Welcome Scott Engstrom: New Expert in the Utility Management Community - [an Energy Central Power Perspectives™ Podcast]Posted to Energy Central in the Utility Management Group
- Oct 27, 2020 12:07 pm GMT
Leadership to guide the utility business may be at the highest priority its ever been in the industry, as rapidly changing technologies are being implemented at unprecedented speed, political action and regulations are stepping in more than they ever have before, and the foundational dynamic across utilities appears to be changing.
If these changes were happening in a vacuum of leadership, it wouldn’t be dramatic to suggest that chaos could be on the menu. But luckily, the utility industry has plenty of leaders that are helping to smartly and deliberately guide the sector on this new pathway. Identifying and amplifying the voices of those leaders is one of the most critical actions we take at Energy Central, and its why we’re proud to share the insights from our Network of Experts and continue to grow this network of experts so you can all benefit from the collective wisdom.
Today I have the honor of sharing with you a conversation I had with Scott Engstrom, the VP of Corporate Strategy and Business Development at GridX, Inc., and the newest established Expert in our Utility Management Community. Take some time to read the unique perspective Scott is able to share as a part of our Energy Central Power Perspective ‘Welcome New Expert Interview Series,’ and know that you can now look to him to chime in on the industry developments of the day:
Matt Chester: Our readers value these interviews as one of the easiest ways to get to know the experts we’ve brought into our communities, so let’s start broad. Can you please give a quick overview of your background? How did you get started in utilities, what experience do you bring to the table, and what is your current role?
Scott Engstrom: I have been in the utilities & power industries for 25 years. I started out as institutional investor and analyst investing on behalf of mutual funds and hedge funds in Investor Owned Utilities and other publicly traded power companies. A core part of the investment research I undertook was policy and regulatory analysis on a state-by-state basis. Legislative and regulatory decisions can have substantial impact on the value of these companies. Nine years ago, I was fortunate enough to co-found GridX, Inc. and my title is Vice President Corporate Strategy & Business Development.
MC: Utilities sit in a unique position compared with other businesses, both in how the market operates and in how customers interact with them. How does this positioning affect the right strategy for communications and billing with customers? Are there other industries you can take lessons from, or are utility providers on their own in this type of positioning?
SE: Indeed. Because utilities are granted monopoly franchises, they are in a unique position compared with other business. There are, however, multiple forces that have come to bear on utilities that are forcing them to think more like other product companies. These forces include deregulation of the supply business (in certain states) and the deployment of smart meters, often in conjunction with states pursuing Renewable Portfolio Standards (RPS) or other clean energy policy goals.
These forces are all combining to drive new utility rates, tariffs, programs, and business models. Even at utilities that are not feeling these specific forces, the pace of rate case filings and price changes has been increasing over this same time period. In sum, this means that utilities are being asked to provide rate, cost and bill analysis that is much more complex than any time before.
With interval data available, customers, particularly large commercial customers, now have a much more transparent view of how they are using utility services and, consequently, demanding that their utilities provide more granular and customized analysis about the options available to them. They also expect utilities to use whatever data is available and modern tools to help them budget for both actual events (price changes, rate case proposals) and hypothetical events (opening a new facility, adding behind the meter resources like solar or electric vehicles).
Providing this kind of personalized recommendations is exactly what the utility industry is being asked to do when critics and stakeholders point out the kinds of customer experiences that other companies, such as Netflix, Amazon, and Uber, are providing.
MC: You’ve spent a fair amount of time dealing with executives in the utility industry and major decision makers across the wider energy sector. What’s the most valuable lesson you think you’ve learned in your conversations with these people? And if you could share one lesson or truth with these professionals that they maybe don’t yet ‘get,’ what would that be?
SE: The most important lesson I’ve learned from utility industry executives is understanding the value of (and challenge of obtaining) broad stakeholder buy-in. Utilities can be very effective and actually accomplish much if they are able to establish broad coalitions of stakeholders to get behind the ideas and initiatives they are pursuing.
The "truth” that I would share with utility executives is that Smart Meters, Smart Grid, and behind-the-meter technologies are going to change their business and their business models faster than they want to believe. They need to prepare for rapid change and have products and services that are relevant to customers when these changes happen.
MC: After many years of being notoriously stagnant and filled with inertia, recent history seems to show that utilities are finally on board with modernization in many different ways. If you had to put your best guess on it, is there any specific development, deployment, or innovation that you think may take hold in utilities over the next 5-10 years that would have previously been unthinkable?
SE: I believe battery storage is going to fundamentally disrupt the industry faster than most are expecting. The combination of solar plus storage is going to change many, many customers relationship with their utilities - particularly very large and sophisticated customers.
MC: As you get more involved with the Energy Central community, what do you see is the value of a community like Energy Central? And on the flip side, what value do you think you’ll be able to bring to the community?
SE: One great thing about our industry is the willingness to share best practices and the shared commitment to safe and reliable service. Energy Central is a fantastic hub for exchanging best practices and encouraging industry participants to consider emerging trends and forces. For me, I hope to share details about the great work our customers are doing to respond to the demands for better customer experiences and customer engagement - and share how GridX is helping them.
MC: Is there anything else you’d like our readers to know that you didn’t get a chance to touch upon above?
SE: The readers may be sick of me at this point, but as parting words I would just encourage Energy Central readers, particularly those that are serving utility customers, to not settle when they are considering how to upgrade and improve customer engagement and customer experience. There is very rich content in the data in their possession. They just need to work with the right partners to harness the value of that data for the kind of personalized and engaging content that will change the way their customers think about their company.
Thanks to Scott Engstrom for joining me for this interview and providing his experience and wisdom as an expert in the Energy Central community. Scott is available for you to reach out and connect, ask questions, and more as an Energy Central member, so be sure to make him feel welcome when you see him across the platform.
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