Focus on Fuel

Focus on Fuel

CEO CHAT by Mark Gordon | Managing Editor

A national power company chief executive - whose livelihood depends on more energy usage - publicly supports power conservation.

At first glance, it might be hard to believe that Jim Rogers has testified before a U.S. Senate subcommittee on energy as well as the United Nations about what he says is one of humanity's most pressing challenges: Climate change, and by extension, reducing energy use.

After all, Rogers is chairman, president and chief executive of Charlotte, N.C.-based Duke Energy - a coal-burning power company in five states that had $15.1 billion in revenues last year.

Then again, Rogers first job after college in the mid 1960s was as a consumer advocate fighting against rate increases by power companies. Fast forward 40 years and Duke Energy, led by Rogers, is on the flip side of that debate, as the company recently asked North Carolina regulators to approve its first rate hike in 16 years.

It's a good thing Rogers says he's the type of chief executive that can thoroughly analyze two sides of an issue before making a decision.

Rogers, who has gained national media notoriety for his energy savings approach in recent months, including write-ups in Forbes, Newsweek and the New York Times, will tell his story in Sarasota, Nov. 7.

Rogers is scheduled as the closing keynote speaker for the Sarasota International Design Summit, a three-day conference presented by the Ringling College of Art and Design that focuses on how to combine elements of design with elements of business.

The focus of Rogers' presentation in Sarasota will be on his plan to create a more energy efficient economy, what he calls the save-a-watt approach. The focus of the program, which first has to be approved by state regulators in the company's markets, is that the company, and ultimately its customers, will be rewarded for saving watts through a series of energy efficiency programs.

This can be accomplished, Rogers says, by recognizing energy efficiency as the "fifth fuel," joining coal, nuclear, natural gas and renewable energy. And under the save-a-watt business model, Duke Energy will encourage its customers to use less energy through a series of "fifth fuel" generated programs, such as using fluorescent light bulbs and high-efficiency heating and cooling systems.

Duke Energy is asking state regulators that it then get a return on the energy costs its programs helped avoid, if and when its customers use less watts.

Rogers came up with the save-a-watt model after touring cities and towns in the five states his company serves, as well as in speaking nationwide with business and environmental leaders.

"After looking at the country to see what was going on, or specifically, what wasn't going on, I knew we had to do something more," Rogers says in an interview with the Review. "There has been a chronic underinvestment in energy investing in this country. We are going to have to step that up."

Rogers, 59, has been the chief executive at a electric utility for 19 years. Prior to Duke, he served in the top roles at Cinergy and PSI Energy. A lawyer, Rogers has also held jobs with a Washington D.C. law firm and was deputy general counsel for litigation and enforcement for the Federal Energy Regulatory Commission.

Here are some other excerpts from the interview with Rogers:

Q. What are the key points and challenges of the save-a-watt program?

A. The whole goal is to turn our focus to challenge us to use our imagination and creativity to help customers uses less energy. The problem is use of electricity is what the industry calls a 'back of mind experience.' So If I have $500 of disposable income, I'm not thinking about insulating my home.

My aspiration is that when you hit the switch that you are automatically going to use energy the most efficient way in your home. What we're proposing to do is to make [save-a-watt] a standard part of service, while maintaining your comfort and convenience.

Q. You were one of the first CEOs in the country to speak out on climate change regulations on a national level. Why is this important to you and how does it support Duke Energy's mission and its responsibilities to shareholders?

A. I've always said that to have a sustainable and successful business you have to run it based on all the needs of the all stakeholders. But you have a broader responsibility to the environment.

We have a very large environmental footprint, whether it's our power lines, transition lines or energy lines. We need to reduce that environmental footprint.

Q. How do you balance and explain the irony of taking a stance like this as the CEO of a power company, normally a top target for environmental activists?

A. I just have a fundamental belief that to be a good CEO I need to also be focused on decreasing our footprint. I believe it is part of my responsibility to address these issues. It takes decades to get this right and a significant investment.

Design Summit

to Focus on Service

The 2007 Sarasota International Design Summit is designed to be similar in focus to last year's inaugural event, which centered on how design - and lack thereof - impacts new product developments, sales and business models.

This year, in addition to Jim Rogers of Duke Energy talking about how his save-a-watt approach to energy efficiency fits into design, a highlight of the three-day conference will be on what's known as service design. Officials with the Ringling College of Art and Design, the hosts of the Summit, say service design is basically a way of thinking about what a potential customer wants before he even knows he wants it.

"Service designers," says Ringling College President Larry Thompson, "must consider how to create value within the systems that link people to people, people to products, and people to organizations."

In terms of service design, one of the key presentations of the summit is a panel discussion on how service design, in practice, is transforming public and private companies. 

Oliver King, founder of the UK-based service design consulting firm Engine and Beth Viner, with Palo Alto-based design firm IDEO, are scheduled to be part of that discussion. Viner is expected to talk about the work she and her firm has been doing to help businesses prepare for the next big potential customer base: Children born in the 1990s, a group being tagged as Millennials or Tweens.

The summit, with sessions held on the Ringling School campus and the Ritz Carlton, Sarasota, will also have sessions on baby boomer product design. Speakers are scheduled to include Constance Adams, a space architect with NASA's International Space Station and Mary Furlong, president and CEO of Mary Furlong & Associates, a firm specializing in marketing products to senior and baby boomers.

Information

The 2007 Sarasota International Design Summit runs from Nov. 5 through Nov 7. Go to www.sarasotadesignsummit.com. to register or for more information.

REVIEW SUMMARY

Industry. Energy

Who. Jim Rogers, Duke Energy

Key. Rogers is speaking at the Sarasota International Design Summit Nov 7., with a planned speech focusing on his company's energy-reducing business model.