Episode 136: FortisAlberta and the rapidly changing distribution business, with Janine Sullivan

[MUSIC] Customers are now no longer just consumers. They're actually prosumers. >> Right. >> They're actually generating and managing their own power. >> Yeah. >> So we've got a lot of really new emerging requirements of the system that are coming from our customers. They want to have more control over what they use when they use it and how they manage the cost of it. [MUSIC] >> Francis here from the electricity Canada. Welcome to another episode of the flux capacitor. A podcast about the future of electricity. This is number 136 episode 136 of the flux capacitor. I've been chatting with the industry's business leaders, thought leaders, new market players, and stakeholders. I build this as an opportunity for you, the listener, to get a sense of the conversations that are taking place in the sector. In hallways over coffee, outside of parliamentary committees, in airport lounges, and at industry events. My guest on the podcast today is. Janine Sullivan, president and CEO for Salberta. >> Janine joined me for a chat about the challenges and opportunities faced by Fordous Alberta. We talk about the impact of electrification, including the rise of electric vehicles and rooftop solar, and the need for strategic investments to meet growing demand. Janine emphasizes the importance of leveraging technology and pilot projects to innovate cost effectively. We also talk about the challenges of managing wildfire risks and the critical role of partnerships with local communities and government agencies in supporting economic growth and infrastructure development. We close the conversation with a great book recommendation. Here is my conversation with Janine Sullivan, recorded on Zoom in April 2026. Janine, welcome to the podcast. I'm really looking forward to having a chat about Fordous Alberta. >> Excellent. I've never done one of these, by the way. You're my first. >> Wow. Okay. Well, that's awesome. >> I know. >> As I noted, this is number 136 for me, so I've done a few of them. >> I know. I'm feeling a little disadvantaged here. >> I'm so sorry. But listen, I think it'll be fun to have a chat about Fordous Alberta, about what's taking place in the market in Alberta, and what's the place of Fordous Alberta in that value proposition to the customer because this is a lot happening. I feel sometimes like I spend a lot of time talking about generation and transmission on the podcast, so this gives us an opportunity to shift that. But maybe before we get into some of the details, just for the listener, maybe a quick thumbnail sketch of Fordous Alberta as a company and where it fits. >> Yeah. We serve over 60% of the distribution system in Alberta. We serve outside the major urban centers, so we are rural or urban rural. We call ourselves in some of our more large or smaller communities. So certainly, the central and southern part of the province, but a very large geographic footprint. We have 1.1 million poles and 131,000 kilometers of wind. So a lot of infrastructure covering a large part of the province. And I'm really, really proud to serve that part of the province because there are a lot of very exciting things happening outside of the major urban centers. And that's one of the things I hope we get to talk about today is when we talk about economic growth and development, we don't need to just focus on the large centers that traditionally attract that. There's a lot of very exciting things happening in some of the more rural and remote communities that are utility serve. >> So you have twice as many poles as customers. >> Yeah, I guess that's about right. >> Wow, okay. I think this is the first time I've spoken to the head of a company who has double the number of poles as customers. But I think that kind of places context around the vast territory that the company is covering off. So let's jump into this because this is an opportunity to talk about distribution and with you, the largest distribution company in Alberta. And to get some perspectives, both the distribution perspectives, but also, as you said, you've got an interesting mix in terms of what your customer base looks like. We're seeing electrification taking place in Alberta, across Canada, businesses, transportation, making investments in things like electric vehicles. We're seeing rooftop solar, we're seeing heat pumps being picked up. But be interested to kind of get your perspective about, what does this look like for the distribution system, where so much of what we're talking about here is going to land in the distribution system. It's going to impact how you're able to kind of manage and build the system for the future. So with all of these investments and electrification taking place, what does that going to mean for for for for to sell for to sell for to. >> Yeah, so I mean, distributions where electrification and load growth first shows up. And we're seeing growing levels of housing starts and new customer connections. And that growing number of customers, each of them is using more electricity than the customer before. As you've shared, they're using heat pumps, they're driving EVs, they're installing rooftop solar. So our customers are actually driving the pace of electrification at a rate that we haven't seen before. And we are looked to them to provide the service to support that activity. So we're actually responding to I guess a bit of a customer signal as to the things that they want to use and how they want to use them. Those increasing volumes and expectations are imposing some requirements on us. And it's really important that we