In the future, all cars might run on electric batteries, smart buildings could automatically adjust lights and temperature as needed, and wind and solar power could supply almost all the electricity needed to make it all possible.
That’s if you listen to the experts in energy, utilities, manufacturing electric vehicles, and public policy who convened at the Pearl Stable on Wednesday for a summit titled “Plug Me In: Smart. Connected. Electrified.” The summit was hosted by EPIcenter, an energy and technology think tank launched by CPS Energy and private-sector partners.
Keynote speaker Marlene Motyka, a partner with accounting and professional services organization Deloitte, described an “energy transition” taking place as a result of changing electricity use patterns, economically viable wind and solar power, and a growing call by utility customers to move away from fossil fuels to combat global climate change.
“All of these are disruptive forces that are transforming the industry but also creating new opportunities,” Motyka said
Motyka presented the results of Deloitte’s annual Resources 2019 report, a survey of 1,500 residential power customers and 600 businesses around the country. Deloitte’s polling found that 67 percent of residential consumers “are very concerned about climate change,” and 73 percent “see renewable energy as extremely/very impactful.”
However, when asked about what would influence them to change electric service providers, 85 percent said lower bills would be their primary motivation for switching, followed by 64 percent saying they would change providers to get better service. Only 55 percent said they would change providers to get electricity from renewable sources, such as solar, wind, and hydroelectric power.
“Climate is important, but cost is outweighing climate for some of our residential customers throughout the country,” Motyka said.
Attendees at the summit heard from some of the public- and private-sector entities that are pushing this change, with and without the help of electric utilities.
Jason Pittman, co-founder and president of Go Smart Solar, discussed his company’s partnership with CPS Energy to allow San Antonio customers to buy stakes in solar carports around the city. University of Texas at San Antonio Associate Professor Samer Dessouky talked about research being done at the university into roadways capable of converting the pressure of passing vehicles into electrical energy.
Electric vehicles are also a huge part of a transition away from fossil fuels. Attendees heard from representatives of Proterra, a manufacturer of electric buses. Outside the event, VIA Metropolitan Transit demonstrated one of its Proterra electric buses, which one driver said was “like driving a big golf cart.”
Car companies like Tesla and Toyota also made appearances. On stage, Toyota brand manager Nathan Kokes told the crowd about its plans to transition to making only carbon-free vehicles by 2050. The company is a key part of San Antonio’s industrial base because of its Southside manufacturing site that produces Tundra and Tacoma trucks.
“Toyota believes unequivocally in climate change, and we’re taking active steps to help protect the climate,” Kokes said.
The event also featured speakers from oil and gas giants, such as Shell and Baker Hughes, about how the energy industry is increasingly using equipment fueled by electricity in place of diesel and other fuels.
Absent from the agenda were San Antonio’s locally headquartered oil and gas companies – NuStar Energy and Valero Energy. The two have made known their opposition to the City-led Climate Action and Adaptation Plan, which calls for San Antonio transition away from gas- and diesel-powered vehicles by 2050, among many other steps.
During one panel, CPS Energy President and CEO Paula Gold-Williams, who also is serving as chair of the San Antonio Chamber of Commerce, spoke about the opportunity for these companies to profit from the shift away from fossil fuels. Gold-Williams called it a “fallacy” to think that “their business is lockstep and tied up in oil and gas and they have no motivation” to transition.
“They have shareholders who are customers who have changing preferences, and they see that disruption is happening,” Gold-Williams said, adding that such businesses “are looking for innovation and technology in their own supply chains” and that “we are basically seeing businesses drive this as an undercurrent.”
“It may not be evident to all of us because it’s part of their [research and development], it’s part of their long-term strategic plans, but we are getting a sense at the utility that every entity is thinking about how they can own, contribute, and lean into this process,” she continued.
The challenge for utilities is how to deal with that change and the threat it poses to their business model. Moderator Jan Vrins of Navigant Consulting posed this issue at a panel with Gold-Williams and Kerri Stewart, vice president and chief customer officer with JEA, the municipally owned utility serving Jacksonville, Florida.
“I think in general, most people believe that renewables are going to win the day,” Gold-Williams said, while adding that most customers also “want to make sure they have reliable power.”
CPS Energy has been rapidly growing its share of wind and solar, from 13 percent of its electricity generation mix in 2010 to 22 percent in 2018. However, it still generated 46 percent of its electricity from natural gas that year, with another 18 percent coming from coal and 14 percent from nuclear.
The utility has laid out its “Flexible Path” for expanding renewables to make up half of its mix by 2040, with 5 percent coming from energy storage and 16 percent from “flexible generation,” a placeholder for technologies that might not have emerged yet. It calls for 13 percent of power to come from natural gas, 7 percent to come from coal, and 9 percent from nuclear at that point.
The utility’s plan is somewhat at odds with the City’s climate plan, the draft version of which calls for San Antonio to move CPS Energy away from coal and natural gas by 2050. Citing climate scientists’ concern about runaway climate change if global emissions aren’t drastically reduced within 12 years, local environmentalists have called for CPS Energy to abandon coal by 2025, natural gas by 2030, and to phase out nuclear as quickly as possible.
However, Gold-Williams told the crowd that nuclear power via CPS Energy’s part ownership of the South Texas Project has made the utility’s transition to renewables possible.
“Our nuclear units have been the foundation of our system,” she said. “Because we were able to leverage what we had, we’ve been able to add in what’s new. I believe that for us to get to any semblance of zero-emission energy, you’ve got to utilize what you have as the leverage point to introduce these new technologies.”
Utilities have to grapple with changes in their power plant fleet even as their customers’ preferences change and businesses and residential users strive to use less energy overall.
Stewart, the utility executive from Jacksonville, told the crowd that the JEA faces “declining revenue” and is seeing residential and businesses customers want to move off the electric grid and generate their own power, often by using solar with backup generators. At the same time, the utility has to continue paying for its existing power plants.
“We have to have this backbone,” Stewart said. “They’re incredibly expensive to build and to maintain, but they must be there. … But as customers start to become more energy efficient, and as our customers start to defect from our grid … we’re struggling to understand where our customers are going so we can move with them.”
