Energy Solutions for the 21st Century
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As one intelligent cartoon character once put it "the future isn’t what is used to be.” Nowhere is this truer than in energy markets, particularly for the belabored investor owned natural gas and electric utilities and their regulators. Over the past twenty years they have dealt with cataclysmic changes in virtually every area affecting the way they do business from fundamental technology changes through significant demand shifts and even down to the basic organization of their industries. The regulators have changed the rules opening up the doors to competition, the competitors altered the playing field by giving utility customers more options, and utilities are responding to this unfamiliar environment using new and untested technologies and strategies. The only certainty now in the energy business is uncertainty.
Survival under these conditions requires rapid adaptation to hard-to-anticipate futures as they become reality. New competition requires fast, thorough analysis that covers territory much larger than those used in previous assessments. The old utility planning protocol divides the duties among supply-planning, forecasting, DSM planning, finance, and rate departments. Each department iterates its detailed models in round-robin fashion and hand carries the outputs between models. The process is cumbersome, slow, ineffective, prone to errors, and much information is lost as output is moved from one model to another. The time and staff intensive process does not encourage the "what if" analysis that so often leads to fruitful research and policy decisions under highly uncertain conditions nor does it offer an easy mechanism to test out ideas or try out strategies under a variety of potential futures.
ENERGY 2020 fills the gap between the isolated, piecemeal analysis using detailed models specializing in specific utility operations such as econometric forecasting, financial analysis and supply planning, and the labyrinthian iteration process required to "integrate" these models for policy development and testing. It is a mature, well established, comprehensive planning and policy analysis tool, designed especially for scenario analysis with a focus on the interactions among households, commercial and industrial companies, electric and gas utilities, and government regulators. ENERGY 2020 can analyze many scenarios quickly and accurately. It complements the detailed models already owned by most utilities and frees up these elaborate and expensive tools for the jobs they were designed for. With ENERGY 2020 far fewer staff and machines need to be tied up for routine planning
ENERGY 2020 saves staff and financial resources for the utility by making comprehensive scenario testing so fast and easy that any possibility can be addressed by a single operator on a PC. The final results are robust because ENERGY 2020 is an integrated model which means all important feedback loops are correctly modeled, and the sensitivity of the energy system to the unknown future conditions is captured. You can be confident that your resource plan chosen on the basis of ENERGY 2020 results will be the right plan under a variety of future "states of the world.”
Utility planners possess no crystal balls and are unable to discern all the necessary information about the present and even less about the future. A utility, however, can be optimally prepared for the future without knowing what that future might be. A utility so prepared will have developed options that are robust under a variety of potential futures. Instead of concentrating on cost-minimization for a "baseline" future that never comes to pass, the utility builds a portfolio of optimal strategies that maximize benefits under all plausible conditions, emphasizing flexibility and cost-effectiveness.
The ENERGY 2020 model was specifically developed to help the planner discern optimal policies and strategies in an uncertain world. The model allows analysts and planners to resolve issues and sort potential strategies in an efficient and comprehensive manner, allowing the planner to quickly incorporate a tremendous amount of information into the decision making process. ENERGY 2020 provides a comprehensive and self-consistent planning framework that realistically simulates all important components of the energy company and its customers, providing a complete and balanced representation of each.