Carnegie Teams with Sumitomo for Grid-Scale Vanadium Flow Battery Storage


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Australian VRF Battery Market sees a commercial-scale solar and storage demonstration by Energy Made Clean, Sumitomo Electric, and TNG, integrating vanadium redox flow systems with microgrids for grid-scale renewable energy reliability across Australia.

 

Key Points

A growing sector deploying vanadium redox flow batteries for scalable, long-life energy storage across Australia.

✅ Commercial demo by EMC, Sumitomo Electric, and TNG

✅ Integrates solar PV with containerized VRF systems

✅ Targets microgrids and grid-scale renewable reliability

 

Carnegie Wave Energy’s 100 per cent owned subsidiary, Energy Made Clean, is set to develop and demonstrate a commercial-scale solar and battery storage plant in Australia, after entering into a joint venture targeting Australia’s vanadium redox flow (VRF) battery market.

Carnegie said on Tuesday that EMC had signed a memorandum of understanding with Japanese company Sumitomo Electric Industries and ASX-listed TNG Limited to assess the potential applications of VRF batteries through an initial joint energy storage demonstration project in Australia.

The deal builds on a June 2015 MOU between EMC and emerging strategic metals company TNG, to establish the feasibility of Vanadium Redox batteries. And it comes less than two months after Carnegie took full ownership of the Perth-based EMC, which has established itself as one of the Australia’s foremost micro-grid and battery storage businesses, reflecting momentum in areas such as green hydrogen microgrids internationally.

Energy Made Clean’s main role in the partnership will be to identify commercial project site opportunities, while also designing and supplying a compatible balance of plant – likely to include solar PV – to integrate with the VRF containerised system being supplied by Sumitomo.

The demonstration will be of commercial size, to best showcase Sumitomo’s technology, the companies said; with each party contributing to their core competencies, and subsequently cooperating on the marketing and sales of VRF batteries.

As we have noted on RE before, vanadium redox flow batteries are tipped to be one of the key players in the booming global energy storage market, alongside innovations like gravity storage investment, as more and more renewable energy sources are brought onto grids around the world.

The batteries are considered uniquely suited to on- and off-grid energy storage applications, and emerging models like vehicle-to-building power, due to their scalability and long asset lives, with deep and very high cycling capability.

Australia, as well as being a key market for battery storage uptake, has seen a recent grid rule change that could impact big batteries, and has been noted for its potential to become a top global producer of vanadium – a metal found in a range of mineral deposits.

A number of Australian companies are already active in the local vanadium redox flow battery market, including miner Australian Vanadium – which recently inked a deal with Germany battery maker Gildemeister Energy Storage to sell its CellCube range of VRF batteries – and Brisbane based battery maker Redflow.

Energy Made Clean CEO John Davidson said the signing of the MOU would bring key industry innovators together to help revolutionise the vanadium redox flow battery market in Australia.

“This strategic MoU represents a compelling three-way tie-up of an emerging miner, a manufacturer and an integrator to accelerate the development of a major new energy growth market,” Davidson said.  

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Sparking change: what Tesla's Model 3 could mean for electric utilities

EV Opportunity for Utilities spans EV charging infrastructure, grid modernization, demand response, time-of-use rates, and customer engagement, enabling predictable load growth, flexible charging, and stronger utility branding amid electrification and resilience challenges.

 

Key Points

It is the strategy to leverage EV adoption for load growth, grid flexibility, and branded charging services.

✅ Monetizes EV load via TOU rates, managed charging, and V2G.

✅ Uses rate-based infrastructure to expand equitable charging access.

✅ Enhances resilience and DER integration through smart grid upgrades.

 

Tesla recently announced delivery of the first 30 production units of its Model 3 electric vehicle (EV). EV technology has generated plenty of buzz in the electric utility industry over the past decade and, with last week’s announcement, it would appear that projections of a significant market presence for EVs could give way to rapid growth.

Tesla’s announcement could not have come at a more critical time for utilities, which face unprecedented challenges. For the past 15 years, utilities have been grappling with increasingly frequent “100-year storms,” including hurricanes, snowstorms and windstorms, underscoring the reality that the grid’s aging infrastructure is not fit to withstand increasingly extreme weather, along with other threats, such as cyber attacks.

