electricity for the 21st century: digital electricity for a digital economy

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Technology in Society 26 (2004) 209–221

www.elsevier.com/locate/techsoc

Electricity for the 21st century: digitalelectricity for a digital economy

Kurt E. Yeager �

Electric Power Research Institute, 3412 Hillview Avenue, Palo Alto, CA 94304, USA

Abstract

In August 2002, the Board of Directors of the Electric Power Research Institute encour-aged the Institute to examine the serious challenges facing the electric power sector. The goalwas to define the characteristics of a vital and robust sector, and to help develop an action-able leadership framework. The ultimate goal of the ‘‘Electricity Sector Framework for theFuture’’ project is to establish a coherent set of actions and accountabilities that will enablethe electricity sector to meet the escalating needs and aspirations of its customers, investors/owners, and society. In order to be effective, such a set of actions must reflect mutual self-interest and equity across the broad electricity stakeholder community. In general, thisrequires a unified industry leadership commitment that electricity, through innovative tech-nology, has a service value greater than its traditional basic commodity value. This vision ofinnovative opportunities to transform the reliability and value of electricity for the futuremust be ‘‘sold’’ to the public and public policy leaders at the local, state, and federal levelswho can credibly advocate the message. Additionally, the initiative must be expanded toeducate stakeholders about mechanisms for strengthening industry credibility, building trust,and gaining broad public and political support for the sector’s vision and needed actions.Finally, the costs and benefits must be made tangible, compelling, and urgent for all stake-holders, especially consumers.# 2004 Elsevier Ltd. All rights reserved.

Keywords: Transformation of electric sector; Integral communication and power; Consumer portals;

Digital controls; Automated distribution; Smart power

The electricity sector stands at a critical fork in the road of progress, and its sta-

keholders must make choices about the future value of the sector. The decisions

made and the path taken will make a profound difference, not only to the

K.E. Yeager / Technology in Society 26 (2004) 209–221210

electricity sector itself but also to the nation and the world. With so many factorsconverging at one time on the electricity sector, stakeholders will need to identifythe means for moving on several fronts simultaneously.In August 2002, the EPRI Board of Directors encouraged the Institute to examine

the serious challenges facing the electric power sector. Key findings of the report,entitled Electricity Sector Framework for the Future, reflect the comprehensive resultsof the examination. The goal was to define the characteristics of a more vital, robustsector and to develop an actionable leadership framework for achieving this future.

1. Stakeholder vision

In spite of the regional differences in market development and the timing of tech-nological advances, the US electricity sector is expected to eventually reach a visionwhich the EPRI calls the ‘‘21st Century Transformation.’’ Key questions are: howlong will it take, will it be driven predominately by the current participants or oth-ers, and what can be done to enable a smooth and predictable transition ratherthan a series of disruptive and expensive, crisis-laden experiences? Equally impor-tant is ensuring that the costs of the transition, and any discomfort experienced bythe public, do not outweigh the benefits. The Transformation represents an inte-grated, sustainable solution to the rising expectations of stakeholders—a futurewhere the electricity sector becomes a platform for technical innovation and con-tinued economic prosperity.One of the linchpins for economic growth is digital control of the power delivery

network, combined with a consumer-based technology that replaces the traditionalelectric meter with a ‘‘consumer portal’’ for two-way flow of information andenergy. Eventually, it is expected that this platform will enable every end-use elec-trical appliance to be linked with the open marketplace for goods and services,including, but not limited to, electric power. Economic productivity will increasesubstantially as the electric power sector is transformed, generating additionalwealth to help cope with ongoing societal, security, and environmental challenges.There are several advantages to transforming the electricity/information infra-

structure:

. US productivity is increased.

. The value and output of goods and services are increased, thus creating thewealth needed to fund the growing societal costs of an aging population.

. Energy efficiency and electricity intensity are improved.

. Reduction of carbon emissions is accelerated.

. The overall security of the power system is improved.

