Con Edison CEO discusses investments in renewables, transmission infrastructure
Consolidated Edison (Con Ed) Chairman and CEO John McAvoy discussed the New York-based utility’s investments in infrastructure, transition to renewable energy, and its planned rate hike at the Edison Electric Institute’s (EEI) Financial Conference in Orlando, Fla., on Tuesday.
Con Edison delivers electric, gas and steam to 3.5 million customers in New York City and Westchester County, N.Y., and has three primary lines of business: utilities including Con Edison Co. of New York (CECONY) and Orange and Rockland Utilities (O&R); Con Ed Transmission, which includes electric and gas transmission projects; and its clean energy business. The utility business is the biggest part of Con Ed’s portfolio, but the company sees good growth opportunities in transmission and clean energy.
The company has plans to invest in all three areas over the next three years, including $10.3 billion in its utility businesses, $1 billion in clean energy, and $200 million in the transmission business.
Con Ed uses data analytics and algorithms to analyze needs and focus investments on areas that yield optimal benefits, McAvoy said. Among the investments, Con Ed is planning to replace 90 miles of gas main pipelines per year. It is also investing in natural gas detectors that are linked to smart meters that alert company officials directly if a natural gas leak occurred.
Further, the company will also continue its plan to invest in installing smart meters for customers. The company has already deployed 2.3 million smart meters and has plans to install another 3 million. “Smart meters are really the cornerstone of our efforts to meet the evolving needs of customers by providing greater insight to energy use with near real-time data,” McAvoy said. “It is truly a transformational technology.”
The utility is also spending about $700 million in products and initiatives that foster energy efficiency for customers.
“Over the last 10 years our investment in gas and electric energy efficiency and demand management programs have helped over 800,000 CECONY customers avert 6 million metric tons of carbon dioxide emissions,” McAvoy said.
These investments, which are driven by Con Ed’s priorities of safety, operational excellence, and customer service, will be reflected in the company’s proposed rate plan. The proposal calls for about a 6 percent rate hike over the next three years for customers, McAvoy said. The rate plan is subject to final approval by the New York State Public Service Commission and would go into effect in early 2020.
“The multi-year settlement will support our efforts to continue to provide best in class reliability for our customers to improve safety and to continue to enhance the customer experience,” McAvoy said. “The settlement reflects refunds to customers associated with tax reform and continues the major features of our current rate plans.”
McAvoy also addressed the company’s commitment to clean energy and combatting climate change. First, to help the state meet its energy efficiency goals, Con Ed is investing in curbside charging stations and fast-charging stations for electric vehicles. Also, it is working with Columbia University on a climate change vulnerability study with the goal of developing an implementation plan based on the findings of the study. The company has invested $6 billion in clean energy to date and will invest another $1 billion in the business over the next 3 years. Con Ed is the second-largest solar producer in North America with 2,600 megawatts of renewable assets in 17 states.
In its transmission business, Con Ed is moving away from gas and oil pipelines. McAvoy said the growth opportunities for natural gas are less than they were five or six years ago. Thus, the company capped its investment in the Mountain Valley gas pipeline at $530 million. “We don’t really expect a lot of significant, and maybe not any additional investment, in gas transmission in the future,” McAvoy said. “We see good opportunities on the electric transmission side, not so much on the gas transmission side.”
Con Ed also is looking to expand its portfolio of electric transmission projects. Con Ed Transmission has a 46 percent stake in the New York Transco, which is committed to developing electric transmission projects in the state. Also, Con Ed was selected by the New York Independent System Operator to develop a new transmission line called the New York Energy Solution Project – a 54-mile electric transmission line in the Hudson Valley that will bring clean energy from upstate New York. The transmission line is expected to be operational in 2023. McAvoy believes there will be other electric transmission opportunities as more wind and solar projects come online requiring transmission to load centers.
“Guided by our core principles and our focus on sustainability Con Ed is poised for a strong future as we progress towards a cleaner economy,” McAvoy said. “I am very optimistic about the company’s future with an outlook that is exciting and sustainable.”
