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Episode #59: 'Setting an Example for Utilities Everywhere via SEPA’s Utility Transformation Challenge' with Sharon Allan of SEPA, Debra Smith of Seattle City Light, Part 2 [an Energy Central Power Perspectives™ Podcast]

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The ‘Energy Central Power Perspectives™ Podcast’ features conversations with thought leaders in the utility sector. Each two weeks we’ll connect with an Energy Central Power Industry Network...

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  • Nov 11, 2021
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If you haven't first listened to part 1 of this 2-part episode, we recommend you start there first. 

The utility industry is a unique one in that the landscape of companies aren’t operating in a zero-sum competitive environment. Instead, utilities seek to share lessons learned, raise each other up, and collectively move towards the industry-wide goals of ensuring the entire country has access to reliable, affordable, and clean energy. It’s this collaborative environment and tendency to share best practices that makes leadership in utilities particularly important, as a success in one corner of the country can directly lead to the same type of success for a utility anywhere else. Recognizing the value of highlighting these successes, the Smart Electric Power Alliance (SEPA) released its inaugural Utility Transformation Challenge, recognizing industry leaders who are creating the future carbon-free, modern grid.

To learn more about the Utility Transformation Challenge, podcast host Jason Price and producer Matt Chester are joined by SEPA’s Chief Strategy and Innovation Officer, Sharon Allan, as well as a leader whose organization made an appearance on SEPA’s leaderboard of utilities in Debra Smith, CEO and General Manager of Seattle City Light. This duo provides a dynamic one-two punch on assessing the landscape of the utility industry today and where it’s going in the future. The conversation was so dynamic, this episode ended up being an exciting two-parter—if you didn’t listen to Part 1 where our guests focused on the Utility Transformation Challenge and the march towards decarbonization, we recommend you start there. Then come back here and listen to Part 2 where this pair of industry leaders dives into forward-looking assessments of equity in the energy industry, as well as the pending workforce transformation facing utilities everywhere.

Prefer to Read vs. Listening? Scroll Down to Read Transcript.

Thanks to the sponsors of this episode of the Energy Central Power Perspectives Podcast: West MonroeEsriAnterix, and ScottMadden

 

Key Links:

Part 1 of this Episode: https://energycentral.com/o/energy-central/episode-43-setting-example-utilities-everywhere-sepa%E2%80%99s-utility-transformation

Sharon Allan’s Energy Central Profile: https://energycentral.com/member/profile/sharon-allan-2/about

Grid Mod in the Age of Utility Carbon Reduction: https://energycentral.com/c/gr/grid-mod-age-utility-carbon-reduction

Seattle City Light's Clean Energy Leadership Garnering Industry Recognition, with Emeka Anyanwu, Energy and Innovation & Resources Officer- [an Energy Central Power Perspectives™ Interview]: https://energycentral.com/o/energy-central/seattle-city-lights-clean-energy-leadership-garnering-industry-recognition-emeka

Did you know? The Energy Central Power Perspectives Podcast has been identified as one of the industry's 'Top 25 Energy Podcasts': https://blog.feedspot.com/energy_podcasts/

 

TRANSCRIPT

Matt Chester: 

Hello, and welcome to the Energy Central Power Perspectives Podcast. We recently hosted Debra Smith, CEO and GM of Seattle City Light, and Sharon Allen, the Chief Strategy and Innovation Officer at SEPA, the Smart Electric Power Alliance, to discuss SEPA's utility transformation challenge and Seattle City Light's placement on the leaderboard of that challenge. The conversation was rigorous and incredibly informative. And so even though it ran longer than we planned, we didn't want the energy central community to miss out. So rather than cutting it down, we turned this conversation in into a two part podcast episode. If you haven't listened to part one yet, I recommend you go there first and hear these great guests discuss the background of the utility transformation challenge and the efforts Seattle City Light has taken towards decarbonization. In part two, we'll pick up the conversation right as Debra and Sharon are to dive into the equity question. I'll turn it back over to pot podcast host, Jason Price, first to give a moment of recognition and thanks to the sponsors of this podcast, and then dive back into the conversation.

