EET&D : What does the landscape look like going forward from your perspective in the area of energy services?

Rosentrater: : Technology is rapidly changing the energy landscape in ways we may not even be able to imagine today. It’s a time of tremendous change. For example, Distributed Energy Resources are continuing to impact the energy industry. Those utilities that ignore these influences run the risk of becoming irrelevant, while utilities that embrace change and explore new technologies will be in a better position to build a trusted relationship with customers in the energy future.

At Avista, innovation has been in our DNA for 127 years. Energy providers can actually cultivate an innovative culture if they’re intentional and build the capacity into their skill set. Employees must be encouraged to identify opportunities and problems and look into new technologies and how to access more data to find solutions.

It’s important to always look ahead and identify leading edge technologies. At Avista, that includes installing the largest operating vanadium flow battery in North America and Europe with an Energy Storage Project. It’s allowing us to address one of the biggest challenges facing our industry as we learn how to integrate intermittent renewable energy into the electrical grid.

EET&D : How does a culture of innovation help position providers for the utility of the future?

Rosentrater: : This is an exciting time in the energy industry. Technology is transforming the way energy is generated, transmitted and consumed. Rapid disruptions in technology are creating viable pathways to integrate more renewable energy, creating more choice to consumers and dramatically changing how electricity is delivered.

Through a culture of innovation, energy providers can actually help shape how the utility of the future will deliver value and services to the next-generation customers. This can be accomplished by focusing on 3 areas:

• Bringing value to customers: We must have the ability to offer different services based on customer preferences. Some customers simply want to pay their bill. Others want to actually participate in the grid. Providers need to meet the customer where they are.
• Improving grid operations through technology pilots: Another area of focus is the more technical side of grid operations. For example, when Avista received three grants from the U.S. Department of Energy’s American Recovery and Reinvestment Act (ARRA) we built a foundation for the future by installing sensors, switches and software to automate many parts of the distribution system. We have applied what we learned to future upgrades to our distribution system. As a result, customers have experienced fewer and shorter outages and we’ve seen energy efficiencies on our system.
• Workforce development: Fostering a culture of innovation inspires employees to think differently and continually learn.

EET&D : Why should an energy provider explore battery storage?

Rosentrater: : The industry and consumers see tremendous promise in energy storage as we move forward on the renewables front. The challenge is how to integrate intermittent renewable energy into the electrical grid.

For example, Avista’s Energy Storage Project is a 1MW, 3.2MWh battery storage system that went online in April 2015 and has now been in operation for more than one year. The three-year battery storage project carries a $7Million price tag, which is supported in part by a $3.2Million Clean Energy Fund grant and $3.8Million in Avista matching funds.

The pilot project is allowing Avista to invest in our Energy Storage Project to explore numerous value streams and to test for a number of use cases with the goal of increasing efficiency and building a more reliable system. Ultimately, what we learn about battery storage will help our electrical grid become more flexible, reliable and resilient.

EET&D : Given all the forces that are disrupting the energy industry, how do utilities remain relevant in the future?

Rosentrater: : In order to remain relevant in the new energy future, it would be prudent for utilities to explore different business models.

At Avista, we’re focusing on new business models – like ‘Economies of Scope.’

We believe battery storage is a real game changer and the utility is uniquely positioned to leverage the stacked value of battery storage assets for multiple purposes – such as reliability and maintaining power quality.

As we look toward the future, we are building upon the utility industry’s current business model focused on economies of scale – where growth occurred by adding customers – and leveraging a new business model focused on ‘Economies of Scope,’ which allows us to maximize assets for multiple uses, creating new revenue streams.

Through ‘Economies of Scope’ the utility can leverage energy storage every minute of every day.

EET&D : How do you continue to cultivate Avista’s culture of innovation for the next generation of employees?

Rosentrater: : We’ve intentionally created Grid Edge and Innovation Workgroup Teams that are constantly thinking ahead about how to meet the changing expectations and future needs of our customers.

We are also applying design thinking and a ‘how might we’ approach to emerging issues – like solar.

Unlike other parts of the country, we don’t have high rooftop solar adoption or penetration. But we know that solar is viable and some of our customers want that technology. So we developed choices.

We have an online web tool that allows customers to determine if it’s cost effective to install solar panels on their home. Avista has recently built the largest community solar installation in Washington state. Customers can participate by purchasing panels without getting pre-qualified or dealing with construction or maintenance.

It’s a win-win situation. Customers can easily participate in solar and Avista can learn about integrating solar into our electrical grid.

EET&D : What else can utilities do to prepare for the energy future?

Rosentrater: : We know that new technologies will continue to change the energy landscape. And many utilities are embracing this change.

We don’t know what will happen in the future, so we are focused on piloting technology, partnering with others, and pushing to understand so we can continue to learn and innovate.

We’re well positioned to take action when opportunities arise.

This approach also allows Avista to actually lead during times of change.

EET&D : We can’t thank you enough for taking the time to walk us through the future of energy storage. It’s a complex and at the same time exciting time in the world of transmission and distribution with a lot of new technologies at play.