Exelon: Transportation presents major opportunity from beneficial electrification perspective
WASHINGTON — Electric utilities must help accelerate the adoption and success of electric vehicles (EVs) through beneficial electrification programs that support the environment, the economy and the grid, said Christopher Budzynski, director of utility strategy for Exelon Utilities.
And that’s exactly how Exelon — the Chicago-based American Fortune 100 energy company that in 2018 generated revenues of almost $36 billion — is pursuing electrification, said Budzynski during a Feb. 10 session at the National Association of Regulatory Utility Commissioners (NARUC) 2020 Winter Policy Summit held here.
“The transportation sector represents a unique and significant opportunity from a beneficial electrification perspective,” said Budzynski, a panelist who presented “Beneficial Electrification: What If We Build It and They Don’t Come,” during the NARUC session. “It’s here and it’s around the corner.”
It will save consumers money over the long term, reduce negative environmental impacts, and improve grid management, he explained.
“There is a strong general agreement, or at least a premise … that the utility still plays a strong and central role in the electrification conversation,” said Jeff Ackermann, chairman of the Colorado Public Utilities Commission and the panel moderator. “It still starts with the utility as the operator of the distribution grid.”
Utilities, Ackermann said, have “unparalleled access to capital and delivery incentives,” making them uniquely positioned to execute beneficial electrification programs.
Budzynski explained why electrification is important to Exelon and its utilities; what the company considers beneficial electrification to be as it applies to EVs or electrification of the transportation sector; and what Exelon has done from a program design perspective in its transportation electrification programs to minimize risks to customers and maximize their benefits.
“Electrification really has the ability to transform our industry in many ways and presents one of the most significant growth opportunities for our industry,” said Budzynski, noting that the company sees many related benefits to electrification for Exelon, for society and for customers.
For instance, from Exelon’s perspective as a utility and vertically integrated organization, he said the company sees the impacts and the benefits that EVs will bring to the grid.
“These are new resources; they are a controllable load on the system — they’re actually distributed energy resources on the grid … and those really work to complement the existing generation that we have on our system,” Budzynski said.
From a strategic alliance perspective, electrification benefits Exelon by allowing it to engage with its customers and provide them with energy solutions around electrification, said Budzynski, adding that this also aligns with Exelon’s Connected Communities vision in which transportation is a key component.
“When we look at this from a growth opportunities perspective,” he said, “it’s going to be incremental load on the system and it’s also going to be a way for Exelon to offer new products and solutions to customers.”
From the societal perspective, Budzynski said there’s an environmental benefit to electrifying the transportation sector, such as by reducing greenhouse gases (GHGs).
In fact, without the transportation sector, states aren’t going to achieve related policy objectives, he said, pointing out that transportation represents a total third of total GHGs emissions.
Exelon from a public health perspective thinks that transportation electrification will reduce particulate matter and support public health and safety, Budzynski said.
For example, he said there are studies that show that electrifying a bus in New York City creates $150,000 per year in public health benefits. “That’s pretty significant with just one bus,” he said.
And when Exelon considers this from an equity perspective, he said it’s really designed to improve air quality, as well as quality of life for its customers, who in turn want to see economic efficiencies.
Transitioning to an EV or electrified transportation really can result in overall potential energy usage reductions for end users, said Budzynski, adding that it provides increased fuel stability and transparency for customers.
Good, higher-paying, technology-related jobs also will be produced by this transition to transportation electrification, which stands to create a vibrant new workforce, he said.
Among the programs that Exelon has done within its six utilities include some state-approved legislation, several approved state filings, and several that are still pending approval by state commissions “that will help Exelon move forward on the transportation electrification front,” said Budzynski.
“Utilities are uniquely positioned to execute electrification programs,” agreed panelist Bill LeBlanc, chief instigation agent at eSource. “Energy utilities are unique stakeholders” due to their customer relationships, access to capital and infrastructure development expertise.
In defining beneficial electrification, LeBlanc said it is environmentally beneficial, economically efficient and grid efficient, with the “sweet spot” that overlaps the three definition components being where carbon, rates and bills would all be reduced.
To help reach that goal, LeBlanc said that electrification programs, particularly those run by utilities, should receive regulatory incentives.
Buzynski agreed, saying regulators should take societal benefits of transportation electrification into consideration, encourage collaboration among all stakeholders, and really listen to any advice that a utility puts forth.