Jason Price:
Before we introduce our two exciting guests. We want to first acknowledge the energy essential partners who are making today's episode possible. To West Monroe. West Monroe works with the nation's largest electric gas and water utilities in their telecommunication, grid modernization and digital and workforce transformations. West Monroe brings a multidisciplinary team that blends utility operations and technology expertise to address modernizing aging infrastructure, advisory on transportation, electrification, ADMS deployments, data and analytics, and cyber security. To ESRI, ESRI is an international supplier of geographic information, GIS software, web GIS, and geo-database management applications. To Guidehouse, formerly Navigant Research, a premier market research and advisory firm covering the global energy transformation. To Anterix, Anterix is focused on deliver transformative broadband that enables the modernization of critical infrastructure for the energy, transportation, logistics and other sectors of our economy. And to ScottMadden, ScottMadden is a management consulting firm serving clients across the energy utility ecosystem. Areas of focus include transmission and distribution, the grid edge, generation, energy markets, rates and regulations, corporate sustainability and corporate services. The firm helps clients develop and implement strategies, improve critical operations, organize departments and entire companies and implement a myriad of initiatives.

Jason Price:
And now onto today's guests. As utilities look to evolve and prepare for the future, ensuring that the lower income households and traditionally disadvantaged communities reap the fair share of benefits is critical, but in implementation it's not always straightforward. So what should the utility industry be doing to overcome that? Sharon, we'll start with you.

Sharon Allan:
So I think one of the first things that has been really helpful is just opening the conversation. We have a dialogue going on across the nation about what is equity? How do we ensure... Is it based upon income? Is it based upon race? Is it based upon living in a area that has greater carbon emissions than another? And so I think opening that dialogue has been a positive thing for the industry. But integrating equity, considerations and goals, I mean, as long as I can think going back, we've had, since the late seventies when energy efficiency and demand side management programs first came out, we've had programs for the disadvantaged, but I don't know that every time we structure a new program across our utility offerings, people have thought about how do I make sure that I'm bringing all kind customers, not disadvantaging, a certain class of customers.

Sharon Allan:
And I think that conversation's been raised to the top. And so I think step one is just people opening up that conversation and thinking about integrating those considerations into their goals, no matter what the program design is. So what are some examples of things that we see people starting to have the conversation of equity in? We've seen equitable utility EV programs looking at how they minimize barriers to adoption for all customers. Looking at community solar access and how that can, perhaps, address some equity issues that have existed. Looking at economic development and support for disadvantaged communities, and how to ensure that in some of these disadvantaged communities that they have just as good of resiliency and reliability of service, where they live as anybody else in the service territory. And I think all of us really are looking at our own workforces, and our own leadership, and beginning to challenge ourselves and ask ourselves, do we all look alike?

Sharon Allan:
And are we looking for, and actively seeking, greater diversity to change things up? So while I believe it is an area we have had programs in, in the past, it's probably been more of the smaller portion and now it's moved more central stage. And I think there's more recognition and the dialogue has opened up. And I think that's the first good step for any of us in the industry to make sure, as we do programs, that we're thinking about how we're looking at diversity and equity inclusion for anything that we design going forward.

Jason Price:
What do you think, Debra? Is Seattle City Light seeing the same things that Sharon's talking about across the industry?

Debra Smith:
Yeah, it's such an important question right now. So equity, race, social justice, they've long been core values for both the City of Seattle and Seattle City Light. And as we invest in transportation, electrification and grid modernization, we really want to invest primarily and initially to the benefit of historically underserved and impacted communities. So this means environmental justice communities such as for us, the Duwamish Valley, which is land that belonged to the indigenous people of Washington State and our BIPA customers. We think about it in terms of people who have traditionally come last, or whose voices are typically not in the room. There is no playbook for making equitable investments for us to pick up and work from. So my employees...

Debra Smith:
And thank you, Sharon, for calling out Emeka. My employees, Emeka and his team, David and others, they are literally writing that playbook. I mean, this morning, just this morning, there was some email that was running around and somebody shared out a picture of some EV charging infrastructure. And it was a picture of a fast charger that was in some neighborhood. It wasn't our picture and it wasn't from around here, but essentially there were cobwebs on it. And it was being used as a picture to demonstrate how, if you don't talk to community, if you're not engaged and not just talking at them, but actually engaging them and involving community in your work from the very beginning, from sighting and talking about how can we support perhaps a different mode of transportation in this particular neighborhood with these particular people?