Coupled with flat or declining load growth, changing regulations, increasing customer demand, and new technology penetration, these challenges have given the electric utility industry good reason to describe its future as “threatened.” These trends, each exacerbating the others, mean essentially that utilities can no longer rely on traditional ways of doing business.

EVs have significant potential to help relieve the industry’s pessimistic outlook. This article will explore what EV growth could mean for utilities and how they can begin establishing critical foundations today to help ensure their ability to exploit this opportunity.

 

The opportunity

At the Bloomberg New Energy Finance (BNEF) Global Summit 2017, BNEF Advisory Board Chairman Michael Liebreich announced the group’s prediction that electric vehicles will comprise 35-47 percent of new vehicle sales globally by 2040.

U.S. utilities have good reason to be optimistic about this potential new revenue source, as EV-driven demand growth could be substantial according to federal lab analyses. If all 236 million gas-powered cars in the U.S. — average miles driven per year: 12,000 — were replaced with electric vehicles, which travel an average of 100 miles on 34 kWh, they would require 956 billion kWh each year. At a national average cost of $0.12 / kWh, the incremental energy sold by utilities in the U.S. would bring in around $115 billion per year in new revenues. A variety of factors could increase or decrease this number, but it still represents an attractive opportunity for the utility sector.

Capturing this burgeoning market is not simply a matter of increased demand; it will also require utilities to be predictable, adaptable and brandable. Moreover, while the aggregate increase in demand might be only 3-4 percent, demand can come as a flexible and adaptable load through targeted programming. Also, if utilities target the appropriate customer groups, they can brand themselves as the providers of choice for EV charging. The power of stronger branding, in a sector that’s experiencing significant third-party encroachment, could be critical to the ongoing financial health of U.S. utilities.

Many utilities are already keenly aware of the EV opportunity and are speeding down this road (no pun intended) as part of their plans for utility business model reinvention. Following are several questions to be asked when evaluating the EV opportunity.

 

Is the EV opportunity feasible with today’s existing grid?

According to a study conducted by the U.S. Department of Energy’s Pacific Northwest National Laboratory, the grid is already capable of supporting more than 150 million pure electric vehicles, even as electric cars could challenge state grids in the years ahead, a number equal to at least 63 percent of all gas-powered cars on the road today. This is significant, considering that a single EV plugged into a Level 2 charger can double a home’s peak electricity demand. Assuming all 236 million car owners eventually convert to EVs, utilities will need to increase grid capacity. However, today’s grid already has the capacity to accommodate the most optimistic prediction of 35-47 percent EV penetration by 2040, which is great news.

 

Should the EV opportunity be owned by utilities?

There’s significant ongoing debate among regulators and consumer advocacy groups as to whether utilities should own the EV charging infrastructure, with fights for control over charging reflecting broader market concerns today. Those who are opposed to this believe that the utilities will have an unfair pricing advantage that will inhibit competition. Similarly, if the infrastructure is incorporated into the rate base, those who do not own electric vehicles would be subsidizing the cost for those who do.

If the country is going to meet the future demands of electric cars, the charging infrastructure and power grid will need help, and electric utilities are in the best position to address the problem, as states like California explore EVs for grid stability through utility-led initiatives that can scale. By rate basing the charging infrastructure, utilities can provide charging services to a wider range of customers. This would not favor one economic group over another, which many fear would happen if the private sector were to control the EV charging market.

 

If you build it, will they come?

At this point, we can conclude that growth in EV market penetration is a tremendous opportunity for utilities, one that’s most advantageous to electricity customers if utilities own some, if not all, of the charging infrastructure. The question is, if you build it, will they come — and what are the consequences if they don’t?

With any new technology, there’s always a debate centered around adoption timing — in this case, whether to build the infrastructure ahead of demand for EV or wait for adoption to spike. Either choice could have disastrous consequences if not considered properly. If utilities wait for the adoption to spike, their lack of EV charging infrastructure could stunt the growth of the EV sector and leave an opening for third-party providers. Moreover, waiting too long will inhibit GHG emissions reduction efforts and generally complicate EV technology adoption. On the other hand, building too soon could lead to costly stranded assets. Both problems are rooted in the inability to control adoption timing, and, until recently, utilities didn’t have the means or the savvy to influence adoption directly.

