Reflections magazine: How did you get into the electricity industry?
Alex Boyd: It wasn’t something popular at the time I graduated. Everyone was going into IT. But it was interesting to me because the projects involved, what I would call, real engineering. You go to the substations and they have all these massive turbines. You’re dealing with very significant pieces of the plant, and they all have an important electrical component. An opportunity was presented to me through a personal relationship when I got out of college, and I took it.
RM: What brought you to the Pacific Northwest?
AB: I started working for a big French company [Alstom Grid] in New Zealand, which is where I'm from. After a short period of time, I transferred to Sydney, Australia and spent three years there. Through them, I transferred to a software division they had here in Seattle. I was about to get married, and Katharine, now my wife, saw moving to Seattle as a great opportunity.
RM: When did PSC come into the picture for you?
AB: I left the French engineering firm and went to Dartmouth for my MBA. I had known PSC for a while and wanted to do something entrepreneurial. PSC offered that opportunity. It’s a company founded in New Zealand, and it now works in eight countries to provide power system and control systems services to utilities in a range of geographies. After my MBA, I put my hand up and said I’ll start the North American business. I was lucky my wife worked at Microsoft. She was the secure income; I was the at-risk income. And yeah, I pretty much started it in the basement of our home in Kirkland.
RM: Under your leadership, this year the North American division celebrated 10 years and consults locally for Puget Sound Energy, Seattle City Light and Snohomish PUD as well as operates offices in Canada and on the East Coast. Can you explain where PSC fits into how we consume our energy?
AB: Utilities have control centers, and in them are operators who monitor the grid—usually what you see is a dark room with banks of computers showing a range of information. The operators are monitoring everything and making decisions about how the network should be switched. Take Puget Sound Energy for example: they have a lot of connections to assets that are owned by other utilities. They want to know what’s happening at those connection points and if they’ve had a failure so they can take action to make sure it doesn’t impact the consumer. It’s relatively sophisticated and complicated control. We’re the engineers who do the work to make sure those control systems are implemented and stay up and running. We also do a lot of work advising our customers on how to develop their networks, including the addition of renewable generation resources, like wind and solar, or distributed assets such as battery banks.
RM: Also notably, in April, you personally completed a global buyout of PSC when the founders of the firm showed interest in selling. How did you come to that decision?
AB: The company was founded in 1995, and the founders were at a point where they decided it was time to decrease their risk profile, and they were looking for buyers. A very common approach is to go out to a larger firm, and they buy you out and absorb you into their organization. More often than not, the identity of the organization being acquired disappears. I asked the founders if they would accept an equivalent offer I put together. They viewed an offer from me as riskier, especially as I had a lot of capital to raise to get the deal done. However, they also saw that it would likely be better for our employees and customers. They said if I could get it done they would sell the company to me.
RM: What did that goal mean for you personally?
AB: For me personally, I was faced with the prospect of raising a lot of capital and restructuring what is a fairly complex business for its size. But, if there’s one little nugget of wisdom I learned, it’s although something like that can seem daunting, it is a sequence of business problems. I just had to identify all the smaller problems within the big problem. For many of the challenges, I asked the advice of many smart people that were supporting me. I am really proud to have achieved everything I needed to close the buyout. That said, this was a complicated transaction that will be completed over a period of time, so there is still some work to be done.
RM: Have you always embraced risk?
AB: Yes, I think so, but I have moderated that to some degree. I chose to take the risk to start the North American business, but it was not a level of risk that would have thrown me on the street if it had not worked. People I know have taken much higher levels of risk. I purchased an operating company that’s profitable, not a start-up.
RM: How are you going to lead the growth of PSC in the next 10 years? Will you be bringing significant change to the company?
AB: That’s a tough question to answer. No, not radical change. However, I think we were at a point where change was needed as the company has been getting more complex. There are some changes we can make based on the opportunity for growth available. The opportunities are bigger than ever, so the need to do our due diligence is greater. We need to have the skills in PSC to analyze these things, and I’m in the process of developing the team so we can do that.
RM: Where do you see the most growth opportunities coming from?
AB: There really are growth opportunities in most of our geographies. But especially in North America, which is where roughly a third of our business is today, and in the UK, where we have only just started. We are also starting to push into Asia. Mainland Europe is in our sights for when we are ready. Technology development in our industry is evolving at a significant rate as electricity becomes a bigger part of the energy economy.
RM: What are you excited about right now as an engineer?
AB: The transition away from bulk generation and transmission to distributed, local generation is very interesting and presents significant opportunity for innovation and the presence of non-utility participants in the industry. For example, developers can decide to build wind or solar generation and sell the capacity into the market. Some of the questions to address are: how is the electricity sold, and how do you manage the overall grid when the electricity unexpectedly disappears?
RM: So you spend a lot of time thinking about how to integrate renewable resources into the traditional electricity model?
AB: Yes, renewable energy creates a challenge due to its intermittent nature. The problem with wind and solar is that they can be there one minute and gone the next. The challenge with electricity in general is that it must be consumed the instant it is created, so keeping the system in balance is very challenging. This challenge can be helped with storage such as batteries, but the capacity of storage is limited although increasing. With the grid overall, the utility’s number one concern is making sure the lights stay on. It is not easy!
RM: Is automation something you’re hoping can help with the regulation of these sources?
AB: Absolutely. We’re working with Microsoft on some pilot projects to perform optimization of distributed energy resources. They have customers using cloud networks to run optimization to determine the best usage of the resources at any point in time. Things that affect it are: when the sun is shining, when the wind is blowing, how much energy is needed, and those sorts of things. We’re getting traction on that, and it’s a great opportunity for smaller utilities and us because the cloud is a cost-effective way to do that. However, the industry is hesitant because there are a lot of security implications involved with that.
RM: How vulnerable is a virtual grid to hacking?
AB: It’s being talked about a lot. The electric grid is classified as critical infrastructure, and it is an obvious target for anyone wanting to do society harm. It is an issue that is being extensively addressed from a technology and procedural perspective. From a cloud-based infrastructure perspective, all the big providers are spending many times more on security than any one utility can realistically spend. So the willingness of the industry to accept this approach is increasing.
RM: Any other notable changes in the industry?
AB: The other thing that’s changing a little bit is that we are seeing a lot more nontraditional industry participants. Traditionally, the utility builds transmission lines, generators and other assets, and they own and operate them. But more and more third parties are building and owning those assets and effectively get a return on the operation of that asset. They want to put their capital to work. We do a lot of work for those types of organizations.
RM: Any projects you’re hopeful for?
AB: Yes, one of our service areas is High Voltage Direct Current (HVDC) transmission. In the US, there is a lot of HVDC project development work going on, and we are working with some of our customers that are developing these projects to bring them into reality. We are hopeful that some of them will be built to help with bringing renewable energy to market and to provide security of supply in general. This trend is also occurring in the UK and Europe, but many of the projects are further developed and PSC is playing a key role. HVDC is used to get electricity back to land for off-shore wind generation, and some of our team members have gone out to the platforms to work on these projects. There is a lot of off-shore wind being developed for the US.
For more information, please visit pscconsulting.com.