Debra Smith:
If we aren't engaging those discussions in a genuine and authentic way, we can make mistakes. And one of our first public charging fast stations went into a neighborhood that has been underserved and it wasn't as well received as we had hoped, because we didn't do the hard work up front in a way that was meaningful to those folks. So we have, have learned and changed and grown. And you were mentioning our transportation electrification. Well, even as our community outreach going into Washington State's CETA process right now, which is the clean energy transformation act. We are continually learning about how to have the right conversations with folks, so we are the need where it is.

Debra Smith:
And I just want to share, really quickly, four principles that literally I'm in a call later, my last call of the day, which is around, how do we think about building electrification in the future? And my team sent me over a PowerPoint and they list four drivers. And I think it qualifies or applies not just to building electrification, but to this subject of transformation in general. And how it interfaces with and intersects with our desire to be more equitable.

Debra Smith:
So one is we desire to equitably support our customers through the decarbonization transition, which means we don't want to leave customers behind that can't afford to convert. That's going to be a very real issue for us, as a country, and worldwide, because it's not just the investments that the utility makes, or that the public sector makes. In order for this transformation to continue, it requires investment on the part of customers, many of whom can't afford it. Number two, ensure customer energy affordability. And I know that we're all thinking more holistically. It's not just about rate, it's that sweet spot between rates, energy efficiency, helping people be wise consumers of the products and services that they need now more than ever in order to navigate life. We want to reduce the burden of electrifying and help customers save on their energy bills, not their rates.

Debra Smith:
Number three, optimize the utility value while enhancing resiliency and reliability, and Sharon talked about that. We want to maximize the grid value of beneficial electrification as a way of may maintaining affordable rates. And we want to meet our financial incentives to decarbonize. We want to be a provider of that, which in Washington State, we have some work to do. And I'm hopeful that the legislation will take some of that on this year. We've made a ton of progress, but progress is, again, it's a continuing evolution. And lastly, of course, the goal is to reduce greenhouse gas and other pollutants to address community wants and needs. So this is that part about actually going out and saying what's important to you community? Is it around vehicle electrification? Is it around electrification of mass transit? Is it around creating a space where affordable housing is the most efficient and cost effective infrastructure out there? We need to be in those very individualized conversations in order to continue this movement and do it in an equitable way.

Jason Price:
Debra, let's stay with you, and let's move the conversation from customers to employees. There's a lot of transformation taking place in the utility workforce. So share with us, how is Seattle City Light preparing for the generational shift that's impending in the industry?

Debra Smith:
It's a really interesting question. And I've had a number of conversations with Julia Hamm and with Sharon and others. And whenever we talk about SEPA and this transformation that we're all part of, the cultural transformation, is really significant. And I really appreciated Sharon giving us credit for the work that we've already done, and for the readiness that that Seattle's employees have. But it's not true across the board. I mean, we have lots of pockets where it's just hard. I think Jason, you started out and talked about how our industry has been known to be somewhat stagnant, or slow to change. And that's certainly true of many of our employees, as well. And I sometimes describe... And that's not a bad thing, so let me come back to that.

Debra Smith:
I sometimes describe us as an organization that has one foot in the present and one foot in the future. And we have a lot of people here who are doing very traditional, very critical work to maintain. In fact, probably 80% of our employees are engaged in keeping the lights on, and ensuring that when you've flip the switch, the magic works, and you're warm, you're comfortable, and you've got the lighting and the support you need in your home. And then we have a group of employees who are out there actively working to create the future. They're looking at different kinds of solutions. So even as we have a large number of our people out there working directly with poles and wires and the traditional infrastructure of the industry, we also have a group of people who are working hard to think of a alternatives to those very poles and wires, especially on the larger scale or the generation side. And there is a natural tension there.