 

How should utilities prepare for the EV?

Beyond the challenges of developing the hardware, partnerships and operational programs to accommodate EV, including leveraging energy storage and mobile chargers for added flexibility, influencing the adoption of the infrastructure will be a large part of the challenge. A compelling solution to this problem is to develop an engaged customer base.

A more engaged customer base will enable utilities to brand themselves as preferred EV infrastructure providers and, similarly, empower them to influence the adoption rate. There are five key factors in any sector that influence innovation adoption:

  1. Relative advantage – how improved an innovation is over the previous generation.

  2. Compatibility – the level of compatibility an innovation has with an individual’s life.

  3. Complexity – if the innovation is to difficult to use, individuals will not likely adopt it.

  4. Trialability – how easily an innovation can be experimented with as it’s being adopted.

  5. Observability – the extent that an innovation is visible to others.

Although much of EV adoption will depend on the private vehicle sector influencing these five factors, there’s a huge opportunity for utilities to control the compatibility, complexity and observability of the EV. According to  “The New Energy Consumer: Unleashing Business Value in a Digital World,” utilities can influence customers’ EV adoption through digital customer engagement. Studies show that digitally engaged customers:

  • have stronger interest and greater likelihood to be early EV adopters;

  • are 16 percent more likely to purchase home-based electric vehicle charging stations and installation services;

  • are 17 percent more likely to sign up for financing for home-based electric vehicle charging stations; and

  • increase the adoption of consumer-focused programs.

These findings suggest that if utilities are going to seize the full potential of the EV opportunity, they must start engaging customers now so they can appropriately influence the timing and branding of EV charging assets.

 

How can utilities engage consumers in preparation?

If utilities establish the groundwork to engage customers effectively, they can reduce the risks of waiting for an adoption spike and of building and investing in the asset too soon. To improve customer engagement, utilities need to:

  1. Change their customer conversations from bills, kWh, and outages, to personalized, interesting topics, communicated at appropriate intervals and via appropriate communication channels, to gain customers’ attention.

  2. Establish their roles as trusted advisors by presenting useful, personalized recommendations that benefit customers. These tips should change dynamically with changing customer behavior, or they risk becoming stagnant and redundant, thereby causing customers to lose interest.

  3. Convert the perception of the utility as a monopolistic, inflexible entity to a desirable, consumer-oriented brand through appropriate EV marketing.

It’s critical to understand that this type of engagement strategy doesn’t even have to provide EV-specific messaging at first. It can start by engaging customers through topics that are relevant and unique, through established or evolving customer-facing programs, such as EE, BDR, TOU, HER.

As lines of communication open up between utility and users, utilities can begin to understand their customers’ energy habits on a more granular level. This intelligence can be used by business analysts to help educate program developers on the optimal EV program timing. For example, as customers become interested in services in which EV owners typically enlist, utilities can target them for EV program marketing. As the number of these customers grows, the window for program development opens, and their levels of interest can be used to inform program and marketing timelines.

While all this may seem like an added nuisance to an EV asset development strategy, there’s significant risk of losing this new asset to third-party providers. This is a much greater burden to utilities than spending the time to properly own the EV opportunity.

 

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How Hedge Funds May Be Undermining the Electric Car Boom

Cobalt Supply Chain for EV Batteries faces shortages as lithium-ion demand surges; Tesla gigafactories, ethical sourcing, Idaho cobalt mining, and DRC risks intensify pricing, logistics, and procurement challenges for manufacturers and investors.

 

Key Points

A network supplying cobalt for lithium-ion cathodes, strained by EV demand, ethical sourcing pressures, and DRC risk.

✅ EV growth outpaces cobalt supply, widening deficits

✅ DRC reliance drives ESG scrutiny and sourcing shifts

✅ Idaho projects and stockpiling reshape U.S. supply

 

A perfect storm is brewing in the 21st Century battery market.

More specifically, it's about what goes into those batteries - and it's not just lithium.

