Continuing in this series of articles exploring the 2011 Energy White Paper, this month we will look at the practicalities of planning for our energy future, how we get our energy and finally how we use our energy.Historically, all planning for our energy needs has been capably done by the local utility, and this has worked very well in the past.But we are now entering a different time, in which independent power producers are beginning to enter the market.Of course, we will continue to need Belco they are the local experts who own and operate all of the transmission and distribution on the Island, and Government has no desire for that part of their business model to change.Where there is room for opportunities and growth for others is in the business of energy generation, so this means that other power producers need to be considered when it comes to planning what our energy future looks like.Not just planning needs to be considered, but also the obligations of each party to the other. In an environment where the expectation of an independent power producer may be to not only provide for their own needs, but to sell excess to the grid, Belco need a framework for a business relationship that defines terms of reliability and agrees on fees paid for that electricity just as much as that independent needs to be guaranteed a rate of return for the sale of their electricity. The arrangement has to be mutually beneficial in order to be fair to the greater public.To explain that last point, we hear all the time that the answer is to increase feed-in tariffs. This is the rate paid to the independent power producer for the electricity they produce in excess of anything that they use. That sounds like a very simple proposition, but when you think about it, that may not be a sustainable model for us in this small Island.The utility buys power, then sells it in turn to the public. The rate payer, namely you and me, pay through our electricity rates for that purchased power. Too high a tariff means that the utility has to recover its costs somehow through charging us. Too low a tariff, and a private entity won’t see the merit in investing in renewable energy.Tariff structure therefore has to be a balance, and that balance has to consider matters of reliability, for example. We all know that the sun doesn’t always shine, and on a cloudy day, that solar power producer probably still needs electricity.There is a mutual responsibility in this business relationship if they don’t have sufficient storage, then they need to get that energy from somewhere, and that would be Belco.Belco on the other hand, need to be assured a given amount of electricity from the power producer. If it’s from a renewable source, like sun, what happens on a partly-cloudy day?There is great intermittency, and great variation. There are technical limitations on how much intermittency can be handled at present, and that needs to be taken into consideration as well. Because of the complexity of this new energy environment, there needs to be oversight and regulation, and that’s where improved legislation and a stronger regulatory authority will come in.Another thing you will have noted is our desire to educate the public about energy efficiency and conservation. We aren’t advocating only one approach, or only one solution, but rather a combination of many things, so whilst renewable energy technologies are part of the answer, conservation and efficiency also have a role to play.Just as most of us have a scale in our houses to weigh ourselves, we need to have some means of measuring how we are doing with regard to energy use.Modern metering technologies could help us enormously in the day-to-day use of energy, and real-time information is even better. If you understand immediately that turning on your air conditioning is going to have a price impact of a given amount, it would allow you to make a much more informed choice about whether and when you use it.Currently, we can go to the meter and have a look to see how quickly the kilowatts are being used, but the only indicator of our consumption is in our monthly bills, so improved information is one thing that more modern metering can deliver.Similarly, if you wanted to allow Belco to, say, turn off your water heaters while you were at work, just for the peak hours of the day until 4pm, then that electricity, which would have been heating water when no one was using it, could be better put to use helping air condition a large business avoiding the need for Belco to fire up another engine.These possibilities might exist in our future, and with more advances in appliances and metering technologies.You will note that we have not used the phrases of ‘smart grid’ or ‘smart metering’, because these are such broad terms.Our work in the coming months (and indeed years) will be on defining what Bermuda’s needs are for its distribution system, and what the needs are for our metering, through another process of industry and public consultations, in order that all stakeholder groups are adequately represented.We leave you with the thought that there is no one magic bullet for our energy woes at the moment. It will take great effort from many stakeholders to make a secure and sustainably affordable energy future possible.