Laura Sherman wants consumers to access all of the value that smart meters offer.
In 2015, Laura Sherman and her colleagues from Colorado Sen. Michael Bennet’s office rode horses into a special part of the Rocky Mountains called the Thompson Divide. Laura had landed in Sen. Bennet’s office after grad school as part of a policy fellowship with the American Academy for the Advancement of Science. At the time she was a legislative assistant to Sen. Bennet. She and her colleagues were working on legislation to protect federally-owned portions of the Divide from future energy and mineral extraction.
It was all part of a plan she made years earlier, while studying geochemistry at the University of Michigan. Laura realized that to influence climate policy, she needed to connect her research to policymakers.
Today, Laura continues to connect people and policy as president of the Michigan Energy Innovation Business Council, a trade association that’s advancing clean power in the state.
This week on With Great Power, Laura Sherman talks about the state of advanced metering infrastructure in Michigan, why she wants utilities to deploy next-generation smart meters, and the value the technology provides to Michiganders and consumers everywhere.
Credits: Hosted by Brad Langley. Produced by Mary Catherine O’Connor. Edited by Anne Bailey. Original music and engineering by Sean Marquand. Stephen Lacey is executive editor. The GridX production team includes Jenni Barber, Samantha McCabe, and Brad Langley.
Brad Langley: In 2015, Laura Sherman rode a horse into a special part of the Rocky Mountains.
Laura Sherman: An incredible wilderness area in Colorado called Thompson Divide.
Brad Langley: She was on a trip with colleagues from Colorado Senator Michael Bennet's office. It was one of those off-the-grid experiences you never forget, but it wasn't just about rest and relaxation. Laura had been working with the senator on legislation to protect federally owned portions of the divide from future energy and mineral extraction.
Laura Sherman: The Thompson Divide was also highly sought after for oil and gas. It's a wilderness area that, like a lot of Colorado, has really good mineral resources, and so it was under threat.
Brad Langley: But in 2024, after more than a decade of work, the team's efforts paid off. The Biden administration protected nearly a quarter million acres of the Thompson Divide from future oil and gas leases and mineral extraction until the year 2044. It was just one of many energy policy bills Laura worked on as a legislative assistant for Senator Bennet, and it was a long way from what she studied as a University of Michigan grad student back in 2007.
Laura Sherman: I was studying mercury pollution from sources like coal-fired power plants into the environment. And we were finding ways to basically fingerprint that mercury so we could trace it from different sources to different locations.
Brad Langley: It was wonky stuff, and it took a conversation with an EPA official who was on campus to talk about the agency's recent mercury and air toxic standards to make Laura realize that she had to connect what she was doing to the people being impacted.
Laura Sherman: So I told her about the project I'd recently completed in Florida where we could trace mercury from a coal-fired power plant right into rainfall in the local area. And she sort of looked at me and said, "Well, that would've been helpful to know."
Brad Langley: Now Laura had published the results of her research, but like so many other academic papers, it had fallen under the radar of any higher-ups at the EPA.
Laura Sherman: So it was just this moment of realization that if I want to make an impact with the science I'm doing, it can't just be a tagline in my paper that says this is relevant to policymakers. I have to figure out how to make that connection.
Brad Langley: So after grad school, Laura began figuring out that puzzle. She landed a fellowship with the American Association for the Advancement of Science, or AAAS. These fellows, many of them PhDs, work on policy issues, which is how Laura ended up in Senator Bennet's office.
Laura Sherman: The idea is that you're helping translate science for legislators, but what you're really doing is learning, and you're helping with a critical mind and with the excitement and curiosity to learn.
Brad Langley: Laura knew she wanted to work for someone in an energy-rich state. She planned to settle in the Midwest eventually, but first she wanted the challenge of working on clean energy policy out West.
Laura Sherman: Colorado has lots of different energy production, everything from renewables to coal to natural gas—they have it all. And I also wanted to work in a purple state so I could learn how to do that sort of political compromising and conversation about these issues.
Brad Langley: Six months into her fellowship, a legislative assistant position opened up in Senator Bennet's office and she took it. She remained there until 2017 when she headed back to Michigan to become a senior consultant with an energy policy shop called Five Lakes Energy. One of her clients was the Michigan Energy Innovation Business Council, or EIBC. And in 2019, she joined the council full-time as its president.