The other element that makes up 35 percent of the lithium-ion batteries mass produced at Tesla's Nevada gigafactory and at a dozen of other behemoths slated to come on line, is cobalt. And it's already in dramatically short supply. A part of the answer to the cobalt deficit is 100 percent American, and this little-known miner is sitting on a prime Idaho cobalt project that is one of only two that looks likely to come online in the U.S. and it's right in Tesla's backyard.

 

High-Energy Batteries Need More Cobalt Than Lithium 

If you've been focusing your investment on lithium supplies lately you've been missing the even bigger story. EV batteries need about 200 grams of refined cobalt per kilowatt of battery capacity. Power walls need more than twice that. Between March 2016 and April 2017, the cost of the cobalt in that mix nearly tripled. But it isn't just the price that's got manufacturers worried. It's the shortage of availability. Keeping gigafactories stocked with enough cobalt to run at capacity is the challenge of the decade.

Tesla, now with a $50-billion market cap, launched a $5-billion battery gigafactory in Nevada in January. By the end of 2017, it will have doubled the entire global battery production capacity. By next year, it will be producing more batteries than the rest of the world combined.

It is estimated that Tesla's gigafactory alone will need anywhere between 7,000 and 17,500 tonnes of refined cobalt every year.

Tesla used to buy its finished battery cells from Panasonic, which in turn got its processed cathode powders from a Japanese company, Sumitomo was processing its own cobalt in the Philippines. However, that facility is already running at capacity and couldn't even begin to handle Tesla's gigafactory demand. In other words, Tesla's supply chain is no longer secure. And that's just Tesla.

The EV market is fifteen times larger than it was five years ago. The market has experienced a comppound annual growth rate of over 72 percent from 2011-2016, with new sources like Alberta's lithium-laced oil fields drawing investment alongside cobalt. This year, analysts expect it to gain another 25-26 percent. Last year, global EV production grew 41 percent, and sales are up more than 60 per cent year to year.

In addition,the Iron Creek project isn't a new exploration property. It has already seen major historic exploratory work, including 30,000 feet of diamond drilling. Iron Creek has historic (non 43-101 compliant) indications of 1.3 million tons grading 0.59 percent of cobalt with encouraging indications of up to 10 million tons. The 'closeology' is also brilliant. It's right next to the only advanced cobalt project in the U.S., which has a resource of 3 million-plus tonnes of cobalt.

As the battery market hits fever pitch and the supply-chain bottlenecks become unbearable, homegrown exploration is the key-first-movers and first investors will be the biggest beneficiaries.

 

A Very Precarious Supply Chain 

Supply is already in deficit, and we're also looking at an anticipated 500 percent increase in demand, making EV battery recycling an increasingly important complement to mining. Analysts at Macquarie Research project deficits of 885 tonnes of this resource next year, 3,205 in 2019 and 5,340 in 2020.

Not only is demand set to wildly outstrip supply very soon, but current supply (50 percent) comes primarily from the Democratic Republic of Congo (DRC). Buyers are coming under increasing pressure to look elsewhere for cobalt as the U.S. moves to work with allies to secure EV metals through diversified supply chains. The DRC has a horrendous record when it comes to labor practices and human rights.

Ask Apple Inc.  The tech giant recently announced it would stop buying unethical DRC cobalt for its iPhones - and as such, it has been forced to look for new suppliers.

The perfect storm continues: Some 95 percent of the world's cobalt is produced as a byproduct of copper and nickel mining, where concerns about ethical sourcing have put a spotlight on Canada's role in sustainable nickel practices worldwide. This means that cobalt supply is dependent on copper and nickel mining, and if those commodities are uneconomic to mine, there are no cobalt by-product results.

Not only is US Cobalt one of the first movers on the All-American ethical cobalt scene, but it's also financed to advance its Idaho Cobalt Belt project, and hopes to prove up 10 million tonnes of cobalt resource.

 

The Dream Team Behind Pure American Cobalt 

The CEO of US Cobalt, Wayne Tisdale, is a legend in spotting emerging trends with impeccable timing and has created billions in shareholder value. He's already done it with uranium, gold and oil and gas, and his most recent homerun was in lithium, with Pure Energy. When it launched in 2012, lithium was selling for about $5,000 per tonne. Within 18 months, it had increased 450 percent.