2. Increasing the value of electricity

As the history of other technological enterprises has shown, markets may movealong a path that is not necessarily controlled either by regulators or the existing

211K.E. Yeager / Technology in Society 26 (2004) 209–221

companies serving those markets. In the case of the electricity sector, the ultimateforce pulling it into transformation is not so much the technology of supply as thetechnology of demand—specifically, intelligent technologies that enable ever-broader consumer involvement. As long as consumer involvement is limited to theon–off switch and time-of-day pricing, the commodity paradigm will continue todominate the business and therefore require regulation to protect a relatively weakconsumer from cost-constrained suppliers. It is important to remember that supplyand demand in the electricity industry still relies on the same basic technology usedsince electrification began a century ago. This is a remarkable record of perform-ance, but one that can no longer be sustained as technology continues to evolve.Today’s consumer-based technology empowers the electricity consumer, opening

the door to new and innovative services along with different levels and types of elec-tric power. Vigorous, price-sensitive demands from consumers is an integral part ofthe electricity marketplace. A smart, self-healing power delivery system will be theconduit for greater use of productivity-enhancing digital technology by all sectorsof the economy, leading to accelerated productivity growth rates. The power systemenables new energy/information products and services and reduces or eliminatesthe costs of power disturbances characteristic of the US economy today.The most important feature of this transformation is the focus on serving con-

sumer needs through multiple channels. It is possible to divide the products andservices provided by the power sector into three broad categories:

1. Products and services that have economic value in private markets. Private mar-kets are willing to pay for many of the services envisioned by the increased func-tionality of the transformed power supply system. If government help isrequired, it will be to overcome market imperfections that limit the incentive toinnovate.

2. Public goods for which markets can be created. The most efficient policy is to cre-ate markets through incentives. The government role will be to create the mar-ket (e.g. pollution control), and let the private sector introduce the technology.The key is that government is a reliable market creator so investors can beassured of recovering their costs.

3. Public goods for which markets cannot be created. The benefits of a transformedelectricity delivery infrastructure are many, but their common-carrier nature dis-courages market creation. Therefore, the most effective government role here isdirect investment in developing and deploying shared infrastructure to fill themarket gap.

3. Developing the 21st century power system

Advanced technologies now under development or on the drawing boards holdthe promise of meeting the comprehensive electricity needs of a robust digital econ-omy. The architecture for this new technology framework is becoming clearthrough early research on concepts and the necessary enabling platforms. In broad


strokes, the architectural framework envisions an integrated, self-healing, electro-nically controlled electricity supply system that is extremely resilient and respon-sive—one that is fully capable of responding in real time to billions of decisionsmade by consumers and their increasingly sophisticated microprocessor agents. Inshort, the potential exists to create an electricity system that provides the sameefficiency, precision and interconnectivity as the billions—ultimately trillions—ofmicroprocessors that it will power.A coalition of electricity companies, both public and private, is now spearhead-

ing the development of this transformed electricity system architecture. The Con-sortium for Electricity Infrastructure to Support a Digital Society (CEIDS) bringstogether an array of private, governmental, and international collaborators whorepresent the spectrum of electricity stakeholders needed to ultimately achieve the21st Century Transformation.The institutional and economic framework envisioned for the Transformation

ultimately depends on building new types and levels of functionality into the powersystem. These capabilities will be enabled in the broadest sense by several break-through innovations, including, but not limited, to the following:

. Digitally controlling the power delivery network by replacing today’s relativelyslow electro-mechanical switching with real-time, power electronic controls. Thiswill become the foundation of a new smart, self-healing power delivery systemthat will enable innovative productivity advances throughout the US economy toflourish. Digital control is the essential step needed to most cost-effectivelyaddress the reliability, capacity, security, and market-service vulnerabilities oftoday’s power delivery system. As a practical matter, such a transformation isthe only way these vulnerabilities can be comprehensively resolved.

