00:00 Speaker A
We’re definitely seeing on the wire side of the business a continued growth in the cost of delivering electricity. This is separate from supplies. But the cost of delivering the energy through big transmission lines and distribution systems has grown. You see that on your uh gas bill, too.
00:23 Speaker B
Where are we on grid modernization too with those costs and how that feeds into everything? So you have the demand supply question, and then you have the, you know, changes to the grid that you were talking about. Is that where are we on that?
00:39 Speaker A
I think in terms of affordability, we now have a robust enough grid that the real risk of it is underutilization. And I know people say, hey, how could that possibly be? I’m hearing about all of this power demand. But 99% of the hours, the grid is dramatically underutilized. Think about fall and spring where temperatures are pretty moderate. Think about nighttime where there’s no nighttime ship. We want to utilize the grid during those hours.
01:13 Speaker A
Think about it. The public owns this resource. And it’s a fixed cost resource. It costs so much, you want to be able to sell the excess capacity in that grid as often as possible. Every grid in the US, every one of them, I don’t care where you are, is utilized at a load factor that’s less than 50%.
01:40 Speaker A
80% of the time, about 50% of America’s power plants don’t even run. Okay? So this is a very peaky system.
01:52 Speaker A
And when we brought AI in initially, what it was triggering is price increases at the peak. But what we’re doing now is working with the customer to be flexible at the peak, reduce consumption at the peak, use their backup generation, use battery storage, demand response, other tools to be able to reduce their demand at the peak, mitigate customer bills as and then utilize the grid every other hour where there’s excess supply. That’s how we create affordability.
02:29 Speaker B
Some of these data centers even potentially selling power back into the grid at times that they’re not using it. I mean, other businesses do this as well, right? So that that could be a potential model that we could see going forward.
02:45 Speaker A
Yeah, I I I think it’s as little as this. Right now, if the Environmental Protection Agency were to revise its rules, which is underway, to allow backup generators at these data centers to operate, call it another 40 hours a year. There’s 8,760 hours a year.
03:09 Speaker A
So we’re talking about a small fraction of excess capacity in that system that we could tap into that really would make the biggest difference for consumers.