New regulatory frameworks encourage electric infrastructure investment.
David K. Owens is executive vice president at the Edison Electric Institute business operations group.
The electric power industry is building for the future. We’re building a cleaner, more advanced, efficient, and diversified generation fleet. We’re exploring methods for capturing and storing carbon. We’re creating a smarter electrical grid and modernizing our transmission and distribution system, which also will help us to expand our efforts to help our customers become more energy efficient.
Today, our industry is spending approximately $80 billion per year building new infrastructure—about twice the amount we spent in 2004. Looking ahead to 2030, one major economic firm has estimated that the industry will invest another $1.8 trillion in developing a more advanced and diversified generation fleet, meeting increasingly stringent environmental standards, and modernizing its transmission and distribution systems.
These new investments will help to ensure high levels of reliability. And they will help to improve customer service, as well as promote public policy goals, such as lowering power plant emissions, increasing customer energy efficiency, and supporting the introduction of electric cars and trucks. But just as the industry is seeking to raise and invest large amounts of capital, sales growth has slowed, making it difficult to fund new investments without rate increases.