. Integrating communications to create a dynamic, interactive power system, a new‘‘mega-infrastructure’’ for real-time information and power exchange. This is thecapability needed to enable retail energy markets; power interactive, micro-processor-based service networks; and fundamentally raise the value propositionfor electricity. Through advanced information technology, the system would beself-healing in the sense that it is constantly self-monitoring and self-correctingto keep high-quality, reliable power flowing. It can sense disturbances andinstantly counteract them, or reconfigure the flow of power to cordon off anydamage before it can propagate.

. Automating the distribution system to meet changing customer needs. The valueof electricity distribution system transformation—fully automated and integratedwith communication—derives from four basic functionality advantages:

1. reduced number and duration of consumer interruptions, system fault antici-pation, and faster restoration;

2. increased ability to deliver varying levels of reliable, digital-grade power;3. increased functional value for all consumers in terms of metering, billing,

energy management, demand response, and security monitoring, amongothers; and


4. access to selective consumer services including energy-smart appliances,power market participation, security monitoring, and distributed generation.

Even initially, the value of these advantages to consumers, suppliers, and societymore than justifies the needed public/private investment commitment. Moreimportantly, this transformation will enable additional innovations in electricityservice that are bounded only by our imagination, including:

. Transforming the electric meter into a consumer gateway that allows price sig-nals, decisions, communications, and network intelligence to flow back and forththrough a two-way energy/ information portal. This will be the linchpin tech-nology that leads to a fully functioning marketplace with consumers responding(through microprocessor agents) to price signals.

. Integrating distributed energy resources. The new system would also seamlesslyintegrate an array of locally installed, distributed power generation sources (suchas fuel cells and renewables) as power system assets. Distributed power sourcesof less than 20 MW per unit could be deployed on both the supply and customerside of the energy/information portal as essential assets dispatching reliability,capacity, and efficiency. Today’s distribution system, architecture, and mechan-ical control limitations in effect prohibit this enhanced system functionality.

. Accelerating end-use efficiency through digital technology advances. The growingtrend toward digital control of processes can enable sustained improvements inefficiency and worker productivity for nearly all industrial and commercialoperations. Similarly, the growth in end-use electrotechnologies, networked withsystem controls, will afford continuous improvements in user productivity andefficiency.

4. Capabilities of the smart power delivery system

The knowledge-based economy of the future will require a smart power deliverysystem that links information technology with energy delivery. The concept of thesmart power delivery system includes automated capabilities to recognize problems,find solutions, and optimize system performance. The basic building blocks includeadvanced sensors, data-processing and pattern-recognition software, and solid-statepower flow controllers to reduce congestion, react in real time to disturbances, andredirect the flow of power as needed. There are three primary objectives:

1. Optimize the overall performance and resilience of the system. An array of sen-sors will monitor the electrical characteristics of the system (voltage, current,frequency, harmonics, etc.) and the condition of critical components, such astransformers, feeders, and circuit breakers. The system will constantly ‘‘fine-tune’’ itself to achieve an optimal state while constantly monitoring for potentialproblems that could lead to disturbances.


2. Respond instantly to disturbances to minimize impact. When an unanticipated

disturbance takes place on the system, it can be quickly detected and identified.An intelligent islanding or sectionalizing scheme, for example, can be activatedinstantaneously to separate the system into self-sustaining parts in order tomaintain electricity supply for consumers according to specified priorities and toprevent blackouts from propagating.

3. Restore the system after a disturbance. Following a major disturbance, actions

will be taken to move the system toward a stable operating regime. To do so,the state and topology of the system need to be monitored and assessed in realtime, allowing alternative corrective actions to be identified and the effectivenessof each determined by look-ahead computer simulations. The most effectiveactions would then be implemented automatically. When a stable operatingstate is achieved, the system will again start to self-optimize. Meeting theseobjectives is an iterative process, with optimizing being the primary objectiveduring normal operation. During a disturbance, the operating objective shiftsfrom responding, to restoring, and then back to optimizing. The smart powerdelivery system is thus said to be self-healing.