Laura Sherman: We try to advocate mostly in Michigan for policies that are going to help grow the clean energy industry, help create more jobs, help lower costs for customers, and ultimately address some of the big challenges in terms of climate change.
Brad Langley: These days, Laura says she has a trifecta of concerns: the science of climate change, the art of policymaking, and finding the right solutions for EIBC's 160 private sector members.
Laura Sherman: There are a lot of advocacy groups out there working on these types of problems, but there aren't a lot coming at it from the business perspective. And so we're really able to bring the voices of our members to these discussions and really inform policies with what businesses are actually doing. So we're not coming at this from a theoretical perspective. We're addressing these issues really with what's going to help companies and ultimately customers in a very tangible manner.
Brad Langley: This is With Great Power, a show about the people building the future grid. Today, I'm Brad Langley. Some people say utilities are slow to change. They don't innovate fast enough, and while it might not always seem like the most cutting-edge industry, there are lots of really smart people working really hard to make the grid cleaner, more reliable, and customer-centric. Today my guest is Laura Sherman, president of the Michigan Energy Innovation Business Council, or Michigan EIBC. We talk about the state of advanced metering infrastructure in Michigan, why EIBC wants utilities to deploy next-gen AMI devices, and the value that technology provides to Michiganders and consumers everywhere. But first I asked Laura to walk me through Michigan's energy landscape.
Laura Sherman: Most of the renewables already deployed are wind, but there's a growing amount of solar. Both of our large utilities, Consumers Energy and DTE Energy, have plans to be significantly reduced, if not fully net zero by 2040 or 2050. So Consumers plans to have roughly 8,000 megawatts of solar by 2040 in their latest renewable energy plan case. They propose an additional 2,500 megawatts of wind. That case is still pending, but it's quite a big investment. And then DTE has roughly 4,500 megawatts of solar and a thousand megawatts of wind by 2032. Both of them are procuring energy storage with the state, setting a mandate both for renewables and storage in 2023, which is really aligned with where the utilities already are, but ensuring that we have 50% renewable by 2030 and 60% by 2035.
Brad Langley: One of your main focuses right now at EIBC is next-gen AMI, which is obviously an important topic. I'm curious, why do you consider next-gen AMI such an important technology right now?
Laura Sherman: One of the main reasons is that the first round of AMI that's been rolled out—and it's roughly over the last 15 years, utilities across the country have rolled out about 120 million smart meters—most of those are sort of what I'll call AMI 1.0. So not this next generation. In Michigan that's the same. I think roughly 95% of residential customers now have smart meters, this AMI 1.0. There was a lot of promises with those smart meters for customer benefits, things like reduced energy use, bill savings, ability to better monitor their energy use, potentially the ability to integrate things like smart appliances. It hasn't really happened. And I think some of that is the planning and the other programs that need to be in place. And some of that is simply the technology wasn't capable of that. Those older meters are very capable of doing things like reducing meter reads, reducing the amount of time they have to spend sending somebody out to figure out why they're getting a weird reading on a meter because they have access to those data.
But it hasn't done a good job of providing customer benefits. So I think that's the first thing with AMI 2.0 or next-generation AMI—it's really planning ahead to get those customer benefits, reducing customer bills, allowing customers to benefit when they're providing grid services, like demand response services to the grid or even providing generation back from storage or a solar array. And then the second thing is addressing the new loads that are coming on across the country. So some of that is electrification, buildings and vehicles being electrified, but that's slow and steady growth, whereas the data centers that we're seeing everywhere—and I think both Consumers and DTE have announced that they have serious data center customers—that's going to in theory happen really quickly. These data centers can be built really quickly and they require 24/7 power, hypothetically really high power quality. And we can't necessarily build things—we definitely can't build fossil fuel resources or nuclear resources. Maybe we can build wind, solar and batteries at that speed, but we could also better take advantage of what already exists at our homes and businesses, what people have already invested in, if we have the right technology at the meter and the right program in place to incentivize people to provide the power or reduce their load when we need it.
Brad Langley: So what's going to need to happen to upgrade existing AMI deployments in Michigan?
Laura Sherman: I think first, one of the things the commission has been really pushing for a while is we need better long-term planning of the use cases. So we need to better understand how the investments that customers are actually making—because these are ratepayer investments—are going to then benefit customers. And I think that's a connection that is simple to say in theory, but it was a promise that was made with the first generation and it didn't bear out. And so I think we really need to dig in on what are the specific things we want the meters to do, and then which types of technology can provide that? How do we ensure they're not going to get obsolete in 10 years? Again, we need technology that can kind of be upgraded remotely, and then we need to plan ahead for that in terms of creating those programs so that when we have all of the technology deployed, we can make use of it.