are very thoughtful about how we respond to it because of the concerns about affordability primarily and making sure that the system grows and adapts in the right way. And the conversations that we have internally, and I have with my board honestly, is we think it's incumbent upon us to make sure that we extract all the opportunities there is out of what already exists in terms of what's already been invested in the system. So we want to optimize the investments that have been made to date, extract all the value that we can from that to respond to those increasing needs. And that really means using technology, right? How do we use technology to tap into what currently exists in the system, extract the value from it, and respond to those needs first before we start to talk about new investments. That's where everyone gets a little, a little anxious these days is just how much investments require. What types of investments? Who's going to pay for them over what period can they be recovered? And so we need to be really, really careful about managing the timing and the amount of new investment to respond to this new customer expectation not to get over our skis. It's a real difficult balancing act. The other thing I would suggest that comes from all of this is that our customers are introducing DERs or distributed energy resources of different kinds on the system. So when you look at things like rooftop solar or EVs, these are all different forms of DERs. That the system was never really built to interact with. They create two power issues, power flow issues, power quality issues. And on top of that, customers are now no longer just consumers. Right. They're actually generating and managing their own power. So we've got a lot of really new emerging requirements of the system that are coming from our customers. But they're using more of it. So how do we make sure as that front facing customer entity, how we interact with them and respond to that in a very prudent and cost effective way? So you mentioned the prosumer. So for you, this isn't something theoretical on the horizon. This is the world of Fordous Alberta today. Right. Right. This is happening real time. And I think that the pace of which is happening and the way at which the requests are getting more complex is happening in a way we haven't seen before. So when Ford first came into Alberta 2004, really the first decade, decade and half was really about responding to growth in the province. Right? It's stalling new services, putting poles in the ground, catching wires, transformers, meters, traditional investments. You know, the rate at which that happened, you know, kind of came, came pace with what was happening in the economy, what government priorities there were, but it was really more traditional investments. I would say that since 2020 over the last five, seven years, we've seen different types of growth happening. And that has been triggered by electrification, whether it's people responding to their concerns around climate change or just the need to use electricity in new ways in different ways. We are definitely seeing more growth and different types of growth in terms of the things that customers want us to do versus what we've traditionally seen. Yeah, so what is that now translating into in terms of well, you know, opportunities for growth certainly for the system. But yeah, maybe I'd like to kind of get your views on both the growth of the system and how you kind of mentioned a little bit about this so that that delicate balancing act, right? But and rapid change and you mentioned technology and rapid change. So that sounds like you're not balancing two things here. You're balancing at least three things and maybe even more. Well, it's really interesting because you know, recently I was talking to our employees at our leaders forum. And we we talk about our core, right? What is our core business? Right. And traditionally that has been our polls and wires. But, you know, we we talked about how the definition of our core is actually changing as we interconnect different types of load. Yeah. As we respond to the ERs, as we adopt new technologies, you know, really our core is actually changing and evolving. And as that happens, we've had to adjust as well. So, for example, in our engineering group now we have a power system engineering function. So you wouldn't normally think of the distribution grid as a power system, but it is exactly that right now. We're employing data scientists. So understanding the data that we have and how we can leverage it to understand where technologies can best serve us. So definitely thinking about the grid in very different ways versus a one way power flow of electrons flowing through a conductor going to a meter into a home or into a business or into a farm, definitely now a much more complex power system than we traditionally would have thought about the distribution grid. Yeah. It sounds like, you know, you mentioned there's some some different skills now that you didn't require a generation ago. That's probably going to continue to change. Absolutely. Yeah. Strategic workforce planning is certainly top of mind for us in terms of understanding how we leverage the greatest expertise that we've built over time. Then how do we build on those skill sets to meet these emerging needs. And you do have to go outside the organization sometimes to supplement that, bring in different types of talent like I've referred to data scientists. Yeah. You know, we have these power system engineers with PhDs now that are supporting our frontline field employees, our customers, service representatives who are encountering