Debra Smith:
And part of my goal, part of the struggle, but also the very, very real opportunity, and it's an honor to do so, is to support both groups. Because we're always going to need both groups. I think what's true is that, over time, I believe that we will become less reliant, at least from a revenue perspective, the traditional business model. And we will expand the ways that we provide support so that... I like to think right now, I think, what do I do for a living? Well, I could say, "Hey, I run an electric utility." Or I could say, "Well, I keep people warm, dry, and I keep the lights on." But I think going forward, I want to be able to say, "I help people make smart choices that allow them to live their values." Those are very different value propositions and it takes a broad range of employees.

Debra Smith:
So it is generational. There is a generational aspect, but it's also about what line of work did you go into? How focused are you on standards? One of the things that doesn't get talked about a lot here, but as we move towards electrification, it's challenging many of our standards. And so we have groups of employees who are having to think through really hard things, because for 20,30 years, they have been told that this is the way to do it. And now we're exploring different ways to do it, or we're exploring what if we're on the other side of the meter? Ultimately, what if we view a yard of school buses as a generation resource, rather than just a hydro plant? These are huge changes.

Debra Smith:
So what we do is we're trying to work hard within a matrixed management role. It's hard. Right now, our folks in innovation and electrification are working extremely closely with both our traditional engineering shops, because what we want is we want people to learn from each other. We don't want to leave employees behind anymore than we want to leave customers behind. So we want there to be an opportunity for folks to crosswalk and expand their knowledge and the tools in their chest. And then we've got the same thing happening with energy efficiency. Energy and innovation or electrification and innovation shop. They develop these new products and services that are in response to what our customers want, and then they pass them over. And then we have another shop that does a lot of the implementation.

Debra Smith:
So again, a primary tool for City Light, and it doesn't work for everyone, and it's hard, is to matrix our management. Not create a new silo for this new work, but really look for how we can embed it in the work that all of our groups are doing. And the new normal that I want to create is a place where the folks who are keeping the lights on and the folks that are creating the future are interchangeable. And they both have an opportunity to do both pieces of work.

Jason Price:
Sharon, over to you. Is culture or cultural change something SEPA is tracking?

Sharon Allan:
As I listened to Debra speak, I wanted to start saying hallelujah. Yeah. A couple of points that I just want to reiterate, because I thought they were very profound, is as she was speaking, she said, "We need both groups." Sometimes when people talk about cultural and generation change, people insinuate younger or early career people are more technology and free thinking, and the people who are more seasoned, been around, are old school and can't change. And that bifurcated thinking is absolutely destructive. And so when you look at the overall cultural change, you've got to have new ideation working with people who have been performing traditional and critical function, because there is a fair amount of knowledge that is institutionalized in the brains of some of our employees within utilities. And as we begin to invest and automate in things, we've got to make sure that we've gotten the institutional knowledge that exists within the brains of our employees considered, so that we continue with change to keep our grid reliable and safe and economic.

Sharon Allan:
And the reality check is culture is a hard thing to quantify. You definitely quickly see when it is not working, because it's very destructive in terms of strategy, execution, or environment for employees to want to work in. But we need to be able to blend new ideation, and I think one of the things that we've been talking about is the focus on climate change and the impacts of climate change has really become a focus area to bring all teams together on what do we need to you to take our utility through this transition and bring our employees with us so that we provide safe, reliable, economic, and clean energy to our community, such that all our customers within a service territory have a variety of options of how they interact with us, how they use what they use from us, and they do it as efficient and in a smart way? It takes all types of individuals and people to be able to do that.

Sharon Allan:
And technology, while it is our friend, it is not the end all be all without the process and the knowledge. And learning how to marry the two together becomes important. While we may think of how do we do things different, as you begin to automate things, then some of your field workers and the way they may have performed a function may change, so that results in process changes and reeducating our employee base. So this cultural change is something that affects all employees, and all employees need to be working together towards the same end goal. And I think that is a key to success.

Sharon Allan:
Where I've seen some challenges for utilities in the US is they may set up a separate innovation or strategic ideation lab, and that's where, we'll label them, all the innovators are. And the challenge is if they are not working with the operational people, and the people in the utility who have to transition, then I have seen that has been a challenge in a couple of the innovation labs. And a couple of utilities have gone through some painful transition and have had to change things up, because you can't have it sitting on the sideline. It's got to be matrixed through, because it affects people in operations and how they're going to do their job, or it changes processes. It requires re-skilling, so that everyone's ready and has an appetite, so that readiness for change is there at the appropriate time.

