August 2023 Vol. 78 No. 8
Features
AGA Chair sees future shaped by education, innovation
(UI) — Suzanne Sitherwood felt at home from the moment she arrived at her college co-op job with Atlanta Gas Light. The daughter of a U.S. Navy chief petty officer, the environment she found at the Georgia utility immediately brought to mind her experience growing up on military bases around the country.
“I drove up to the facility and saw barbed wire fence, trucks and people in uniform and thought, ‘Okay, this is the place for me,’” Sitherwood said. She never lost that feeling of connection as she trailblazed through the ranks over three decades at the later-named AGL Resources.
Starting as a corrosion technician – taking cathodic protection readings at customer meters by day while attending school at night – she became the utility’s first female field engineer after graduation and, later, its first female vice president of engineering and senior vice president of gas operations before serving seven years as president.
Again, channeling her military upbringing and tapping into her studies in organizational design and behavior, Sitherwood developed a team-minded management style that emphasized planning, accountability and communication, successfully leading operations and integration, as well as numerous acquisitions and expansions.
She was recruited in 2011 by The Laclede Group to replace its retiring CEO and lead a similarly aggressive growth agenda at the St. Louis-based utility. Under her watch, the company has acquired four natural gas utilities, expanded and updated its infrastructure and modernized its trading and marketing business. Spire’s enterprise value, meanwhile, has grown more than sixfold and its market value more than quadrupled. It is now the fifth largest publicly traded natural gas utility in the United States.
Sitherwood, who plans to retire from Spire this December, sat down with Underground Infrastructure to discuss her career, her outlook for the natural gas industry and her work as the 2023 chair of the American Gas Association (AGA).
UI: You’ve been on the board of the American Gas Association for more than a decade, but this year was your first term as chair. Did you adopt a specific theme for the year, as others have done?
Sitherwood: You’re right, it’s been something of a tradition at AGA for the incoming chair to state a theme for the year. And I can remember talking with some of my AGA colleagues and questioning this some years back. You don’t change your strategy every year. It’s a long-term view of the business and where we need to be driving, and then the underlying strategies that we want to deploy to support that. And the AGA has already published its strategy in this year’s playbook titled, “AGA’s Bold Action for a Clean Energy Future.”
This playbook may be updated, but the strategy doesn’t change. So that’s the way I think about the idea of a theme – themes are more powerful when they are constant. But what is it that I’m most focused on and feel like I might be able to accomplish this year? It boils down first to education, which is part of the reason I keep this book here.
UI: What led you to focus on education above all else?
Sitherwood: We, as an industry and within our organizations, can do a better job of educating policymakers, businesses and consumers. The questions facing us are, how do we effectively educate about natural gas energy using all our resources? How do we connect to different types of customers – through our social media, through our technology platforms, through our community meetings, through our philanthropic giving – to educate them on the role that natural gas plays in the United States and the world?
People have a keen interest in natural gas now and want to learn more. There are some you’ll never convince of its benefits, and there are some who are much more knowledgeable. But most of us are in the middle. We have busy lives, but we also want to be a bit smart about a topic that’s important to us.
We also want to know what we’re hearing is true, and I think our industry and our individual companies are trusted advisors of sorts. We’re regulated, so we also work extensively with state regulators, governors and other policymakers. I think that’s part of our connectedness. Fortunately, the AGA team has gotten really good at providing us with resources so that we’re all singing from the same hymnal, so to speak.
I believe that part of the way that people learn and think about these things is through education, and we have the ability to drown people with factual information through our people in the field, our websites and social media, and with our bills that go in the mail or electronically to customers. Innovation is the other piece I’m specifically focused on now because education and innovation go hand in hand.
UI: There have been some worrisome trends for the industry around actions such as efforts to ban natural gas from new construction in certain cities. What is the pulse of policymakers you talk to?