5. Technology for a smart power delivery system

Some of the key technologies that will be needed to implement a smart, self-heal-

ing grid are summarized below.

5.1. Solid-state power flow controllers

By acting quickly to provide real-time control, solid-state power flow controllers,

such as Flexible AC Transmission System (FACTS) and Custom Power devices, can

increase or decrease power flow on particular lines thus alleviating system conges-

tion. In addition, these controllers enhance system reliability by counteracting transi-

ent disturbances almost instantly, enabling the system to operate closer to its thermal

limits. After nearly 25 years of R&D, FACTS and Custom Power controllers based

on silicon-power electronics are now available. The major developmental challenge

is to reduce the cost of these systems to achieve more widespread use.

5.2. Anticipation of failures and disruptions

Substantial work has been done by EPRI and others to determine the root cause

of failures in critical components such as transformers, cables, and surge arresters,

and to develop monitoring and diagnostics systems for these components. The next

step is to develop fault-anticipation technology that provides early warning and

failure forecasting. Work on fault anticipation for overhead distribution systems is

currently underway.


5.3. Adaptive islanding

Following a terrorist attack or major grid disruption from natural causes, initialreaction will focus on creating self-sufficient islands in the power grid, adapted tomake best use of the network resources still available. To achieve this aim, newmethods of intelligent screening and pattern extraction will be needed, which couldrapidly identify the consequences of various island reconnections. Adaptive loadforecasting will also be used to dispatch distributed resources and other resourcesin anticipation of section reconnection and to help stabilize the overall trans-mission and distribution system.

5.4. Real-time wide-area monitoring system

Elements of a real-time wide-area monitoring system (WAMS) are already inoperation on both the transmission and distribution systems. WAMS is a strongfoundation on which to build the real-time WAMS required for self-healing. Thesystem architecture will define the data, communications, and control requirementsfor the self-healing grid.

5.5. Wide-area control systems

Once predictions have been made about the effectiveness of various potentialcontrol actions, the identified actions need to be carried out quickly and effectively.Achieving this goal will require automating many operations that will make humanintervention on both transmission and distribution systems more efficient. Thechallenge is to develop new equipment with the required intelligence while alsodeveloping strategies for retrofits to existing equipment.

6. Enhancing the portfolio of generation options

The 21st Century Transformation reflects both the generation and delivery ofelectricity. The stakeholder community universally acknowledges the importance ofmaintaining and, to the degree possible, expanding the portfolio of generationsources in order to assure the greatest security and least cost of electricity supply.Stakeholders broadly favor fuel diversity as a means of hedging against high fuelprices and managing the transition from the current generation mix to a low-car-bon-emitting energy economy.In addition to facilitating deployment of distributed power sources (including

renewable energy), there is widespread recognition of the continued need for coaland nuclear power. There is considerable concern, however, that the aging fleet ofcoal-fired generating capacity is well past its prime and in need of replacement if itis to meet the needs of the future. One major opportunity for improving theefficiency and environmental performance of coal is through ‘‘refining’’ it into cleangaseous fuel or feedstock. There are also important opportunities to enhance theperformance and lower the cost of both nuclear and renewable energy technolo-gies. All of these are critical to a sustainable energy future.


There is broad stakeholder encouragement for developing and incenting thedeployment of a portfolio of technological options for reducing CO2 emissionsfrom electricity production. Stakeholders generally support additional research inthe area of carbon capture and sequestration; however, there is some skepticismabout whether this approach can overcome its economic and environmental chal-lenges. Stakeholders also generally support studies of new approaches to using coalas a fuel. In that regard, in February 2003, the US Department of Energyannounced its proposed FutureGen project, which contemplates a one billion dol-lar collaborative initiative with industry to design, build, and operate an integrated,coal-gasification, combined cycle power plant with carbon capture and seques-tration.Distributed energy resources (DER), in the context of this broader transform-