So the commission in Michigan is actually starting this hopefully soon. They ordered in a recent case that they're going to have an AMI technical conference in the coming weeks—I'm not sure when yet, it hasn't been noticed yet—but we hope that that'll be sort of a first step to bringing folks together, bringing in experts from out of state. Some other states are thinking this through too, especially ones who maybe didn't make as many investments in the early AMI. Now they've got an opportunity to sort of jump ahead and go to just AMI 2.0, whereas we have to make sure that we're making smart investments because the meters we have now aren't yet obsolete in terms of their lifetime, but they are obsolete in terms of these use cases that we might want to take advantage of.
Brad Langley: Is it fair to say this is going to require new regulations, and if so, what would those regulations look like?
Laura Sherman: I don't know if we need new regulations, but more new regulatory oversight and pushing the utilities—I think to do this planning, not to simply make the investments in the next generation of AMI before you have the full business case and use case laid out, and before you can really spell out how we're going to use this to benefit... How are we going to connect these meters with, for example, a utility DER management system? How is this going to fit in with the existing demand response programs? What kind of virtual power plant programs are we going to create? And so laying all of that out I think is less of a need for strict regulation and more of a need for the commission to continue to push the utilities and sort of require these types of long-term planning before you make the investment.
Brad Langley: You recently wrote an op-ed on this topic, and you said that the two utilities, the major utilities in Michigan, Consumers Energy and DTE, had submitted comments to the state's Public Service Commission that called establishing performance incentives related to AMI deployments premature. What are their specific arguments?
Laura Sherman: I think that broadly their comments were that we should focus on things like outages and service quality and that those were the types of things that were more ripe for performance incentive mechanisms rather than AMI. And my thought is these are one and the same—AMI should be useful for outage detection. I think AMI, especially AMI 2.0, can be, and I think there are definitely things like time-of-use rates that can be better rolled out with AMI. And those are sort of core utility pieces that they are working on for all customers in Michigan right now. I think there's a hesitancy from utilities when you talk about performance incentives because it always comes with penalties. And so there's sort of an ideal performance mechanism that has a positive side and a neutral side and a negative side. And I think for some of these things that the utilities are not ready for, they think there should only be an incentive. And I think if we're going to set a good customer-serving policy, we need a balanced mechanism.
Brad Langley: So maybe widening the lens a little bit, what do you think it will take for utilities, whether in Michigan or across the country, to embrace next-gen AMI and start doing this longer-term smart meter planning that you're advocating?
Laura Sherman: I think part of it is looking at the benefits both to the utility and to the customers. In many cases, there are really strong benefits to the utility. I mean, not only the simple things they've already accomplished, like improvements in cost and meter reads and stuff like that, but also the ability to provide peak power when you need it, the ability to reduce demand more quickly when you need it. I mean, I think the outage piece is huge. The ability to do outage detection or outage prediction—you can detect these things so much more quickly and accurately with next-generation meters. So I think part of it is the utility doing that full assessment. Utilities are risk averse. I think having groups like EPRI assess it and determine the benefits and how it's actually working—they don't want them to make investments in things that are not going to work or that are going to become obsolete. And so I think some of this will come with that sort of experience. I really think if the utility is able to look at the full benefits and the regulators are able to push them to look at the full benefits, I'm hopeful that we can kind of move the conversation along.
Brad Langley: There are states and utilities that are currently doing pilot deployments and doing this testing. Are there any that kind of jump to mind as doing a good job with this approach that maybe others can look to for an example of how it can be done?
Laura Sherman: I think this might be an example of a state that sort of didn't do AMI 1.0 but is now able to jump to 2.0—that's New York. The New York PSC approved use of one of these next-gen meters recently. And I've had it explained to me that it's roughly like having a mini computer at your meter, whereas maybe what we have now in Michigan is we have maybe a flip phone and what they're putting out is an iPhone. So they've got the ability to put apps on it, which can interact with the customer and the utility. I know that National Grid is also deploying a lot of next-generation meters and they have a—I think that's probably across their entire northeast footprint.
