace technological leadership as not only a goal, but a given. Michael Heyeck is senior vice president of transmission at American Electric Power. challenges of technological advancement supersede our responsibility to improve our quality of life and resolve societal issues through our engineering expertise. AEP continually looks for ways to maximize our research and development investment through collaborative efforts. We are proud of our technological and engineering partnerships with organizations such as the Electric Power Research Institute. We also have partnerships with product developers such as ABB. But we can’t stop there. We must continue to push forward on the technological as well as regulatory fronts that sometimes constrain innovation. The energy act of 2005 has enabled the Federal Energy Regulatory Commission to provide incentive rates for advanced technology. But where is the line drawn between that which we ought to do as engineers and that which we need such incentives to do? I believe we certainly ought to advance technology as part of our engineer credo. The measure for incentive rates should include two hurdles: the risks associated with the advanced technology, and the consumer savings enabled by the new technology. Even though incentive rates for advanced technology may be granted at the FERC, the realization may be impeded by trapped costs at the retail level. If state regulators do not facilitate the incentive rates for advanced technology, there is hardly an incentive to take the risks involved. Under the energy act’s mandatory reliability standards enforced by the North American Electric Reliability Corp. we may face additional risks. These stem from possible financial retribution if new technologies in some way temporarily risk compliance with reliability standards. The Department of Energy has several initiatives to fund advanced technology and we have collaborated with the DOE and others to further develop high-temperature 54 E n E rgyB i z January/February 2008
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