Q&A: Portland General Electric’s Pope targets net-zero path for IOUs
One of the major considerations that is currently top of mind for Maria Pope, CEO and president of Portland General Electric (PGE), is climate change and the importance of investor-owned utilities like PGE meeting their climate goals.
“The recent Sixth Assessment Report from the U.N. Intergovernmental Panel on Climate Change [released in March] confirmed what we already knew: we face a serious and immediate global threat,” Pope told Daily Energy Insider in a recent interview. “The directive from customers is clear — we must work urgently. And, as we transform our system, we must also maintain reliability and affordability.”
And she’s got a forward-looking plan on how to get there.
“At the core, it is about building resilience to recover faster,” said Pope. “Foundational to our ability to adapt and improve is innovation, new technologies, and partnership as extreme weather events do not differentiate where and when they show up.”
That’s the plan she’s overseeing at PGE, an integrated energy company that generates, transmits, and distributes electricity to roughly half of Oregon’s population and has the largest voluntary renewable energy program in the country.
Pope, who in June was elected vice chair of the Edison Electric Institute (EEI), which represents all of America’s investor-owned utilities (IOUs), outlined how her company and other IOUs are on track to successfully help mitigate climate change while also facing a plethora of other challenges. Such work is something she’s supported for many years.
“Maria Pope is a champion for innovation in the energy sector where she is balancing investments in renewable energy, improving grid resilience, and ensuring customer prices remain affordable,” said EEI President Tom Kuhn. “She also provides exceptional leadership collaborating with our federal agencies on resiliency and wildfire mitigation. We are extremely fortunate for her continued service on the EEI leadership team.”
Pope joined PGE in 2009 as chief financial officer. She went on to serve as senior vice president of Power Supply, Operations, and Resource Strategy.
Additionally, Pope represents the electric power industry on the U.S. Department of Energy’s Secretary of Energy Advisory Board. She also serves as co-chair of EEI’s Wildfire CEO Taskforce and the Wildfire Working Group of the CEO-led Electricity Subsector Coordinating Council (ESCC), which serves as the principal liaison between the federal government and the industry.
Her other board work includes chair of the Electric Power Research Institute, Columbia Banking System Inc., the Oregon Business Council, and the Portland Branch of the Federal Reserve Bank of San Francisco.
Pope is an alumna of the Stanford Graduate School of Business and earned a bachelor’s degree from Georgetown University.
The following interview has been edited for length and clarity.
What top two or three steps do IOUs need to take over the next five to 10 years to reach net-zero goals and can they do it successfully?
Pope: I think it is first important to address why meeting our climate goals is important. We reflect the priorities of the customers and communities we serve. I am proud that prioritizing clean energy is deeply valued by Portland General Electric’s customers — for the last decade we have had the number one voluntary renewable energy program in the country.
We have felt the direct impacts of climate change right here in Oregon — wildfires, ice storms and extreme heat — and we recognize our significant responsibility to address the challenges of climate change head on.
Oregon utilities, including Portland General Electric, have ambitious emission reduction targets via House Bill 2021: an 80 percent reduction of greenhouse gasses by 2030, on the way to 100 percent by 2040 — working in partnership with customers, communities, officials, and stakeholders to create a clean energy future.
Here’s how we plan to get there: First, utilities must plan annually for new clean energy investments and utilize every resource at their disposal, including utility-scale renewable energy projects; non-emitting capacity such as batteries; community-based renewable energy and customer-sited solutions.
PGE has been a leader in developing wind and solar since we built our first wind farm at Biglow Canyon in 2007. We have already made noteworthy progress toward meeting our 2030 emissions reduction target, including achieving a 25 percent reduction in emissions from power sold to Oregon retail customers compared to the 2010-2012 baseline.
Our latest Clearwater wind farm will come online this December. And, we recently announced three battery storage projects totaling 475 MW — the largest procurement of standalone energy storage by a U.S. utility outside of California.
Second, we work with partners to integrate regional energy markets. This is important for affordability and resource adequacy. The Western Energy Imbalance Market has reduced customer bills by $4 billion since 2014, with PGE’s share over $200 million.
Third, we are investing in our distribution system as we build a smart, adaptive and resilient grid — including allowing for two-way energy transfers across our service area as we partner with customers. By 2030, we expect as much as 25 percent of the power we need on the hottest and coldest days of the year to come from customers and distributed energy resources. That is a significant shift in how we operate. Similarly, upgrades to local transmission lines and new regional transmission solutions are critical.
I recently attended the annual conference of EEI, the board of which I serve on as vice chair, and left with a shared optimism for the path forward.
For PGE and utilities across the country, the transformation of our electrical system needs to represent a change in how we plan, design, build, and operate more flexible and resilient transmission and distribution systems. Smart grids that move beyond energy delivery to better integration and partnerships with customers, optimizing customer distributed energy resources and flexible loads to achieve greater resiliency and reliability at lower cost. Our customers are at the center of everything we do — as utilities we must give them tools and resources to manage their energy usage and costs, being their trusted resource for information and solutions.