Brad Langley: EIBC has also drafted a bill that would set up virtual power plants in the state, which is exciting. What would the bill change or require that doesn't exist today?
Laura Sherman: Yeah, so we're hoping to get this bill introduced in the next little bit here, but it would first require the commission to set up a template, basically a template program for the utilities that looks at all the potential benefits that customer devices could provide through a virtual power plant. So this is rooftop solar, storage, demand response, electric vehicles if they're vehicle-to-grid enabled, looking at all the benefits that could be provided. So peak load reduction or ancillary services or capacity, whatever is needed. And set up a model program for how the utility would signal—it's likely through a DER management system—either to smart meters or to some kind of a grid edge system and to aggregators. And those aggregators would then basically put the whole neighborhood on this program so that they have 10 megawatts. And then when the utility sends a signal and says, "Hey, we need five megawatts," they've got it because they've got all these people who have batteries in this area. So the commission would basically set up this template program and then the utilities in their next rate cases would have to file programs that complied. So it's a multi-step process. The first one could be just simply focused on peak load reduction and demand response devices. It could be fairly simple in the beginning. And the main thing is to allow utilities to work with third-party aggregators who work with customers to gather all of their resources and then use them when they're needed.
Brad Langley: And so you've been very focused on—you've got to quantify the benefits to both the utilities and the customers. So what do you see as the benefits of VPPs to customers?
Laura Sherman: So if they are using a device that can basically change load in time, which would be demand response, then they can reduce their bill probably through use of time-of-use rates and those kinds of utility incentives that already exist. So you can make better use of the existing system through this because it'll be a dual signal probably at the same time that you're already incentivized to shift load. If you don't care when your electric vehicle charges, as long as it's charged by the morning, you don't really care if the utility shifts the charging from right when you get home to midnight. And you can set that. If you take a shower, you just want the water to be hot, but you don't care if the water heater turns on the minute you stop—it can happen later as long as somebody else doesn't have to take a shower.
So those kinds of things can reduce customer bills. And then I think the other thing is if the utility needs the value that can be provided by the customer and it can be provided—this is where it ties back into data centers—quickly, very quickly. If we can stand up these programs that already exist, so we can provide it instantly to reduce load or provide energy or capacity when we need it, the customer would then be—it's called pay for performance. So the customer would then get a credit for whatever they actually provided. And there's lower risk with use of an aggregator because the aggregator is signing up much more than they need because they know everybody's not going to respond. Somebody might see the notification pop up on their phone that says, "Hey, we're going to have an event in an hour. Can we reduce your whatever?" And they say, "No, I need that thing." And they cancel it. Okay, that's fine. I signed up twice as many people or devices as I needed, and so half of them are going to be like, "Sure, I don't care. I'll get the $2 credit. That's great."
Brad Langley: No doubt. Last question for you. We call this show With Great Power, which is a nod to the energy industry. It's also a famous Spider-Man quote, "With great power comes great responsibility." So what superpower do you bring to the energy transition?
Laura Sherman: That's a great question. I'd have to say unending curiosity. It's why I love this job. I get to meet new people in the clean energy industry and I just get to ask them questions and learn from them. My power comes from our members. My power comes from all the businesses that are willing to talk to me and tell me how they do their work, how they work with utilities, what the latest technology is. That's sort of what I love doing, and I think I learn a lot and then I'm able to turn that into advocacy that benefits the industry.
Brad Langley: Well, Laura, it's great talking with you. Really appreciate your time today.
Laura Sherman: Good to talk to you too.
Brad Langley: Laura Sherman is president of the Michigan Energy Innovation Business Council. With Great Power is produced by GridX in partnership with Latitude Studios. Delivering on our clean energy future is complex. GridX exists to simplify the journey. GridX is the enterprise rate platform that modern utilities rely on to usher in our clean energy future. We design and implement emerging rate structures and we increase consumer investment in clean energy all while managing the complex billing needs of a distributed grid. Mary Catherine O'Connor produced the show. Anne Bailey is our senior editor. Stephen Lacey is our executive editor. Sean Marquand composed the original theme song and mixed the show. The GridX production team includes Jenni Barber, Samantha McCabe, and me, Brad Langley.
If this show is providing value for you, and we really hope it is, we'd love it if you could help us spread the word. You can rate and review us on Apple and Spotify, or you can share a link with a friend, colleague, or the energy nerd in your life. As always, thanks for listening. I'm Brad Langley.