these conversations with customers and then bring them internally looking for technical expertise and then translating those into solutions that we can deliver for customers. So it's a really interesting dynamic that we have now where we actually have internal advisory services going outbound to our customers as these are very new conversations that we're not used to having. So it's really challenged us though to think about our processes for working with customers, right? So how do those first conversations happen? How do we come to understand the requests that they're bringing to us? Reflect on them internally, understand what the the new standard might need to be or what the design might need to adjust for and then communicating back customers who are learning with us how we actually deliver that service for them in a very non-traditional way. So it's really fun. I like to think of us as a bit of a learning hospital or a teaching hospital now we're a teaching utility. Yeah. We're learning as we go and learning with our customers. But you know, as you learn, you need things to keep pace around you. So I am sure one of the things we're going to talk about today is the pace of which those things translate into policy and the rate making. Yeah. Because there's definitely, I used to think of it as the trifecta between the utility, government, and the regulator, but it's really more of a force, a four-part relationship because we have our customers initiating this conversation. Yes. Coming to us, saying this is what we want to do. Yeah. We digest that and we can we can share with them what we're able to do and what we're not currently able to do. What our tariff currently doesn't consider. Yeah. Like battery storage, DSM, things like that. And then that gives us a platform to talk to government about what Albertans, what are customers need from us. And we can kind we try to approach that conversation as a trusted advisor. Right. This is not me as an investor on utility coming to you. This is me as a customer representative coming to you and saying this is what our customers are expecting from us. This is the economic growth that we can trigger if we provide a grid with these capabilities. Right. Let us educate you as well about what we're able to do. What we could provide. Yeah. And we have those conversations. And if we can get to a point with government where we've confirmed public interest, there's no harm. There's a public interest element here. Then our regulator can rely on that and point to it when they're considering the related investments. Right. And I think I think that's where we need to get where. But they need that policy signal, right? They do. That signal from from government where we've collaborated and we've worked to bridge gaps between what what the economy might need. What opportunities there are. What are customers are asking for. With the right way to go about it, prudent, very thoughtful, that balancing act I refer to. How we can do it collectively. And then once we've established that, I think it's a it helps the regulator in a way that you know sometimes we talk about being frustrated with our rate making, not keeping pace with what we need to invest. I think we need to be a little practical about setting the right stage for that these days. Even the amount of investment we're all talking about whether it's transmission, generation, or distribution. Being sure that we're going about it in the most the most thoughtful way. Right. And we accept that responsibility. And I think that if those conversations are had and they're had properly, then I think we can get their eye often say to government, I don't even need to be in the room. Listen to the people who work for us. Experts that that we have thinking about these things day in day out, having the conversations with our customers, they'll tell you what's really happening and how to best respond to it. And then you can be sure that the policies that you identify are in their interest then that the regulator can be positioned to a pawn on how they should be best rolled out. Yeah. Yeah. Yeah. And I want to follow up on a couple of those because if you've raised quite a few really interesting points and I do want to talk policy. But before that, there's a question that I ask everybody who comes on the podcast and that is about your journey. So a bit of attention here to get a sense of what what your journey was to your role and make the same joke on every podcast. Janine, when you were a little kid on the playground, did you always dream of running a, the second, there was the largest distribution company in Alberta. What was your journey to your role at Fortis Alberta? Yeah, you never really start out thinking this is where you're a land. I'm I'm really happy that this is where I land. I love what I do and it's great to be able to shape a service for a province in the way that we do at Fortis Alberta. Next year marks 30 years with a Fortis group of companies for me. I'm, I guess I'm actually aging myself by saying that. Wow. But I essentially grew up in the electricity sector. So, you know, by trade, I'm a CACPA. So, you know, went to a digital business school and the CA program. And really focused on the regulatory and finance side of the industry. But being a part of fully regulated investor own utilities, you definitely learn the business through the regulated form. And you know, whether it's facilitating rate cases or participating as a witness, you definitely get in behind the technical side of the business to a test to those applications. So it really created, and I don't know if people who come up through different