Innovation in the Power Sector

1
Innovation in the Power Sector

• Building a Smarter, Cleaner Electric System

Jeff Sterba Chairman, President CEO PNM
Resources February 7, 2008
2

• Growing Demand
• Modernization of infrastructure
• Rising Costs and Prices
• Climate Change
• Customer Expectations

Major Challenges Facing the Electric Utility
Industry
3

• Investments in the Smart Grid
• Focus on energy efficiency and DER
• Cleaner generation technology
• New business and regulatory models

What is required to respond to these challenges?
4
Investment in Smart Grid electricity
infrastructure will be needed.
5
. and the infrastructure needed to support
deployment of energy efficiency.
6
Challenge of Climate Change
2005
2020
The area of each pie chart is proportional to the
respective years total generation.
2050
2095
oil
gas
coal
fossil with capture
non-emitting
Source EPRI
7
Current technology will not get us to where we
need to be
Where todays technology will take us
Where more advanced versions of current
technologies will take us
Path we need to be on to stabilize atmospheric
CO2 at 450 to 550 ppm
8
Reducing CO2 will require a portfolio of
resources and new technologies
EIA Base Case 2007
2006 level
Source EPRI 2007
9

• Acceleration of RDD and funding
• Prices to Devices
• Customer control, not command and control
• New business and regulatory models

Final Observations