Beyond Commitments: Assessing Utility Transformation to Clean and Modern | SEPA Skip to content
Join SEPA

Beyond Commitments: Assessing Utility Transformation to Clean and Modern

Utilities are making progress, but much work remains

WASHINGTON, D.C. — For more than a century, our nation’s electric utilities have kept the lights on, powered our economy and created an engineering marvel in the U.S. electric grid. Now, the electric utility industry is changing like never before. Falling clean energy costs, climate change concerns, mounting pressure from investors, public policy and evolving customer preferences are driving an industry-wide transformation to a modern and carbon-free energy system.

This transformation requires much more than clean energy generation. The Smart Electric Power Alliance (SEPA) launched the inaugural Utility Transformation Challenge to make a comprehensive, honest assessment of U.S. electric utilities’ progress towards a modern, carbon-free energy system.

SEPA conducted and analyzed multiple surveys designed to measure meaningful progress across multiple dimensions of utility infrastructure, programs, strategy and operations. Insights derived from these survey results form the basis for a new report: the 2021 Utility Transformation Profile.

SEPA received survey responses from 135 individual utilities, representing more than 83 million customer accounts, or approximately 63% of all U.S. electric customer accounts. The report examines the utility industry’s transition to a clean and modern energy system by exploring four dimensions of utility transformation: Clean Energy Resources, Corporate Leadership, Modern Grid Enablement, and Aligned Actions and Engagement.

What did we learn from evaluating the utilities leading the clean energy transition?

  • Explicit commitments to carbon reduction are an important and necessary first step for utilities. Utilities with stronger commitments have made the most progress.
  • The transformation goes beyond clean energy resources. A comprehensive approach is needed that touches all dimensions of the utility business and operations.
  • A transformation of utility culture is necessary. Leadership, transparency and accountability facilitate the transition to a clean and modern future.
  • Utilities can’t achieve a carbon-free system alone. Leading utilities are proactively and strategically working with stakeholders to facilitate the transformation.

SEPA also unveiled the 2021 Utility Transformation Leaderboard, which recognizes the ten utilities that have demonstrated the greatest progress in the transition.

2021 Utility Transformation Leaderboard Utilities (in alphabetical order)

  • Austin Energy
  • Consolidated Edison of New York
  • Green Mountain Power
  • Holyoke Gas and Electric Department
  • Los Angeles Department of Water and Power
  • Pacific Gas & Electric
  • Sacramento Municipal Utility District
  • San Diego Gas & Electric
  • Seattle City Light
  • Southern California Edison

“These leaders stand out due to their comprehensive efforts to transition to a carbon-free energy future, and most importantly, their results,” said SEPA president & CEO Julia Hamm. “We applaud the leaders for their progress, and recognize that much work remains. The world does not have the luxury of time on carbon reduction.”

“Electric utilities are essential partners in the clean energy transition. The progress that these ten utilities have achieved, and that so many others like them are achieving, now needs to accelerate,” said Ralph Cavanagh, energy program co-director at the Natural Resources Defense Council. “In their collective efforts and commitments, and the clear consensus in the utility sector about the importance of clean energy progress and the movement to a zero-carbon future, lies the best hope for an affordable, reliable and environmentally sustainable energy future.”

“We are honored to be a part of SEPA’s Utility Transformation Challenge,” said Seattle City Light general manager and CEO Debra Smith. “I think we all recognize the need to transform is a constant in our lives, businesses, and society. Creating a carbon-free energy system is never truly complete. City Light will continue to lead these efforts as our region moves toward a cleaner energy future.”

“It’s humbling because so many energy companies across the country are applying their people’s talents and dedication to innovate and lead the transition to a clean energy future,” said Tim Cawley, CEO of Con Edison Inc. “It’s a source of pride because it acknowledges Con Edison’s progress in following through on our Clean Energy Commitment. We support New York’s aggressive environmental goals and we’re doing our part to help achieve them.”

Based on the results, SEPA offers recommendations for utilities of all sizes, types and geographies as they pursue their own path of transformation:

  • Strengthen carbon reduction commitments by setting ambitious, science-based targets with interim goals and detailed plans to achieve them.
  • Address the transformation comprehensively across the organization through changes to processes, programs and structures that will accelerate clean energy adoption.  Examples include: pursuing integrated distribution planning, interconnection processes, evaluating non-wires alternatives (energy efficiency, demand flexibility, storage, etc.) to meet demands, developing a transportation electrification strategy and efficiently integrating and leveraging distributed energy resources.
  • Embrace the clean energy transformation as a core element of the utility mission and culture. This will require changes, such as linking executive compensation to reduced carbon emissions, establishing transparent emissions tracking and reporting programs and pursuing internal sustainability and carbon reduction programs (e.g., fleet electrification and supply chain programs).
  • Engage customers, technology partners, peer utilities and regulators early and often. Common understanding and shared vision of new initiatives and technology deployments is critical to facilitate innovation.
  • Integrate Equity considerations and goals into efforts and programs to ensure all community members are able to participate in and benefit from the clean energy transformation.

“All utilities—including those leading the way—face key challenges ahead that will require new thinking, collaboration and, sometimes, hard choices,” said Sharon Allan, chief strategy officer at SEPA. “The transformation to a clean and modern energy system is complex, and each utility’s journey will be unique. We believe that adopting and implementing these recommendations can help utilities to accelerate their smart transformation.”

The 2021 Utility Transformation Profile report and Utility Transformation Leaderboard are available here. Download the executive summary here. View frequently asked questions here. Watch a recording of the launch event here.

For media requests, please contact Jordan Nachbar, jnachbar@sepapower.org, 202-559-2034

Share