disciplines appreciate that, you know, that environment is really a great learning space. Even if you don't come from the engineering or field side of the business, you definitely get immersed into a lot of, a lot of those areas coming up through that part of the business. So, you know, definitely over the first 20, 25 years of my career, you know, spending a lot of time learning through the regulatory form, definitely, I think, hopefully prepared me well to step into this role. You know, Fordists does tend to grow its senior executives internally, and spend long careers with Fordists and learn the industry over decades. And it seems to position us very well to step into the CEO role. And for me, it came at a very interesting time in that I was appointed during COVID. So, you know, very quickly immersed into some very challenging issues, whether it was vaccination policies or remote work policies or supply chain challenges. We went through, as you know, in this province, a double black swan with COVID and gas and oil and gas industry pricing. So, certainly a very challenging first couple of years, but have really enjoyed navigating the, and I guess the opportunities that this province and that this industry is now exposed to. And then seeing it being talked about at a national level, right? When electricity becomes a national topic, as we know electricity, Canada, and it's getting more airtime than ever before. And spending in this province where you know, you know, we're a fossil fuel-based economy, but electricity is actually becoming more of an energy discussion now. And so really pleased to be in this role and be able to be a part of those discussions, because I think we could be a really important partner in terms of unlocking the opportunities that I think as a nation and as a province, we're very focused on particularly right now. Well, then let's talk about one of those opportunities that we're hearing a lot about. Everybody's talking about and writing about AI and data centers and the rise of data centers coming into the market. How is this impacting your company? So, you know what, there's great opportunities for data center growth in Alberta. And we've seen a lot of it talked about in the province. And even at the distribution level, we are seeing a lot of activity, a lot of conversations about data centers with, within our service area. Data center customers are fundamentally different. They don't respond to price signals in our tariff, the same as other customers do. They have an outsized impact on installed capacity and available supply, very interesting service requirements. And they certainly approach their projects with the level of urgency that we don't see with other other customers. Their timelines are extremely, extremely tight. And they have very, very high requirements for certainty around their service and reliability. So very, very complex, fundamentally different customers for us. The investments that they trigger in order to meet those requirements, they do raise questions around cost accountability. They trigger investments that are different in that, they're the timelines over which they might be recovered. The timelines over which they might provide that service are much more compressed compared to, you know, decade-long traditional utility investments. Right? They have unique tariff implications that we need to discuss with our regulator. And we really do need to consider the impact that they'll have on the broader customer base in terms of the costs that come with them. And there's been, there was an article recently in the Calgary Herald talking about this balancing act between attracting them. And the investments that they require and the costs associated with those investments and making sure that we think through how we are responsive to those, those potential customers. We want to attract them, but we want to make sure that the investments that are made and how they come on to the system and interconnect to the system is done really thoughtfully so that we understand the timeline over which the investments are recovered and who we are recovering them them from. They're new, they're big, they're testing the system as we learn how the system can respond. So as the customer facing, facing entity, we're certainly working with them, but we're also connecting them them with the ISO and with our counterpart transmission level to understand their needs, what the system has the capability and capacity to deliver. And then how we might respond to their requirements over time under the right tariff mechanisms. Very complex. It is, it is. And I think you see that across North America where there's been a lot of discussion, but also a lot of contemplation about how those investments are going to happen. So it's been race to the finish, but at the same time, slow finish. Yeah. Okay. You talked to a couple of minutes ago about policy and how policy kind of interacts with regulation. So you know, that that raises, I think the question really of, you know, what the role of the provincial government is in all of this, because, you know, as you said, in just overall supporting the system. But particularly in a period of time when we're going to see more and more innovation, supporting innovation. That isn't necessarily the mandate of your regulator. So how do you make sure that you're getting those policy signals from government and how critical is it that we get them kind of in a timely manner. I'd say one of the best tools that we've had of late in terms of innovation is the use of pilots. So because distribution utilities, we traditionally, honestly, Francis, haven't done a