His next bet is on cobalt.

Tisdale and his team at Intrepid Financial have, in recent years, created $2.7 billion in value by building and financing 5 companies in completely different industries:

  • Rainy River (gold) was worth $1.2 billion at its peak
  • Xemplar (uranium) hit $1 billion at its peak
  • Ryland Oil (oil and gas) sold for $114 million
  • Webtech Wireless (tech) was worth $300 million at its peak
  • Pure Energy (lithium) is worth $65 million (and counting)

The bottom line? There is no other commodity on the market right now that we need more.

Just watch what the hedge funds are doing with cobalt because it's unprecedented. The run on physical cobalt started in February in the least expected corner: Major hedge funds started buying up physical cobalt and hoarding it in order to gain exposure, resulting in a major supply shortage for the blue metal. Swiss-based Pala Investments and China's Shanghai Chaos have already hoarded 17 percent of last year's global production. At today's prices that's worth around $280 million. At tomorrow's prices, it will be worth a lot more.

When hedge funds start stockpiling physical cobalt, it sends its traditional buyers into a panic to secure new shipments. Since November, cobalt prices have rallied more than 100 percent, and this is only the beginning. As the cobalt supply problem grows, and EV giants and gigafactories continue to increase demand, a home-grown solution is at hand. As a first principle of investing, where there is a supply problem, there is a massive opportunity for early investors.

 

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Unilorin develops device to check electricity theft

Ilorin Electricity Theft Device delivers remote monitoring and IoT-based detection for smart meters, identifying bypassed prepaid meters, triggering disconnects, and alerting the utility control room to curb distribution losses and energy theft.

 

Key Points

A prototype IoT system that detects electricity theft, enables remote disconnection, and alerts utility control rooms.

✅ Remote monitoring flags bypassed prepaid meters.

✅ Sends alerts to utility control room with customer details.

✅ Enables safe remote cut-off to reduce distribution losses.

 

The Department of Electrical and Electronics Engineering, University of Ilorin, has unveiled a prototype anti-theft device capable of remotely monitoring and detecting customers stealing electricity.

The Acting Head of the Department, Dr Mudathir Akorede told newsmen on Tuesday in Ilorin that the device could also cut off electricity supply to the premises of customers stealing electricity.

”This will simultaneously send a message to the utility control room, and in light of rising ransomware attacks targeting power systems, to alert the system operator with such customer’s details displayed on the control panel,” he said.

Akorede said that processes of filing application for patenting the invention, in line with emerging IoT security standards for the electricity sector, had commenced through the university’s Laboratory to Product Centre.

The don explained that the device was developed by himself and some students of the Department, reflecting how university teams contribute to innovations like generating electricity from falling snow in the field.

Akorede said, “I gave the project to my undergraduate students; they carried out the project to a level and I took it over and brought it to a level that was up to standard.”

The Don further said,”The invention is now up to the standard that it can be patented.

“I have brought this to the attention of the Ibadan Electricity Distribution Company, although not officially, but if adopted, and as utilities pursue digitizing the grid strategies, the device would enable distribution companies to cut their commercial losses substantially.”

He said that the idea followed the discovery that most people use electricity without paying for it.

”A lot of people that have been able to get the prepaid meter, even though they can afford to pay their bills, still want to bypass this thing to steal electricity and this is not helping the companies.

“It is not helping all of us as a whole. If the industry should collapse, with emerging cyber weapons that can disrupt power grids underscoring systemic risks, everybody would bear the brunt of that problem and that is why the consumers too have to share out of the problem

“But this is not to say that distribution companies also do not have their share of the blame by not wanting to take on responsibilities such as faulty transformers.”

 

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UK must be ready for rise of electric vehicles, says ABB chief

UK EV Charging Infrastructure is accelerating as ABB and Formula E spotlight fast charging, smart grids, and public stations, preparing Britain for mass electric vehicle adoption with expanded capacity, reliable connectors, and nationwide coverage.

 

Key Points

The UK network of charge points, grid capacity, and services enabling secure, scalable electric vehicle adoption.