ation, becomes an integral asset in the electricity supply system. DER can have alarge positive effect on reliability and power quality as the configuration of thepower supply system becomes more compatible. This includes deploying DER atconsumer sites as an integral part of the power supply system. As DER grows, itcould fundamentally change the relationship between power supplier and con-sumer, and in time the network architecture of the distribution system, to enabletwo-way flow of power and communication. It could also enable competitive mar-kets for a broad range of distributed services. Technology advances have set thestage for the emergence of a new generation of higher-margin energy services,including power quality and information-related services. Over time, a true tradingmarket could be created for all energy assets. Led by the monetization of demand-response and emissions (SOx, NOx, CO2, Hg), this program could eventually growto make tangible a broad range of energy ‘‘externalities,’’ including resourcedepletion and security.

7. Value of the 21st century transformation

The value of the 21st century transformation goes well beyond the opportunitiesit opens for the electricity sector. In fact, its greatest value arises from the opportu-nities it opens for society as a whole. A transformed electricity sector has thepotential to enhance economic productivity, improve energy efficiency and resourceutilization, and generate substantial additional wealth to meet the growing societalneeds of the 21st century.

7.1. Infrastructure implications

Despite the promise of digital technology for boosting US productivity growthrates, it remains a ‘‘thoroughbred technology,’’ given its speed and fragility. Digitaltechnology is highly sensitive to even the slightest power disruption (an outage ofless than a fraction of a single cycle can create a crash), as well as to variationsin power quality due to transients, harmonics, voltage sags, etc. Digital-qualitypower, with sufficient reliability and quality to serve growing digital loads, nowrepresents less than 10% of total electrical load in the US. It may reach 30% by


2020 under business-as-usual conditions, and as much as 50% under optimum con-ditions where the power system is revitalized with new all-electronic switches andcontrols.In contrast, the electricity supply infrastructure has changed very little, and

almost no provision is being made to meet the changing needs of the economy. Infact, the investment needed to upgrade the infrastructure has reached new lows.Capital expenditures by US electricity providers were only about 12% of revenuesduring the 1990s, less than half of historic minimum levels and even below the levelreached briefly during the Depression. Annual investment in the transmission sys-tem has been cut in half since 1975. In particular, the delivery system is not keep-ing up with the demands of digital technology. The transmission and distributionsystems were designed for the industrial era of the 1950s and 1960s, when mechan-ical switching and radial network design was adequate.Despite increased demands placed on the system, capital expenditure plans

announced by utility companies suggest that the underfunding trend is not beingreversed. Projected expansion of the transmission system is roughly one-quarter ofthe projected growth in demand. As a result, line congestion is growing, as indi-cated by the near doubling of requests for transmission line relief (TLR) between1998 and 2002. This is further exacerbated by the exponential growth in competi-tive wholesale power market transactions.The key concern is that a large gap is opening between the economy and the

infrastructure that supports it. Without substantial investment, the electricity sup-ply system will almost certainly become a drag on future US productivity growthrates.

7.2. Signs of trouble

There are already signs of trouble. The power supply system is growing increas-ingly vulnerable in several regions. In some parts of the country, electricity con-sumers already suffer from inadequate generation or from transmission congestionduring periods of high demand. This process is often exacerbated by historicallylow patterns of investment in infrastructure. In this regard, the blackout thatoccurred in the Northeast on August 14, 2003 represents only the tip of a larger,more pervasive, and growing reliability iceberg.Capacity limitations on the supply side, coupled with power interferences and

disturbances on the customers’ side, can sometimes lead to economic losses thatcascade through the value chain, leading to losses sustained by both industrial cus-tomers and their suppliers. Although the losses to consumers are enormous, therehave been very little data to comprehensively document and quantify the currentsituation. Most estimates begin and end with the momentary impact at the point ofdisturbance.In fact, losses are often quite varied in nature and go well beyond the immediate

point of impact. For example, a nearly imperceptible, one-second sag in voltage inone of the microprocessors running a paint gun in an auto plant could destroy thefinish on one or more cars and disrupt part of the assembly process. Similarly, a