whole lot of R&D. You wouldn't, you wouldn't think of distribution utilities with polls and wires, meters and transformers as, you know, really having a lot of R&D. And traditional ratemaking doesn't really incentivize R&D or innovation. So what we found, because we know it's important to response to the affordability conversation. It's to know how we apply things like AI and how we innovate our processes to be cost effective and deliver the best value we can for customers. So we've been using pilot projects to demonstrate how innovation can apply. So that allows us to take a concept and apply it in a very manageable scale to learn and understand how it can be applied and then use that as a conversation piece with government. So we can say, you know, when it comes to micro grids or virtual power plants or other approaches to managing the grid. We've we've tried it on a small, small scale. We now know how it can work and how it can be applied. And we can propose an approach to investing in it in a very thoughtful way. On a greater scale without exposing customers in an unknown way. So by doing our pilots, we gain credibility as a bit of an expert. We can show that we have the learnings to back up our research. And then we can demonstrate prudency in terms of investing further on a greater scale. But we haven't put customers at risk through that process. And I think that's a really balanced way to go about having conversations about innovation. And then we're prepared to take off the training wheels when all parties agree that it's the right way to proceed. Yeah. Yeah. Well, one area that I know we've been looking as a sector. at innovative approaches, and specifically in Alberta. I'm just back, actually, I was out your way this week for a wildfire workshop. It is wildfires, and wildfire season is now once again, upon us, interested to kind of get your perspectives in terms of, you know, what are the sorts of things that that Bortis helpers is doing to prepare for this wildfire season, and, you know, your approach overall. - It is interesting the conversation about wildfire mitigation and then the programs, and I guess the socialization of what utilities like Bortis helpers do, because we've always done wildfire mitigation, and especially if Bortis helpers because we, the types of service area that we have, highly forested, central and southern Alberta with often very hot and dry climate in a lot of our service areas. So we've often, we've always done a wildfire mitigation, but certainly, you know, our conversation with stakeholders about what we do has grown, because the volume of wildfires and their impacts has also grown in recent years. And so we certainly have been communicating more about it. It's certainly a risk-based approach. So we do focus on high-risk fire areas. We do focus on strengthening infrastructure in those high-risk fire areas. Spend a lot of work and spend a lot of time managing vegetation. We do adjust our operational practices when conditions are considered high-risk. So at certain times during the year, we certainly adjust what we do. So we kind of capture that as situational awareness. Spend a lot of time understanding what's happening in with respect to weather forecasts and what the conditions might be in our service area and how we might need to adjust at any time to what we're doing. We've certainly onboarded a number of new technologies as well as expertise that help us predict and prepare for high-risk conditions. So certainly bring in internally people who can help us forecast weather conditions and who are specialists in wildfire management practices and using technologies that help us understand when conditions might be more prone to wildfire. So now I get updates regularly with the snapshots of conditions, whether it's precipitation or forecasted temperatures that might lead us to be more aware and mobilize our operational practices differently over the coming days, for example. We did roll out our public safety, power safety program, public safety, power shut off program. Sorry, PSPS. PSPS? We're at a game, see if you capture a problem. Public Safety Power Shutoff Program PSPS, which has grown and profile as an industry conversation. It is considered a last resort option. We would only use it in very extreme rare situations, but it has become seen as a necessary option for utilities to have to prevent large scale destruction of infrastructure in communities. The roll out of PSPS does highlight the need to work closely though with stakeholders. So in order to have something like a public safety power shutoff program, you need to be really closely aligned with the communities that it might impact. They need to know how and when that decision might be made, what we're doing to work with them, how they need to prepare. We need the government to be aligned with us in terms of the need for such a program, emergency responders need to be educated as to how they might operate with us during a high risk situation like that. So a lot of community engagement, a lot of education, and a lot of preparedness has gone into a program like that. Yeah, well, yeah, as I said, I spent time this week specifically on this file. But you know, one of the other things that you've mentioned there in your answer was, you know, you talked about partnerships and how important partnerships are on this file. But I mean, when you take the full sweep of activities and the changes that are taking place in your business at Fortis, Alberta, maybe talk just a little bit about the critical partnerships that you see, you know, who are the critical partners that you need to be working with in order to