✅ ABB urges rapid rollout of fast chargers and smart grid upgrades

✅ National Grid forecasts up to 9m EVs by 2030 in the UK

✅ Government GBP 400m investment targets reliable nationwide coverage

 

The UK should speed up preparations for the rise of electric vehicles, according to the chief executive of ABB, the world’s largest supplier of fast-charging points.

Speaking as the Switzerland-based engineering firm became the first official sponsor of the electric street racing series Formula E, Ulrich Spiesshofer predicted a flood of consumer take-up of plug-in cars, noting how EV inquiries surged in the UK during a recent fuel supply crisis.

And he added his voice to warnings that Britain must move faster to make sure owners of electric vehicles are not stymied by a shortage of charging bays or cost concerns among consumers.

“E-mobility is unstoppable, it’s just a question of how fast and how deep it will be deployed,” he said. “The UK has a big population that really wants to contribute to a greener, more sustainable world. But there’s always a question of whether it’s quick enough. In the next couple of years, it’s in the interest of everybody to make sure the infrastructure is coming up.”

 

How green are electric cars?

He said this would include adding to the UK’s network of electric charging points, as well as ensuring enough energy capacity so that the grid can cope with rising demand.

There are 14,344 charging connectors in the UK, according to ZapMap, which charts the scale of the UK’s network.

Those charging points served around 132,000 plug-in vehicles at the end of 2017, but the National Grid has predicted that the number of electric cars could surge to 9m by 2030.

“In the next couple of years, it’s in the interest of everybody to make sure the infrastructure is coming up,” said Spiesshofer.

He welcomed the government’s budget pledge to spend £400m on improving the UK’s charging point network but warned that the power grid also needed to be ready to meet the increased demand, which many argue is manageable with proper management approaches.

Electric cars have been forecast to add about 18 gigawatts of power demand to the grid, the equivalent of six Hinkley Point C nuclear power stations.

Spiesshofer said he hoped ABB’s sponsorship of Formula E, which will last until 2025, would help spur interest in electric cars and lead to technological breakthroughs, even as the US EV boom tests charging capacity elsewhere.

 

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Montreal's first STM electric buses roll out

STM Electric Buses Montreal launch a zero-emission pilot with rapid charging stations on the 36 Monk line from Angrignon to Square Victoria, winter-tested for reliability and aligned with STM's 2025 fully electric fleet plan.

 

Key Points

STM's pilot deploys zero-emission buses with charging on the 36 Monk line, aiming for a fully electric fleet by 2025.

✅ 36 Monk route: Angrignon to Square Victoria with rapid charging

✅ Winter-tested performance; 15-25 km range per charge

✅ Quebec-built: motors Boucherville; buses Saint-Eustache

 

The first of three STM electric buses are rolling in Montreal, similar to initiatives with Vancouver electric buses elsewhere in Canada today.

The test batch is part of the city's plan to have a fully electric fleet by 2025, mirroring efforts such as St. Albert's electric buses in Alberta as well.

Over the next few weeks, one bus at a time will be put into circulation along the 36 Monk line, a rollout approach similar to Edmonton's first electric bus efforts in that city, going from Angrignon Metro station to Square Victoria Metro station. 

Rapid charging stations have been set up at both locations, a model seen in TTC's battery-electric rollout to support operations, so that batteries can be charged during the day between routes. The buses are also going to be fully charged at regular charging stations overnight.

Each bus can run from 15 to 25 kilometres on a single charge. The Monk line was chosen in part for its length, around 11 kilometres.

The STM has been testing the electric buses to make sure they can stand up to Montreal's harsh winters, drawing on lessons from peers such as the TTC electric bus fleet in Toronto, and now they are ready to take on passengers.

 

Keeping it local

The motors were designed in Boucherville, and the buses themselves were built in Saint-Eustache.

No timeline has been set for when the STM will be ready to roll out the whole fleet, but Montreal Mayor Denis Coderre, who was on hand at Tuesday's unveiling, told reporters he has confidence in the $11.9-million program.

"We start with three. Trust me, there will be more." said Coderre.

