It is easy to enumerate the challenges facing the utility sector over the coming decade, but participants in DNV KEMA’s fifth “Utility of the Future” Summit in Washington, DC today were optimistic about the opportunities to build on what many pointed out was a relationship of deep trust with consumers and regulators.

Southern Company Services CEO Susan Story grabbed the conference’s attention with an easy command of extensive facts about the largest vertically integrated US utility’s efforts to adjust to changing operating and technology environments. She balanced the deep dives with illustrative examples and a strategic view of her industry’s changing place in the world.

“We as utilities are going to have to start thinking about our customers like consumer goods companies,” Story said, mentioning Procter & Gamble as an example and underlining that Southern had been expanding its consumer research in what Story said was a “fundamental” shift for the industry.

Southern has been incorporating new technology like smart meters across its service area at the same time it has undergone a remarkable shift in its fuel sources; the company has long been associated with coal reliance but in 2012 for the first time will burn more natural gas than coal as it prepares to retire 4,000 MW of coal and transition 3,500 MW of coal-fired generation to natural gas plants.

She was joined on the opening panel at the DC summit by CPS Energy EVP and Chief Sustainability Officer Cris Eugster, who laid out the advantages of diversification in fuel strategies and technology approaches for a vertically integrated utility.

While many traditional utilities view distributed generation, in which customers produce at least part of their own power, as a growing threat to reliability and profitability, Eugster welcomed the new reality. “Distributed generation has to become part of our strategy and our business model,” he said.

Both Southern and CPS Energy are representative of the broader industry as they race to incorporate more innovative approaches to efficiency into their generation and distribution portfolios, while making customers aware of how they can save money on power use over time and contribute to the reliability of the grid. These and other issues are part of a special report on data center energy efficiency available on Breaking Energy here, with data centers taking an increasingly central role in strains on the transmission grid as the economy’s reliance on information technology continues to grow.