A podcast about the different people, technologies, and organizations that are coming together to remove carbon dioxide from the atmosphere and reverse climate change. We also talk about blockchains.
Subscribe to Podcast
Subscribe on iTunes
Subscribe on Google Play

#6 Michael Denby, Arizona Public Service

January 9, 2018


When investors started asking what utility companies were doing about carbon emissions, the energy sector got inspired to bring renewables online and find alternatives to pollutants like coal. And despite the Trump administration’s elimination of the Clean Power Plan, it is unlikely that coal is on its way back. The affordability and abundance of natural gas—which emits half the CO2 of coal—is bridging the gap and removing the need for coal-fired power plants. This evolving energy marketplace, fueled by business, social, and environmental concerns, could change even more radically with the introduction of blockchain technology. 

Today Ross and Christophe are speaking with corporate environmental attorney and blockchain enthusiast Mike Denby of Arizona Public Service, the largest power company in Arizona. APS is a vertically-integrated utility, both generating and selling power to its customers. Mike explains how energy trading works and the unique position of the utility company as a shareholder-driven public service. They discuss how blockchain technology might be utilized in the energy sector and how the conservative business culture of the utility industry is likely to impact its interest in cryptocurrency. Mike offers his take on the future of fossil fuels in the energy marketplace, the so-called utility death spiral, and the impact of consumer opportunities in promoting renewables. Listen in for insight into how APS generates power and how renewables and natural gas are changing the landscape of utilities.

Key Takeaways

[3:16] Mike’s interest in the blockchain

  • Sees utility companies as petri dish for potential blockchain opportunities
  • Could be used in customer payments, data management, regulatory requirements, supply chain and energy trading

[6:42] How energy trading works

  • Trading desks look ahead in five-minute increments
  • Meet demand without ramping up generation
  • Complex process, requires great deal of anticipation

[10:02] The regulation of utility companies

  • Local public utility commission sets ground rules
  • Shareholder-driven public service
  • Customers get rebate/refund if power cheaper
  • APS is monopoly, obligated to serve customers in service area

[13:38] What deregulation looks like in utility markets

  • Separates assets from wires (no vertical integration)

[15:24] How APS generates power

  • Diverse portfolio includes nuclear, coal, oil/gas and solar

[20:29] The APS solar innovation project 

  • Participating homes get break on bill
  • Aim to have renewables control grid stability
  • Would eliminate need for spinning reserve

[22:23] Mike’s insight around fossil fuels in the energy marketplace

  • Clean Power Plan eliminated by Trump administration 
  • Coal plants not coming back
  • Natural gas is bridge to future (cheap, abundant)
  • Natural gas generates half CO2 emissions of coal
  • Change comes with investor concern about carbon

[25:54] How renewables and natural gas are changing the utilities space

  • Base load facilities no longer necessary
  • Newer innovations (i.e.: turbines) come online within 10 minutes
  • Eliminating coal-fire plants will decimate entire communities
  • Companies must weigh business, social and environmental factors

[30:45] The likelihood of utility companies embracing crypto carbon offsets

  • Conservative, risk-averse business culture
  • Probably not interested in currency unless part of market that impacts them
  • Best way to influence public utility is through PUCs

[36:09] How APS could leverage blockchain technology

  • Remove middleman to control system, reduce expenses
  • Validating transactions could be done instantaneously

[40:18] Mike’s take on how blockchain will change the world

  • Will change gears, mechanisms inside world
  • Potential backbone of energy sector

[42:21] The carbon capture projects at Kemper, Petra Nova and Decatur 

  • Inject carbon into ground for use as EOR
  • Not sustainable, need definitive solution

[46:27] The potential impact of consumer opportunities in renewables

  • Many willing to pay more for clean energy
  • Assets mirror customers demand

[49:04] Mike’s insight around the ‘utility death spiral’

  • Theory of rooftop solar putting utility companies out of business unlikely
  • Rooftop solar systems still need power lines
  • Deregulation likely to happen at some point, but power lines will remain
  • ‘Deregulation spiral’ more plausible

Connect with Ross & Christophe


Carbon A List


Arizona Public Service Presentation

Arizona Public Service Electric Company

“People Have Spent Over $1M Buying Virtual Cats on the Ethereum Blockchain” in TechCrunch

Petra Nova Project

Illinois Basin Decatur Project

Get Our Newsletter

Sign up for weekly updates on progress building our carbon removal marketplace.

Stay Updated - Listen to Our Podcastitunesitunes