 

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Coal comeback unlikely after Paris climate pact withdrawal, says utility CEO

US Shift From Coal to Renewables accelerates as natural gas, solar, and wind power gain market share, driven by the Paris climate agreement, clean energy mandates, smart grid upgrades, and energy efficiency.

 

Key Points

An industry trend where power producers replace coal with natural gas, solar, and wind to meet clean energy goals.

✅ Shareholders and customers demand cleaner power portfolios

✅ Natural gas, solar, and wind outcompete coal on cost and risk

✅ Smart grid and efficiency investments reduce emissions further

 

President Trump once again promised to revive the U.S. coal industry when he announced his intention to withdraw the U.S. from the Paris climate agreement.

But that reversal seems as unlikely as ever as electric power producers, the biggest consumers of coal in the U.S., continue to shift to natural gas and renewable energy sources like solar and wind power. In 2016, natural gas became the leading fuel for U.S. electricity generation for the first time, responsible for 33.8% of the output, compared with 30.4% for coal, according to the U.S. Energy Information Administration, even as coal-fired generation was projected to rise in 2021 in the short term.

Nick Akins, the CEO of American Electric Power, one of the largest utilities in the U.S., says the preference for gas, renewables and energy efficiency, will only grow in response to increasing demands from shareholders and customers for cleaner energy, regardless of changes in national energy policy.

With 5.4 million customers in 11 states, AEP plans to spend $1.5 billion on renewable energy from 2017 through 2019, and $13 billion on transmission and distribution improvements, including new “smart” technologies that will make the grid more resilient and efficient, AEP says.

We spoke with Akins on Thursday, just after Trump’s announcement. The transcript is edited for length and clarity.

 

What do you think of Trump’s decision to pull the U.S. from the climate agreement?

I don’t think it’s unexpected. He obviously made the point that he’s willing to renegotiate or have further dialogue about it. That’s a good sign. From our perspective, we’re going to continue along the path we’re already on toward a cleaner energy economy.

 

AEP and the U.S. electric power industry in general have been moving away from coal in favor of natural gas and renewable energy. Will this decision by the Trump administration have any impact on that trend?

If you look at our resource plans in all of the states we serve, they are focused on renewables, natural gas and transmission, as declining returns from coal generation pressure investment choices across the industry. And big-data analytics improves the efficiency of the grid, so energy efficiency is obviously a key component, as Americans use less electricity overall.

Our carbon dioxide emissions in 2016 were 44% below 2000 levels, and that progress will continue with the additions of more renewables, energy efficiency and natural gas.

So, you don’t see coal making a comeback at AEP or other utilities?

No, I don’t think so. … You wouldn’t make a decision (to build a coal power plant) at this point because it’s heavily capital-intensive, and involves a longer-term process and risk to build. And, of course, you can add renewables that are very efficient and natural gas that’s efficient and much less expensive and risky, in terms of construction and operation.

 

Do you plan to close any more coal-powered plants soon? 

I suspect we’ll see some more retirements in the future, with coal and nuclear closures test just transition in many communities, and as we progress towards that cleaner energy economy, and consider the expectations of our customers and shareholders for us to mitigate risk, you’ll continue to see that happen.

But on the other hand, I want to make sure there’s an understanding that coal will remain a part of the portfolio, even though in rare cases new coal plants are still being built where options are limited, but it will be of a lesser degree because of these other resources that are available to us now that weren’t available to us just a few years ago.

 

Do you find yourself under more or less pressure from customers and shareholders to move to cleaner forms of energy?

I think there’s more pressure. Investors are looking for the sustainability of the company going forward and mitigation of risks … From a customer standpoint, we have some large customers interested in moving into our service territory who are looking for cleaner energy, and want to know if we’re focused on that. Some of them want to be supplied entirely by those clean sources. So, we’re clearly responding to our customers’ and our shareholders’ expectations.

 

What’s the solution for workers at coal mines and coal power plants who have lost their jobs?

Certainly, the skill sets of employees in mining and around machinery are transferable to other areas of manufacturing, like aerospace and defense. So, we’re really focusing on economic-development efforts in our service territories … particularly in the coal states … to bring coal miners back to work, not necessarily in coal mines but certainly (in manufacturing).

 

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