Q&A with Shawn Schukar, chairman and president, Ameren Transmission Co.
EDITOR’S NOTE: Shawn Schukar, a 32-year veteran of Ameren, was promoted in May to chairman and president of Ameren Transmission Co., a subsidiary dedicated to electric transmission infrastructure investment and expansion in Illinois and Missouri. The transmission system includes more than 7,800 circuit miles of high-voltage transmission lines in the two states. Schukar lives with his wife in Collinsville.
IBJ: You’re new to your role, but you’re certainly not new to the challenges of the electric utility industry. How have the first few months played out?
Schukar: Very well. We’ve got a great team in transmission and they continue to deploy on the focus of the group, which is looking at safe and reliable service for the next 100 years. We’ve been around over 100 years, and we’re looking to see how we continue to build and maintain the system in a way that manages the reliability, cost and value to the customer. The team does a great job of continuing to deliver.
IBJ: Between 2007 and 2011, the company invested approximately $345 million into the transmission system. What kind of money is being spent now, and what’s it being on?
Schukar: We’re investing hundreds of millions of dollars on an annual basis. As we look forward we will continue to spend meaningfully in a couple of areas. One is around what we call multi-value projects (MVPs). Those projects were identified at the Midcontinent ISO (MISO, a regional transmission organization), in collaboration with the transmission owners and other stakeholders, to accomplish three things: improve reliability, improve market efficiency and support public policy, mostly around increased utilization of renewable generation.
The other area of focus is really around the maintaining of our transmission system.
IBJ: Your projects are focused throughout the system, aren’t they?
Schukar: The MVP projects go across Illinois and Missouri. The other investments we’re making are both in our Illinois and Missouri footprint.
IBJ: The evolving of technology and the aging of infrastructure — and I guess the aging of the workforce — all have some kind of effect on achieving your goals, don’t they?
Schukar: As we think about the future, we recognize that things are changing. The model for the last 50 years has been large, central generation facilities. That model is changing to some extent. We believe we will continue to have large generation facilities, but we also expect to have much more significant, smaller generation, whether it’s windfarms, or distributed energy resources that are much smaller and located on the distribution system. What we have to focus on is thinking about the different ways these technologies can deploy and the timing of the technology, making sure our system is not only able to handle the operations we have today but is able to handle the changing technology and changing flows on the system that we’ll see in 20 years.
IBJ: Your sources for power have traditionally been coal, nuclear and water. But it’s changed a lot in just the last couple of years.
Schukar: Probably the largest change in the Midcontinent ISO footprint has been the significant investments in wind. As we know in northern Illinois there’s quite a bit of wind resources. The other place we see a lot of wind is in the Iowa, Dakotas and Kansas area. As folks are desiring more renewable resources, wind generation provides one of the lowest cost options today. Given the location of the wind, the renewable generation has to flow across the transmission system. And that’s one of the reasons we’re making investments in the multivalue projects.
IBJ: You’re working on so many fronts. Which ones are getting the most priority?
Schukar: We’ll, when I step back, what’s really getting the most priority is thinking in a value-added manner, focusing both on how do we keep the system reliable given all these changes and doing it in the most cost-effective manner possible. And that’s one of the areas where technology comes in because every year we get tools that we can use to help lower our costs of making these investments.
IBJ: It seems like any time there is some kind of a transmission project proposed, there is somebody ready to oppose it. But you’re pretty methodical in how you go about doing these projects, aren’t you?
Schukar: Obviously any time you’re putting in a new transmission line, folks will look at that and say how does it affect me? Some will like it and some won’t like it. What we try to do is focus on meeting with the local constituencies, getting their input and then trying to come up with a solution that works best across all the impacted parties. And we’ve been pretty successful with that because we do listen to impacted parties and try to make adjustments.
We’ll go look at where a line may impact land owners. We’ll look at issues in those areas. Even before we propose a route, we’ve done some due diligence to try to minimize issues we have historically seen. We may not always catch everything, so that’s why we talk to the public about what’s important to them.
IBJ: Illinois vs. Missouri, which is the bigger challenge for you?
Schukar: They both have different needs and requirements. Both states have consumers who are passionate and both are primarily agricultural. Obviously, Illinois has a different regulatory construct. It’s a much better construct than Missouri … in terms of recovery of cost and being able to make investments that you can show customer value and earn an appropriate return for the shareholder.
IBJ: What sorts of things can the Metro East area look forward to from you in the near future?
Schukar: We will continue to make investments to strengthen our system. We have quite a few projects down in this area that create jobs. We’re hiring local companies. The people who do the work on our lines are generally from nearby communities. We will continue to enhance the reliability and resiliency of the system to the benefit of our customers.