Stan Connally is Executive Vice President of operations at Southern Company, one of the largest producers of energy in the United States. He also serves as Chairman, President and CEO of Southern Company Services. Recognizing that “most people don’t think of us until the bill arrives or the lights go out,” Connally addressed upfront the current rise in consumers’ electric bills, pointing to the higher costs of inputs.
“There’s some dynamics around natural gas prices and other commodities related to supply chain that are really leading to a lot of those pressures on prices and we’re all working incredibly hard to try to manage that. I’d like to give you some hope there. But as long as we have this conflict in Europe going on, I think there’s going to be some challenges to the supply chain fixing itself for some time,” he told Club members.
Meanwhile, he said, the focus remains on “building the future of energy and making it cleaner and more resilient.” Climate change has prompted policies to reduce carbon emissions at power plants. “Decarbonizing our electric generation business, frankly, has proved economic for our consumers,” Connally said. The Southern Company has transitioned its fleet and retired or converted 80% of its generating units in the past 15 years. Carbon emissions were reduced nearly 50% with a goal to get to net zero emissions by 2050. “Getting that last 10% to 20% is going to be the hard part. That’s where the new technologies have to evolve.” To get there, Southern is deploying more solar and storage technologies and is about to put online the first new nuclear units in a generation in Georgia.
“Electrification” is another way to build the future of energy, with electric vehicles leading the way. “Not since the invention of the air conditioner have we seen such a potential impact to the electric loads of our utilities as we do now with the growth of electric vehicles,” Connally said. To handle the projected 19 million electric vehicles on the road by 2030, he said that many more smaller generating installations will evolve from the traditional big central power stations that he ran earlier in his career. “It’s going to be far more distributed and that brings permitting and land use challenges that we’ll need to navigate. We as a country need to get more efficient at our permitting system, the United States at the federal level needs a lot of work,” he said.
Connally, a 34 year veteran of the industry, said the energy business “has gotten some recent wins” from Washington DC to help transition to that future. He said the recent federal Infrastructure Investment and Jobs Act will allow utilities and communities across the country to make greater investments in transmission and distribution networks, electric vehicle infrastructure, and provide more energy efficiency grants. He likewise applauded the federal Inflation Reduction Act which extended tax credits on renewable energy sources, nuclear energy development, and energy storage.
“Politically, energy should not be a partisan issue. Unfortunately, there’s way too much partisanship going on related to energy. Because at the end of the day, it is not a commodity, it is a necessity,” he told Club members.
The Southern Company’s operating companies provide electricity to 4.4 million customers in Georgia, Alabama, and Mississippi and natural gas service to 4.3 million customers in Georgia, Virginia, Tennessee, and Illinois. It also provides wholesale solar, wind, natural gas, and clean energy alternatives in 14 states across the country. Southern also operates a distributed energy infrastructure company, a fiber optics network, and telecommunications services.
Connally also talked with the Club about resiliency, cybersecurity challenges, training young talent, and “the need to connect to the customer and what they need most.”