The Center for the New Energy Economy recently held it’s third annual “Natural Gas Symposium – Doing Energy Right” Conference. Kicking off the conference was a discussion moderated by former Colorado Governor Bill Ritter with CEO of GE, Jeffrey Immelt and Noble Energy CEO Chuck Davidson.

The discussion highlighted a significant shift in the dynamics of energy production, management, policy and regulation. It also signaled an endorsement of innovation and advanced energy solutions to 21st century challenges.

Jeffrey Immelt led the charge by declaring that GE “believes in the science of climate change,” and their investments reflect that belief. He further reflected, “We need good regulation.” GE endorses a strong but predictable regulatory regime - one that stimulates innovation and advancement of energy solutions. Immelt acknowledged that there are challenges associated with responsible natural gas development, but suggested: “Let’s turn the country’s great innovators loose to solve these problems. The backbone of this country remains the ability of its people to innovate.”

Chuck Davidson, CEO of Noble Energy also acknowledged the public challenges with natural gas extraction, but echoed Immelt’s call for a strong and stable regulatory environment: “If the public can see where you have strong regulation, they have confidence in the energy sources.” In referencing the possibility of national standards, he reflected that “there’s an opportunity to benchmark states with standard minimums – but all states aren’t alike. There’s an opportunity with a model framework for regulation to let states set the rules within that model that are most appropriate for the state.”

With increasing numbers of communities and some states banning the practice of hydraulic fracturing (fracking) around the country, Davidson said, “Just shutting something down isn’t the answer to how America works. Banning fracking is saying no to oil and gas development since 90% of the wells in America today are fracked. That’s a very important decision.”

Immelt reiterated his solution: “Hold us to a high standard. Every company in the world today has to get a social license to operate. We get this. We understand we need to earn your trust. The best way is to put a high standard in place and get innovation working to solve these problems.”

While methane leakage is a critical issue to natural gas development and estimates of leakage amounts vary widely depending on the study, Davidson laid down the gauntlet on what can be done. “We can achieve near zero percent leakage.” Then he corrected, “no, not near zero – zero.”

Immelt reflected on the history of GE and public opposition to energy development: “We’ve gone from having nuns complaining about nuclear power, to now having the right wing complaining about wind energy. All of the problems with unconventional fuels can be solved. The days of business saying to environmentalists ‘we’re not listening to you’ and environmentalists that want to shut things down – those days are over. This is the era of solving problems. You never want to be playing yesterday’s game.”

IN OTHER NEWS:

AEE member GE Digital together with the Analysis Group released a paper last week that highlights the imperative of shifting business models for utilities in an environment of increasing investment needs paired with declining growth projections.  "Results Based Regulation: A Modern Approach to Modernize the Grid" examines critical challenges of utilities under the current cost based regulatory model and suggests a more appropriate model for the 21st century would focus on outcomes and performance to stimulate investment in grid resilience, reliability, high asset utilization rates and customer oriented services.  The report references the UK RIIO model (Revenues set to deliver strong Incentives, Innovation and Ouptut" as an example of ideas put to action.  AEE referenced the RIIO model in this previous blog post.)