momentary disruption at a plant that produces microprocessors could ruin an

entire thirty-day batch, and possibly the semiconductor equipment itself.Furthermore, in the tightly integrated supply lines typical of today’s just-in-time

production, a small disruption can cascade upstream to hundreds of local suppli-

ers, thus compounding the economic loss. In general, economic loss can include

downtime, loss of raw material, damaged product, damaged equipment, disruption

of supply chains, and even bankruptcy. In industries such as information and

financial services, concerns over power reliability have become ‘‘bet-the-company’’

investment decisions. At one new NASDAQ center in Connecticut, for example,

the cost of power conditioning accounted for nearly two-thirds of the cost of the

entire facility. A similar ratio of power conditioning to total facility cost (68%) was

found at a new Internet facility in Miami. These are anecdotal figures, but they

highlight the fact that the cost of power disturbances has risen dramatically in the

last few years.In an effort to get a better handle on the economic loss from power reliability

and power quality problems of all types, EPRI extensively surveyed some key

industries in 2000 and extrapolated the results. The survey results were substan-

tially higher than historic estimates, and subsequent analyses indicated that the

aggregate economic loss to the nation has climbed to more than $100 billion per

year, or more than 1% of US GDP. These results certainly warrant further confir-

mation, but they are not out of line with the almost total reliance of business,

industry, and commerce on reliable electricity. The costs of these power dis-

turbances are parasitic in nature and go largely unreported. There is no question,

however, that the costs are passed on by businesses to consumers in the form of

increased costs of goods and services. Such costs are almost certain to climb in the

years ahead unless action is taken to improve power reliability and quality.There are other troubling signs of problems with the current power infrastruc-

ture. Serious incidents reflecting constrained capacity, often accompanied by price

spiking and questionable financial dealings, have occurred in six of the last seven

years (1996–2003). These problems have affected California, the Northeast, and the

Midwest. Most observers have concluded that the problems experienced during the

last two years would have been even worse had it not been for the economic down-

turn and resulting impact on electricity demand.Other problems arise from the threat of terrorist acts of sabotage that would

compromise the security of the power system. The electricity system is a large and

inviting target, and disruption of the grid would cause loss of human life and losses

to society that extend far beyond the power system itself.A final area of grid vulnerability is its growing inability to support the needs of

competitive markets for electricity and related products and services. A massive

transformation is needed to provide the grid with the policies, protocols, and tech-

nologies needed to support markets.


7.3. Short-term and long-term responses

The electricity supply system is in need of modernization, not just expansion.

The nation finds it is in the awkward position of using a system that still depends

on obsolete electro-mechanical switches to power a 21st century economy built on

billions of microprocessors that operate at the speed of light. In fact, the grid is

becoming incompatible with the nation’s economy. Fortunately, a number of inno-

vative solutions to the system’s vulnerabilities are well-developed and, in many

cases, ready for deployment.Responses to the growing need for improved power quality are both short-term

and long-term. Many of the short-term responses lie on the consumer side of the

meter, where businesses with the need for ‘‘perfect power,’’ such as financial insti-

tutions and high-tech manufacturing, will gain greater reliability through the use of

redundant power supply and power conditioning systems. The demand for unin-

terruptible power supplies on or close to consumer premises is growing rapidly,

and some high-tech firms and industrial parks have begun to plan for their own

microgrids—small islands of digital quality power in a sea of traditional power.Some short-term solutions, however, are upstream of the meter. Activities such

as improving maintenance practices, monitoring the ‘‘health’’ of critical equipment,

and better preparations for outage recovery can materially reduce productivity los-

ses. One reason these and other fixes have not been implemented on a wide scale is

the mismatch between who gains and who pays— in this case the electricity end-

user realizes the benefits, while the distribution company incurs the costs. More-

over, the costs of unreliability are usually internalized by the commercial end user,