Jason Price:
You two make a great team. I'm sure we're going to get a lot of likes on Energy Central for this discussion, so thank you again for all this input. Given our active community, one thing we've heard is that they want to know more about our guests, on a personal level. So we're going to go into our lightning round. I'm going to ask you a few questions, and you're going to answer it with one single phrase or a one word answer. Let's have Debra answer first and then, Sharon, we'll follow up with you. Are you ready?

Debra Smith:
Ready.

Sharon Allan:
Ready.

Jason Price:
Here we go. So Debra, beach or pool?

Debra Smith:
Always pool.

Jason Price:
Sharon?

Sharon Allan:
Beach.

Jason Price:
Debra, favorite late night meal?

Debra Smith:
Eggs with spinach and Parmesan cheese. Scrambled eggs with lots of spinach and Parmesan cheese.

Jason Price:
Sharon?

Sharon Allan:
Chips and guacamole.

Jason Price:
Debra, last book or article that got you to think?

Debra Smith:
Wow. That's a good one. Well, I just read an article this morning about a woman who wrote some books, and she died very young, and she's actually a Christian author, but it was in the newspaper. It had a quote that she lived by, which was "Thick skin, tender heart." It really spoke to me, because it's a lot of how I try and lead. And it was interesting that this very young 37 year old woman, in a completely different line of work, who passed away much, much, much too young would have a theme that resonates with me so closely.

Jason Price:
Interesting. Sharon?

Sharon Allan:
Yeah. So I read this book many, many years ago and just recently I read it again. It's a book by John Maxwell and it's called Failing Forward. And I don't know why I picked it up, but I thought there's enough change going on. What the book is about is really iterating and it's okay if you stumble. It's what you do after that to move forward. And when you're in the midst of a lot of change or transition, sometimes we have to think that we have to have total perfection and get everything right. And we don't always need to, we just need to be able to pick ourself up and continue the journey.

Jason Price:
Debra, what did you want to be when you were growing up?

Debra Smith:
President of the United States.

Jason Price:
Sharon?

Sharon Allan:
Wow. I guess I was less ambitious. From the time I was five, I'd always tell everybody in my family I'm going to be an engineer. And so I became an engineer and have never regretted it. I have enjoyed what I sought out to be.

Jason Price:
And Debra, what are you most optimistic about?

Debra Smith:
I'm optimistic about all the things that we get to choose to both, take forward from the pandemic and also the things that we get to choose to leave behind. And I think the conversation that we've had here today, Sharon, I honestly believe that our ability to execute on the transformation that we all know is necessary and that we're all excited about. I actually think our ability to execute has been strengthened by what we've been through these last two years. And that we will look back on this as a time that was really truly transformative for us, not just, we got through COVID, but we got to be more at choice. I think that people tend to... We do an awful lot by rote, I'm just as guilty as anybody else, and creating a space where you have to evaluate what really works, and what you want to pick back up and move forward, is incredibly healthy and will be incredibly valuable, as we engage as a community, and as a country around the importance of responding to the need for climate change.

Jason Price:
Sharon?

Sharon Allan:
I'm optimistic about the transition that we're in. And I think being at home for, who would've thought, two years, I think it's given everyone time to reflect on what's important rather than fighting with each other how we need to cooperate and collaborate more as a city, as a community, as a state, as a region, as a nation. And I think those conversations of how we, together, make sure that we are better in the US, and what we're doing to attack climate change. Never in my, I'm going on 35 plus years, never have I seen those conversations as genuine, as raw, and as personal as I hear today. And I think when people can be real with each other, when you can be real with your customers, your employees, your stakeholders, and you can have those conversations on the changes that one needs to make, I think it gives you a first good step. And it makes me optimistic because I don't think we were always so willing to have such open conversations in the past.

Jason Price:
I'm always impressed at how transparent our guests are when we ask these fun questions. So thank you both for sharing that. And I also want to thank you all for taking the time. So before we let you go, though, we'll give you both the last word. What advice would you offer, or leave as a takeaway message, to impart to our audience who are in the utility industry? Sharon, let's start with you.

