Released May 17, 2010 | CINCINNATI, OHIO
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Jim Rogers has no regrets. As the science underpinning climate change comes under attack, the chairman, president, and chief executive of Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina) said he has no second thoughts about making multibillion-dollar investments to build advanced coal-fired electric generators. Neither does he have any second thoughts about the utility's five-year, $1 billion investment in various "Smart Grid" initiatives designed to lower customer energy usage and optimize the performance of the company's distribution system.
In fact, Rogers sees the Smart Grid as a catalyst that will fundamentally change the way the electricity business operates. The U.S. electric generation fleet is aging, but advancements in electricity generation and various Smart Grid innovations in the distribution network means that aging generation need not be replaced on a megawatt-for-megawatt basis, Rogers told about 400 attendees at the Smart Grid RoadShow conference in Cincinnati on May 11. The event was sponsored by Jaguar Expo (Terrebonne, Quebec).
Rogers reiterated his message in a wide-ranging interview with reporters after his speech: "No regrets. We have to have the courage to push the edge of innovation, to push the edge of public policy conventional wisdom, and push the edge of technology deployment."
Somewhat ruefully, the Duke Energy CEO recognized that innovation carries risks: "There's a great West Texas expression that 'the pioneers get the arrows and the settlers get the land.' I don't mind being a pioneer on public policy, or on deployment of technology, or on changing the business model. I'm prepared to take a few arrows, and I've taken a few, but we need more industry leaders and regulators who are willing to pioneer these ideas."
Even if the science on climate change turns out to be "dead wrong," Rogers told reporters that Duke would still build a new integrated gasification combined-cycle (IGCC) generating station in Edwardsport, Indiana, at a cost of more than $2.5 billion. Duke also has no regrets about the decision to invest approximately $1.8 billion to build a new supercritical coal-fired generator in Cliffside, North Carolina. Both of these generators are scheduled to come online in 2012.
The Edwardsville and Cliffside projects are the cornerstone of Duke's strategy to modernize the company's generation fleet in the Carolinas and the Midwest. Bringing the Edwardsville and Cliffside stations online will add about 1,600 megawatts (MW) of state-of-the-art generation to Duke's portfolio. But the utility also plans to retire a total of 1,800 MW of older, less efficient, and high-emitting coal-fired generators. Beyond this, Duke would like to retire an additional 13 coal-fired units, which have a total generating capacity of 2,250 MW, over the next decade.
In addition to building Edwardsville and Cliffside, Duke also wants to build nuclear generators in Ohio and North Carolina, as well as two advanced gas-fired generators in North Carolina. Duke is building nearly 1,000 MW of windfarms in four states, as well as solar, biomass, and other sources of renewable generation.
But Rogers' vision also includes hefty investments in distributed generation--such as solar panels on customer's roofs--as well as a variety of distribution-system improvements that increase the performance and efficiency of the network. These improvements will facilitate a variety of customer energy-efficiency programs, which have a significant role in Rogers' vision for the electricity business. In one pilot customer program in South Charlotte, Rogers said customers were able to reduce their demand for electricity by 20%.
The Duke CEO noted that some utility customers and utility regulators, have pushed back against utility Smart Grid implementations. "This points to the need to educate customers, regulators and stakeholders," Rogers said. "We need to continue to work to communicate the value of Smart Grid investments."
Rogers said that advances in supply- and demand-side options also means that the industry will build more intermediate and peaking generation, and less base-load generation, in the coming years.
"We have the opportunity to totally reinvent our business," Rogers told the Smart Grid conference. "The mission of electric utilities has not changed--our purpose continues to be to provide affordable, reliable, clean electricity on a 24/7 basis. But the technology and the policy framework have changed, and they continue to change. Going forward, I see our role as the distributor of technology and the integrator of technology that creates value and improves our system. But I know that's easier said than done."
