The main challenge to utilities today?

Uncertainty!

Just take a look at the CNBC interview of Andrew Brandler, CEO of CLP Holdings, shortly before Christmas. Brandler talks about the industry’s acknowledgement of the need for “de-carbonization,” or ending the reliance on fossil-fueled energy sources and moving toward more renewable energy sources. But Brandler notes that the economic case for building and adapting renewable energy sources is largely driven by government subsidies and fossil fuels are so much cheaper to produce and burn as compared to the production of non-carbon emitting energy. He talks about how coal makes more sense economically to the Asia countries that are investing in the power sources that allow their economies compete.

Brandler knows he needs to move more of his generation portfolio clip_image002toward renewables sooner than later and if he can establish a strong position in the renewables and nuclear as well, CLP will be setup for strong growth down the road as the world accelerates its de-carbonization.

What will CLP’s portfolio look like?  It depends. Governmental policies in each country CLP operates in will determine the most attractive non-fossil fuel alternative. For a holding company that operates different types of generation over a wide region, this scenario requires CLP look to its IT system for incredible agility, especially as it tries to hold the line on costs and bring more renewable sources into its portfolio.

You have to sympathize with Brandler, who talks about his company’s goal of bringing more renewables online, even while talking about the Asian countries’ penchant for the low cost of fossil fuels.

Contrast the uncertainty faced by Brandler with the best case situation of having an IT architecture, such as SERA, that supports changing business requirements no matter whether they are regulatory- or cost-based. CLP just happens to be a very good MS customer and our view is that they are well positioned with an enterprise IT architecture that continues to evolve and that will enable CLP to quickly integrate future evolving technologies and capitalize on new business opportunities as the de-carbonization process goes into high gear. – Jon C. Arnold