Sharon Allan:
My parting advice would be just the recognition that the world doesn't have the luxury of time on emissions reductions. We need to accelerate progress, and that is a now thing. And the second thing I would leave you is that transformation is about making investments in people process technologies and alignment with customers to build the modern foundation for carbon reductions.

Jason Price:
And Debra, over to you.

Debra Smith:
Wow, that's a big question. What I would say is this, I am a 60 year old woman and I have a few years left in my career. I think I'll probably do something else, but here's the thing, folks who are in this industry right now, especially folks who are earlier, we've been talking about transformation, and we've been talking about deregulation, and the ways that this industry is changing, since I came into it. And I actually did come into this industry in my mid thirties, but it's really happening right now. And it's happening fast, and it's one of those things where we need to hold on and we need to trust that, because of what Sharon just said, because the time is now. We need to trust that the path forward is going to look different. It may feel scary at times. It's certainly going to feel uncomfortable and it's absolutely necessary, and we all have it in us.

Debra Smith:
So it is really, really here. And we need smart ideas and people looking to working together. And again, we need a spirit of collaboration, cooperation, and a partnership. And I think if we can figure out how to do that, I'd love to see Congress figure out how to do that, but if we can figure out how to do that, I think we can move the needle in a mighty way.
 

Jason Price:
It's been a thrill having you both join us today. And I mean it, you make a great team, both of you. Thank you again for taking your time out of your busy schedule to share your insights with our Energy Central audience. Hopefully, as this all continues to develop, you can share with the Energy Central audience again, and keep us up to date. Until then, Debra and Sharon, thank you so much for joining us today.

Debra Smith:
Thank you for having me.

Sharon Allan:
Thanks for having me, Jason.

Jason Price:
Once again, I'm your host Jason Price. Plug in and stay fully charged in the discussion by hopping into the community at EnergyCentral.com. See you next time at the Energy Central Power Perspectives Podcast.

 


About Energy Central Podcasts

The ‘Energy Central Power Perspectives™ Podcast’ features conversations with thought leaders in the utility sector. At least twice monthly, we connect with an Energy Central Power Industry Network community member to discuss compelling topics that impact professionals who work in the power industry. Some podcasts may be a continuation of thought-provoking posts or discussions started in the community or with an industry leader that is interested in sharing their expertise and doing a deeper dive into hot topics or issues relevant to the industry.

The ‘Energy Central Power Perspectives™ Podcast’ is the premiere podcast series from Energy Central, a Power Industry Network of Communities built specifically for professionals in the electric power industry and a place where professionals can share, learn, and connect in a collaborative environment. Supported by leading industry organizations, our mission is to help global power industry professionals work better. Since 1995, we’ve been a trusted news and information source for professionals working in the power industry, and today our managed communities are a place for lively discussions, debates, and analysis to take place. If you’re not yet a member, visit www.EnergyCentral.com to register for free and join over 200,000 of your peers working in the power industry.

The Energy Central Power Perspectives™ Podcast is hosted by Jason PriceCommunity Ambassador of Energy Central. Jason is a Business Development Executive at West Monroe, working in the East Coast Energy and Utilities Group. Jason is joined in the podcast booth by the producer of the podcast, Matt Chester, who is also the Community Manager of Energy Central and energy analyst/independent consultant in energy policy, markets, and technology.  

If you want to be a guest on a future episode of the Energy Central Power Perspectives™ Podcast, let us know! We’ll be pulling guests from our community members who submit engaging content that gets our community talking, and perhaps that next guest will be you! Likewise, if you see an article submitted by a fellow Energy Central community member that you’d like to see broken down in more detail in a conversation, feel free to send us a note to nominate them.  For more information, contact us at community@energycentral.com. Podcast interviews are free for Expert Members and professionals who work for a utility.  We have package offers available for solution providers and vendors. 

Happy listening, and stay tuned for our next episode! Like what you hear, have a suggestion for future episodes, or a question for our guest? Leave a note in the comments below.

All new episodes of the Energy Central Power Perspectives™ Podcast will be posted to the relevant Energy Central community group, but you can also subscribe to the podcast at all the major podcast outlets, including:


Thanks once again to the sponsors of this episode of the Energy Central Power Perspectives Podcast: West MonroeEsriAnterix, and ScottMadden

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