Rogers concluded his Smart Grid RoadShow keynote address by calling for more "cathedral" thinking: "Look at the European cathedrals that have stood for 400 or 500 years. They took 100 years to build. The architects didn't know the stone masons or the people who made the stained-glass windows, because cathedrals were built over a period of generations. But these magnificent structures were built because each generation that helped build those cathedrals was sustained by its faith and its shared vision of the future. We need more cathedral thinking today, and less short-term, quarter-to-quarter thinking by industry leaders."
View Plant Profile - 1516650 1011738
View Project Report - 11001886 15002083
Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
Rogers reiterated his message in a wide-ranging interview with reporters after his speech: "No regrets. We have to have the courage to push the edge of innovation, to push the edge of public policy conventional wisdom, and push the edge of technology deployment."
Somewhat ruefully, the Duke Energy CEO recognized that innovation carries risks: "There's a great West Texas expression that 'the pioneers get the arrows and the settlers get the land.' I don't mind being a pioneer on public policy, or on deployment of technology, or on changing the business model. I'm prepared to take a few arrows, and I've taken a few, but we need more industry leaders and regulators who are willing to pioneer these ideas."
Even if the science on climate change turns out to be "dead wrong," Rogers told reporters that Duke would still build a new integrated gasification combined-cycle (IGCC) generating station in Edwardsport, Indiana, at a cost of more than $2.5 billion. Duke also has no regrets about the decision to invest approximately $1.8 billion to build a new supercritical coal-fired generator in Cliffside, North Carolina. Both of these generators are scheduled to come online in 2012.
The Edwardsville and Cliffside projects are the cornerstone of Duke's strategy to modernize the company's generation fleet in the Carolinas and the Midwest. Bringing the Edwardsville and Cliffside stations online will add about 1,600 megawatts (MW) of state-of-the-art generation to Duke's portfolio. But the utility also plans to retire a total of 1,800 MW of older, less efficient, and high-emitting coal-fired generators. Beyond this, Duke would like to retire an additional 13 coal-fired units, which have a total generating capacity of 2,250 MW, over the next decade.
In addition to building Edwardsville and Cliffside, Duke also wants to build nuclear generators in Ohio and North Carolina, as well as two advanced gas-fired generators in North Carolina. Duke is building nearly 1,000 MW of windfarms in four states, as well as solar, biomass, and other sources of renewable generation.
But Rogers' vision also includes hefty investments in distributed generation--such as solar panels on customer's roofs--as well as a variety of distribution-system improvements that increase the performance and efficiency of the network. These improvements will facilitate a variety of customer energy-efficiency programs, which have a significant role in Rogers' vision for the electricity business. In one pilot customer program in South Charlotte, Rogers said customers were able to reduce their demand for electricity by 20%.
The Duke CEO noted that some utility customers and utility regulators, have pushed back against utility Smart Grid implementations. "This points to the need to educate customers, regulators and stakeholders," Rogers said. "We need to continue to work to communicate the value of Smart Grid investments."
Rogers said that advances in supply- and demand-side options also means that the industry will build more intermediate and peaking generation, and less base-load generation, in the coming years.
"We have the opportunity to totally reinvent our business," Rogers told the Smart Grid conference. "The mission of electric utilities has not changed--our purpose continues to be to provide affordable, reliable, clean electricity on a 24/7 basis. But the technology and the policy framework have changed, and they continue to change. Going forward, I see our role as the distributor of technology and the integrator of technology that creates value and improves our system. But I know that's easier said than done."
Rogers concluded his Smart Grid RoadShow keynote address by calling for more "cathedral" thinking: "Look at the European cathedrals that have stood for 400 or 500 years. They took 100 years to build. The architects didn't know the stone masons or the people who made the stained-glass windows, because cathedrals were built over a period of generations. But these magnificent structures were built because each generation that helped build those cathedrals was sustained by its faith and its shared vision of the future. We need more cathedral thinking today, and less short-term, quarter-to-quarter thinking by industry leaders."
View Plant Profile - 1516650 1011738
View Project Report - 11001886 15002083
Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