who passes the costs on to its consumers—a mechanism typically not available to

the distribution companies. Some stakeholders believe that as awareness of the

problem and the potential investment benefits grows, rate recovery will be allowed.Longer term, it is crucial that the supporting power supply infrastructure be able

to keep pace with the growing digitization of the economy. The rigor and pace of

global competition, now impacting virtually every business in the US, are major

drivers in the move to digitally controlled electricity use. It is hard to imagine any

major industrial process, manufacturing facility, or commercial business in 2020

that will not be utilizing digital control and interactive links to its consumers

through the ‘‘energy Web.’’ As described in Wired magazine (July 2001), the energy

web will become a national system in which ‘‘every node in the power network is

awake, responsive, adaptive, price-smart, eco-sensitive, real-time, flexible, and

interconnected with everything else.’’Electricity has had a long history of stimulating and sustaining economic growth

and improving the efficiencies of all factors of production. This is particularly

true for the productivity of labor and energy. Now, the self-healing grid and the

energy/information portal will drive a new wave of productivity growth. Com-

bined with the development of advanced end-use electrotechnologies, the 21st cen-

tury transformation of the electricity sector will introduce new efficiencies into the

use of energy, labor, and capital for industry, business, and homes.


Improving worker productivity is particularly important as we look toward thedemographic challenges of the new century. Birth rates are declining in mostdeveloped countries. Although these effects are currently less pronounced indeveloped countries with large immigrant populations, such as the US, Canada,and Australia, the growing social needs of an aging population will ultimatelyaffect all countries, developed and developing. Worker productivity will have toincrease substantially to meet the social costs of a growing retired population.Realizing the 21st century transformation will be critically important to boosting

productivity growth rates and enabling trillions of dollars of additional revenue foruse by both the private and public sectors. Fig. 1 portrays the combined potentialbenefits enabled by a transformed electricity infrastructure, both in terms of stem-ming power-disturbance costs and taking the brakes off economic growth. Giventhe innovative opportunities that are emerging, it is likely that this projection onlyscratches the surface of what will be enabled for our economy and quality of life.

8. Conclusion

The ultimate goal of the Electricity Sector Framework for the Future project isto establish a coherent set of actions and accountabilities that will enable the elec-tricity sector to meet the escalating needs and aspirations of its customers, inves-tors/owners, and society. In order to be effective, such a set of actions, by theirnature, must reflect mutual self-interest and equity across the broad electricitystakeholder community.

Fig. 1. Combined potential benefits from a transformed electricity infrastructure.


In general, this requires a unified industry leadership vision and commitmentthat electricity, through innovative technology, has a service value greater than itstraditional basic commodity value. This vision of innovative opportunities to trans-form the reliability and value of electricity for the 21st century must ultimately be‘‘sold’’ to the public and policy leaders at the local, state, and federal levels whocan credibly advocate the message. In addition, we must expand initiatives to edu-cate stakeholders as yet another mechanism for strengthening industry credibility,building trust, and gaining broad public and political support for the sector visionand its needed actions. Finally, the costs and benefits must be made tangible, com-pelling, and urgent for all stakeholders, especially consumers.

Kurt E. Yeager is President and Chief Executive Officer of the Electric Power Research Institute (EPRI),

headquartered in Palo Alto, California. EPRI is the national collaborative research and development

organization for electric power. Mr. Yeager is a Fellow of the American Society of Mechanical Engi-

neers and its Industry Advisory Board, a Trustee of the Committee for Economic Development, and he

serves on the Boards of the US Energy Association and the National Coalition for Advanced Manufac-

turing (NACFAM). He has authored over 200 technical publications on energy and environmental

topics. Mr. Yeager received a Bachelor’s degree from Kenyon College and completed post-graduate stu-

dies in chemistry and physics at Ohio State and the University of California, Davis. He has also com-

pleted post-graduate management programs at the Industrial College of the Armed Forces and the

University of Pennsylvania Wharton School of Finance.

electricity for the 21st century: digital electricity for a digital economy

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