What collaboration must exist between IOUs moving forward in a world where there exists increasing numbers of cybersecurity threats, natural disasters, market pressures, and other challenges?
Pope: Utilities are committed to a clean energy future, while maintaining and enhancing the secure, safe, reliable and affordable service that our customers have counted on for over 100 years. For Portland General, and utilities across the country, more than 40 percent of the electricity that powers our homes and businesses comes from clean, carbon-free sources, and carbon emissions from the U.S. power sector are now as low as they were in 1984, all while electricity use has climbed 73 percent and overall economic activity has more than doubled since then.
It’s clear that partnerships between utilities are key. Organizations such as EEI lead this collaboration and the sharing of best practices. Resource adequacy is a growing critical issue, and one we must address working together. Just this year, FERC approved the Western Resource Adequacy Program, which will allow Western utilities to better plan and share capacity, an essential next step.
Additionally, PGE is not unique in facing an increasingly unpredictable climate. Utilities can share strategies for how to tackle this immense challenge. Our customers count on us to provide safe, reliable electricity at all times and under any weather conditions.
I serve on EEI’s CEO Wildfire Working Group, which is an outgrowth of the work of the Electricity Subsector Coordinating Council. The ESCC was founded more than a decade ago, in the aftermath of Superstorm Sandy. This partnership brings together the senior leadership of government and our industry to focus on a wide range of threats to the grid. Working with the Departments of Energy and Homeland Security, as well as the leadership from EEI President Tom Kuhn and the White House has made a significant difference.
Five years ago, seeing the threat that wildfires posed to the reliability and security of the energy grid, the Wildfire Working Group was formed, which has brought in partners from the U.S. Forest Service, the Department of the Interior, the FAA and other agencies to look at this crisis with a comprehensive lens. We recently worked with Senators Dianne Feinstein and Alex Padilla to introduce a bill to expedite the removal of hazardous trees near powerlines.
Heading into the hotter months, how has PGE prepared its demand response programs to help ensure it provides reliable electricity and keeps customers safe during these months? Why is this a beneficial strategy for IOUs?
Pope: Weather readiness is a year-round endeavor for Portland General Electric. Since we started implementing flexible load programs for our customers, we’ve seen a steady year-over-year increase in customer participation and energy saved. In fact, as of 2022, over 22 percent of residential households are participating in PGE’s opt-in flexible load programs — including Time of Day, Peak Time Rebates, Smart Thermostat and Multifamily Heating programs. Together, they are essentially building flexible load capacity 1 kW at a time.
Last summer, which brought periods of prolonged extreme weather to our service area, PGE customers participating in flexible load programs saved 70.5 MW of energy during critical periods. As we move forward, we are rapidly growing our demand response capabilities with the addition of smart batteries and integrated EV charging. This work is key in reducing the load on the nation’s grid and increasing reliability.
From your CEO perspective, how tough is it to simultaneously balance creating value for shareholders and customers?
Pope: Putting customers first is at the center of all that we do. We provide the essential service of safe, reliable, affordable energy to customers. As an investor-owned company, we make business decisions rooted in service to that core mission.
An example of this is our highly competitive RFP processes. The clean energy transition will necessitate significant investment and we are pleased to be moving forward with 311 megawatts of new wind resources in Montana and 475 megawatts of new battery storage that benefit customers and shareholders alike. Additionally, we have significant transmission investment opportunities as our customers continue to grow and expand their operations, especially in the semiconductor and digital sectors.
In addition to reinvested earnings and new debt and equity capital, we are aggressively pursuing funds available through the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA). Many of these projects are in partnership with our customers, tribal partners, and communities.
We know some customers want to go further and faster to decarbonize. At the same time, we recognize that an affordable electric bill is essential for customers as they face rising costs of living. Wherever customers are on their energy journey, we are providing them with options, information, and solutions to meet their goals.
Affordability is critical and utilities are focused on several strategies. That includes putting customers in charge of their energy use through some of the programs I mentioned, as well as using technology and digital tools to lower operating costs and improve customer service.
We are also working with partners to increase customer savings through energy efficiency, building on PGE’s and the Energy Trust of Oregon’s longstanding and very successful energy efficiency programs.
We also aim to maximize opportunities from the federal government through the IRA and IIJA and help customers benefit from incentives and tax credits.
Finally, as utilities, we must ensure we are using long-standing state programs and our own programs to support low-income customers. For example, PGE has an income-qualified bill discount program which provides a 15-25 percent discount to customers in need of assistance.
What keeps you up at night?
Pope: Execution, execution, execution. We find ourselves as an industry at a pivotal moment of rapid change. Much is being asked of utilities across the country, and we are rising to the occasion. We are learning to use technology at a completely different scale and operational integration.
At PGE we recognize our significant responsibility, not only to address our own emissions, but to also facilitate economy-wide transformation. We could not be more fortunate to lead in a time of urgent transformation with the opportunity to make a difference for our planet and generations to come.
