The utility industry is undergoing a period of significant transformation, driven by rapid innovation, substantial growth, and the increasing importance of sustainability. At Salt River Project (SRP), we’re at the forefront of these changes, implementing strategic initiatives to address the challenges and opportunities that lie ahead. Â
As SRP’s senior director of Distribution & Technology Operations, I had a chance to share insights on these topics during my presentation at INFOCUS Conference 2024 in Tempe, Arizona. Here, we explore the key themes from my presentation, focusing on SRP’s efforts in growth, sustainability, and technological innovation.Â
A legacy of growth and innovationÂ
SRP has a rich history spanning over 120 years, rooted in early federal reclamation projects. Today, we are the third-largest public power utility in the United States, serving about two-thirds of the Phoenix metro area. Our mission is to deliver affordable, reliable, and sustainable energy to our customers, a task that is increasingly complex due to rapid growth and evolving customer expectations.Â
As a not-for-profit organization, everything we do is in support of our customers and community. SRP has historically taken an innovative approach to building out and managing our infrastructure as well as providing customer solutions. This has enabled SRP to be an industry leader in both reliability and customer service and positions us well to respond to future challenges. Â
The Phoenix area has experienced significant growth since the 1950s. More recently, from 2014 to 2023, we saw an average annual growth rate of a respectable 2%. However, recent developments in the advanced manufacturing and data center markets have helped accelerate this growth to unprecedented levels. The Phoenix area is now the sixth-largest data center market in the world. In our financial plan for the next six years, we are accommodating a 7% annual growth rate, a significant increase that presents both opportunities and challenges.Â
The shift toward sustainabilityÂ
Customer expectations have evolved dramatically, particularly in the last decade. Sustainability has become as critical as reliability and affordability. Utilities play a pivotal role in decarbonization of our society by adding clean energy to our portfolios and using that clean energy to support the electrification of the transportation and industrial sectors.Â
At the same time, climate change poses challenges to grid resiliency given the increasing frequency of more intense storms, temperature extremes, and wildfires. Additionally, driven by advancements in technology, customers are now more eager to participate in the energy ecosystem that enables distributed generation, energy storage, and flexible loads. These factors necessitate enhancements in grid resilience to maintain reliability while striving for a carbon free future. Â
Source for all blog post visuals: INFOCUS 2024 presentation by Chris Campbell, Salt River Project: “Navigating the Rapid Pace of Change”
Adapting to a changing grid
The changes in our industry extend beyond resource portfolios to the very structure of our grid. Our system will need to accommodate 3,500 megawatts of additional energy capacity by 2030, while retiring 1,700 megawatts of coal generation. This requires us to add over five gigawatts of capacity over a very short period.
By 2035, our total system capacity is planned to reach 28 gigawatts, more than double our current capacity. This expansion will be facilitated by significant increases in renewable energy. Solar capacity on SRP’s grid is expected to grow from three gigawatts in 2025 to twelve gigawatts by 2035, necessitating substantial investments in energy storage to ensure reliability. These investments include short-duration storage and longer-duration solutions like pumped storage.
Managing this level of change in such a short period of time requires a proactive approach related to integrated planning, managing technology and enabling the workforce.
Preparing for the future
Long gone are the days where you could plan the various domains of an electric grid independently. These domains now create a highly integrated energy ecosystem. Our approach to planning and executing grid expansion must become more holistic and proactive. We recently completed an integrated system planning process that considered the interconnectedness of the energy ecosystem. This helped SRP create a robust plan that adapts to future challenges and effectively leverages technology.
The Integrated System Plan (ISP) provides the blueprint for how the SRP grid will evolve over the next 10 years. Additionally, more detailed plans then support the execution of the ISP and ensure the necessary coordination across domains.
Embracing technology and innovation
More than ever, technology underpins the modern grid and is a cornerstone of our strategy to manage this growth and complexity. Operational technology (OT), which encompasses the digital tools used for real-time grid operations, is becoming increasingly integrated and sophisticated. At SRP, we have established a comprehensive operational technology strategy that integrates strong governance with a comprehensive technology roadmap. This ensures we can manage the complexity of a more integrated and technologically advanced grid.
We also recognize the importance of our workforce in this transformation and its need to navigate continuous change. A proactive workforce strategy that accommodates effective organizational design, a balanced resource strategy, and proactive staff development is critical. Our approach focuses on optimizing roles, balancing workload requirements, and ensuring continuous training and development. Embracing a culture of constant change and committing to effective training to facilitate this change are essential for success.
Looking ahead
The utility industry is undergoing unprecedented change. To navigate this, we must be proactive, embrace change, and prepare for the future. At SRP, we’re committed to being at the forefront of this transformation by leveraging technology and fostering a resilient and capable workforce.
Interested in learning more about how we’re driving innovation in the utility industry? Visit our website to explore our latest projects and initiatives and see how SRP is leading the way in sustainable energy solutions.
