Though the COVID-19 pandemic has filled 2020 with unique and unprecedented challenges, the year was also a breathtaking time of development in the electrical transmission and distribution industry. Renewable generation had a moment in the sun and battery electric storage continued to expand its footprint, while renewable natural gas began to emerge.
As much of the economy took a hit from lockdowns and business restrictions, the power sector proved essential in keeping critical infrastructure in service without interruption. Although office work declined precipitously, overall demand held strong in support of so many homebound individuals.
Many of us will be hoping for a return to more placid times in 2021, but we expect disruption will continue to be a theme in the months ahead. For those making 2021 business plans, decarbonization, construction challenges, and integration of newer technologies should be significant factors to address.
Decarbonization
Momentum has clearly swung in favor of decarbonized power, which can include solar and wind as well as emerging difference-makers like renewable natural gas and offshore wind, along with a continued push toward electrification of transportation and heating. Of all the new power capacity added in the United States in the first nine months of 2020, 70% was from renewables, according to CleanTechnica. States and countries have increasingly committed to clean power and net-zero goals, and at least half a dozen major electrical utilities and several corporations are following suit in setting carbon neutrality targets.
The increase in demand for power from renewable and decarbonized sources is a continuation and acceleration of a trend toward shifting loads and changing demand curves. Grid modernization work is essential to adapting the legacy electrical grid for new applications and load profiles that look much different from those of the past, not to mention the growing importance of hardening the grid against natural and malign threats.
Even as society moves away from fossil fuels, the reality remains that intermittent generation sources will need to be backed with reliable baseload generation. In the future, this might take the form of energy storage, but the low cost of natural gas and its relatively low emissions (in comparison with coal) will make it an essential piece of the power portfolio for a long time to come.
Construction
Projects in some industries paused or were canceled, but power work has continued as a vital element of the critical infrastructure keeping communities connected. Enhanced safety measures have been put in place in the field to protect safety and health, and the business of enhancing reliability and resiliency continues apace.
The 2021 Dodge Construction Outlook from Dodge Data & Analytics forecasts a tepid recovery with a 4% increase in total U.S. construction starts, to US$771 billion. The power sector is predicted to be much stronger, with a projected 35% increase for electric utilities and gas infrastructure. The report expects this to be led by groundbreaking for wind farms and several liquefied natural gas (LNG) export facilities. Such initiatives would imply plenty of work on the horizon toward interconnecting the former and transmission infrastructure for the latter.
Expanding capacity, enhancing grid reliability, and modernizing telecommunications remain vital jobs, and they all come at a price. It remains vital for utilities to clearly and thoroughly make their rate cases in support of the long-term benefits of their programs and major construction projects. Even amid increased attention to sustainability, J.D. Power found in July 2020 that U.S. electric utility customers have very low levels of awareness of their utilities' sustainability efforts. Without greater awareness, it will be challenging to achieve the popular support necessary to support capital investments in achieving long-term objectives.
Technology
Integration of new technologies is a key to increasing communication, workflow efficiencies, and asset assessments. Digital transformation is making a substantive difference in improving record-keeping and streamlining operations and maintenance for utilities. 3D scanning and modeling technologies continue to improve and are a project essential, not merely a valuable bonus.
A wide range of project types can call upon a wealth of innovative technologies to help meet client objectives. Assisted reality has demonstrated astonishing leaps as a way to minimize site visits and reduce safety hazards. (Our wearable technology partnerships are a testament to how important we believe this will become.)
Private LTE networks are increasingly looking like wise long-term investments for utilities to maintain reliable communications among new and existing assets. The Federal Communications Commission (FCC) had a busy 2020 as it opened several swathes of bandwidth to new uses, including making available spectrum for PLTE but also opening dedicated 6-GHz spectrum that utilities had been using for Wi-Fi operation, creating risk of interference. Some measures may help utilities and developers; others might pose challenges to incumbents. As a new U.S. federal administration takes the helm, many will be keeping a close eye on how bandwidth management might continue to evolve.
Executing successful projects and maintaining dependable, cost-effective operations are the bottom line in every year. Recognizing trends and adapting to a changing environment for the power sector will help utilities make the most of their opportunities in the near term and beyond.
System reliability remains paramount as the environmental and economic benefits of renewable generation stimulate rapid growth of decarbonized sources in the power generation mix.
