Writer responds to PSE story
October 3, 2008 · Updated 1:41 AM
The front page story about Puget Sound Energy's proposed
staffing shifts should be viewed as another indication that big changes in the
utility industry are coming down the road. PSE's current staffing convolutions
are primarily being caused by changes in the way electricity is generated,
transmitted and distributed to end users.
Basically, the generation, transmission and distribution of
electricity are being "unbundled" as part of
the nationwide effort to deregulate the utility industry. This means one
company will generate power, another (Bonneville Power Administration
in our case) will transmit the bulk power from the generating sites to the
distribution utility's local grid, and the local utility will deliver power on
demand to the points of use. Puget Sound Energy is evolving into one of the
local "distribution" utilities because
they have already divested much of their generating resources and BPA is
the recognized transmission agency in the Pacific Northwest.
Is this bad? No, not really. But, it does mean that PSE soon must
make all their profits off only part of their historical piece of the pie. Now
they have no guaranteed rate of return on generation, transmission and
distribution combined. While it is true they still have their legal monopoly on
distribution rights in their service territory, even this is not guaranteed
because big chunks of their distribution business can go elsewhere. This is
evidenced by up to six municipalities currently thinking about jumping
the PSE ship and forming their own public utilities. In other words, PSE
must become competitive in ways they didn't dream of even five or ten
years ago. This means controlling the costs of operating and maintaining the
local grid _ a tough job in an area that is growing as fast as the tri-county
area of the central Puget Sound Basin.
The employees of PSE should stay light on their feet because all
these changes will inevitably affect them _ sometimes adversely. I think they
are about to join the ranks of displaced loggers, fishermen and middle
bank managers. Users of electricity (this means everyone) should stay light
on their feet because the key question in all of this is "reliability." Will it
get better, or suffer? Will the cost of "reliable" electricity increase, stay
the same or go down?
The utility industry is currently spending millions on development
of fuel cells and microturbines that generate power at the point of use.
These technologies don't require an electricity grid. In the near future
individual residences and businesses may be able to choose to generate their own
power on site instead of buying off the grid. The days when good ol' Puget
Power took care of everyone by building an affordable "electricity birthright"
are beginning to erode and even the senior managers upstairs in Bellevue
are operating with a somewhat cloudy crystal ball.
William L. Petitjean