A utility giant confronts the demand surge

The big picture: "This is probably the most growth we've seen in our industry since the advent of air conditioning," he told Axios this week.

• "It's exciting, because load growth helps with affordability, because the more people are using the grid, the more the costs to operate the grid are spread out," Butler tells Axios.

A few highlights from our wide-ranging interview:

🧮 Planning for data centers: Exelon needs to judge which proposals will become reality, especially as developers sometimes float plans for the same project in multiple regions.

• Exelon already has a "high probability" pipeline of six gigawatts of new data centers across its service areas in the next 10 years.
• Butler said milestones that get projects into that "high probability" bucket include developers paying for engineering studies and putting down deposits on land.

⚛️ Worries about data centers: Butler wants to ensure co-locating data centers with nuclear plants won't offload costs onto electricity customers.

• Exelon and fellow utility AEP recently filed a protest with FERC about an Amazon data center campus adjacent to the Susquehanna nuclear plant in Pennsylvania.
• Butler sees a precedent-setting deal. "It has to be done the right way...It's not that it's a bad idea, but you can't do it in a vacuum and enact policy by an interconnection service agreement that has loose terms," he said.

➡️ Next steps on policy: Butler called FERC's recent transmission planning rule a "significant step."

• But he said more high-level federal coordination is needed — a case he's made to Energy Secretary Jennifer Granholm.
• He offered a cautious endorsement of the bipartisan Manchin-Barrasso Senate permitting legislation, calling it a "good start."

⚡ Bullish on better wires, and batteries: Exelon is eying higher investment in tech that boosts the capacity of existing transmission lines, called reconductoring.

• Elsewhere, he sees battery storage helping lessen the need for expensive new substations in areas seeing lots of new development. Batteries help meet higher demand peaks.
• "It's about reliability, resiliency and affordability, and that's what's key there," he said.
• One barrier: rules in states where they operate that largely bar transmission and distribution utilities from owning generation, which state regulators interpret as including storage. It's part of a wider discussion with state officials about how to ensure enough energy, Butler said.

🏗️ More natural gas? Yes. Butler said that more gas-fired generation will be needed, despite renewables and storage growth.

• "It has to be a managed transition," he said. "If you keep retiring the coal-fired generation ... at this clip, you have to have something to fill that gap."