manage growth as your system is evolving. Certainly partnerships and outbound engagement has certainly become a priority for us recent years. We are certainly looking at engaging on all topics. I'll start with Wall Fire because the one thing I'd like to refer to is the Alberta Wall Fire Coalition that we formed with Alton Linken-ACCO to demonstrate and industry commitment to Wall Fire mitigation, to acknowledge the risk and to demonstrate our best practices to manage it. And I think that was a really important signal for us as a utility coalition to demonstrate all stakeholders that were committed to it. And then even within the Fortis group, we sent some of our internal employees to a Wall Fire symposium in Newfoundland last week to share just how much the Fortis group of companies has done and the expertise that we've developed, the knowledge around the technologies that are out there and the operational prices that can be applied. I'm really proud of the work that we're doing and that we can share it not just within the Fortis group of companies, but broadly. When it comes to Wall Fire too, even working with the federal government and parks Canada and understanding how we can better serve the parks to comply with their requirements in terms of protecting park property and so on, therefore, people to enjoy endangered species, things like that. But we do need to get in there and do some of these practices, these best practices to make sure that the infrastructure is best prepared for high risk times for parks as well. So we've been talking about that partnership and making sure that we're aligned, working with the federal government and provincial government too in terms of funding opportunities for innovation. And that's what I referred to earlier in terms of understanding how we can tap into opportunities to avail of those opportunities without compromising our customers and what they need to pay for. Also, our local communities, partnering with them. So when we talk about economic growth, communities that we serve, the councils that I meet with have very impressive strategic mandates. They're operating almost like small corporations, the types of things that they want to deliver for their communities. So we're really pleased to partner with them because they need the grid in their community. They need to leverage our grid to tap into those economic opportunities. They want the next big project to land in their community to trigger other economic growth and new jobs. And so we're often first to this table with them to show how they-- we're there to work with them to facilitate the interconnection of those projects and make sure they get done. So those types of partnerships have been really important for us too. And finally, we do a lot of community-based partnerships. So we want to make sure that we are there to support communities not just to deliver electricity when they need it, but also to support needs in the community. So we do a lot of community investment, a lot of volunteer, making sure that we're supporting the causes that we-- to make sure that we show up that we live and work in the communities that we serve. Janine, you've been-- I have a ton of other questions. But I think we're running at a time. You've been very generous with your time. But nobody gets off the podcast without giving me a book recommendation. And we put them all together in our Flux capacitor book club. So today, what book would you recommend that we add to our reading list? So one of the books I read very recently was called "Finding Flora." And it is a book that explores the early pioneer years in Western Canada in Alberta, very specifically in some of the communities that we serve, how they were originally explored and settled, and uniquely through the perspective of some women pioneers. OK. So very unusual circumstances found themselves coming over from Scotland, landing in Alberta, and then settling homesteads as women. And their experiences and some of which were unique to them being women, but then also allowing me to learn more of the history of this province haven't come from Newfoundland 20 years now ago. But now seeing this as my home, learning more about the history but from the unique perspectives of these women pioneers. So a very interesting read that I want to share. All right. Well, I just-- on my other screen here, I called it up. And so it is called Finding Flora. And it's by Eleanor Florence. Yes. And it's, they say it's a relicking historical novel setting in turn of century Alberta. Yes. Fantastic. That is a terrific addition to our reading list. And I look forward to reading it myself. Excellent. Thank you. Jenny, thank you very much. I really appreciate you taking the time to join the podcast. It was a fascinating chat. Perfect. Thanks very much, Francis. For those that have been with the podcast since the beginning and those that have joined along the way, thanks for listening. Please take the time to rate the podcast on whatever platform you use to listen. And let me know what you think of the flux capacitor. You can find me on Instagram as the Brad Bradley, on LinkedIn and through our website at electricity.ca. The website for this pod is the flux capacitor.ca. And it includes links for this episode on the show page, this being episode 136. And while you're there, check out the book Club page, which provides info on and links to the books which have been recommended by guests on the flux capacitor, including Janine's recommendation, Finding Flora, by Eleanor Florence. And let's continue the electricity conversation on our Facebook page on Instagram and at electricity.ca. [MUSIC PLAYING]