Sitherwood: It’s difficult to make a blanket statement across the United States, of course. When I talk to policymakers, I find that they’re getting a lot smarter about energy. These are people who have responsibility for making sure that our industries continue to function.
And why is that? It goes back to the point that we have to invest in infrastructure and modernize energy systems. And yes, we’re looking at renewables and how to add that to our system, and we’re looking at hydrogen. That’s important. That’s innovation. It’s part of our future, and it’s our job. But from a customer perspective, people want resilient, affordable energy that works for them.
UI: Have you found that people are becoming more attuned to the concept of energy security after the Russian gas supply cuts to Europe?
Sitherwood: Yes, there is a little bit of an awakening now, given what people have seen with Ukraine and Europe, the relationship between Russia and China, and the need for energy resiliency and access to energy.
Yes, they know about the opposition to fossil fuels. But I think more people are trying to understand global events, how things are related and how they impact one another. Suddenly, countries like France are saying they need imports, and other countries in Europe are signing longer term contracts with U.S. natural gas suppliers and need imported natural gas or LNG to decouple their access from Russia.
We have 187 million people in the United States who are using natural gas. So, people are looking at Ukraine and saying, ‘No, I don’t want my gas taken away. I want to stay warm and have hot water and cook meals.’
UI: Are you concerned about the increased difficulty in building infrastructure in the United States, so people who want natural gas can get it?
Sitherwood: This is extremely important to me because I believe it’s foundational to our country. We are a free society and customers should have a choice. They should have the opportunity to be educated. And we have a responsibility to inform.
We should be the ones creating the innovation and the technologies that are going to better our energy future. On a global basis, when our energy infrastructure is strong, there are supply choices and we keep our prices reasonable and competitive in the world. We know we’re a stronger country for it. Manufacturing in the United States can compete when energy supplies are reasonably priced, abundant and resilient. So, the brewer down the street here or the chemical plant we talked about don’t have to worry if the energy will show up or what their prices are going to be.
When you constrain infrastructure and constrain availability of the supply basins, you are constraining our country and you are constraining our industry, not to mention affecting customers at home trying to pay their bill. That’s what I’m passionate about at a larger scale.
And why would we not lean into a true natural advantage for this country – an abundant supply of natural gas coupled with a readily efficient safe way to deliver the energy that Americans need and want.
UI: Looking back at your time at AGL, you followed an operations career path, but all the expansion activity you were involved in seems to have given you a more diverse experience.
Sitherwood: Yes, I would say that’s true. Atlanta Gas Light was the state gas company and had been for decades upon decades, and early in my career it decided to start acquiring other gas companies. We acquired Virginia Natural Gas and then eventually acquired a New Jersey company which came with a Miami company. Then we acquired Nicor, which has over 2 million customers, and that really extended the size of the company. So that’s how I learned – by digging into the transactions themselves, as well as the technology and the integration.
But we also had a marketing company and had invested in storage facilities and built some intrastate pipelines at AGL. So, a lot of my experience was not necessarily by title of the work I did, which was quite varied as well, but also from what was happening with the company during that period.
UI: Laclede wasn’t known as a growth company before you got there. How did that change?
Sitherwood: Laclede Gas at that time in 2011 was the smallest of its peer set, and the board thought we really needed to pivot and grow the company because it was too small to be highly invested in technologies and benefit from scale. And of course, within a year after I arrived, we acquired a gas company in western Missouri.
UI: So, Laclede brought you in to replicate that success at AGL?
Sitherwood: Yes. When the board interviewed me, they asked very specific questions about growth. “How do you think about potential acquisitions? How would you approach an acquisition? How do you think about the analysis? If we prevail, how do you think about the process of integrating the business and how it impacts people?” And then, how much technology is deployed, because at that point we didn’t really have the information technology that we have now.
Fortunately, not long after I landed here, those western Missouri assets from Joplin all the way north past Kansas City became available. We have a great team here, and it was just going back to my experience at AGL: organizing teams and people and their roles, then putting them together in a way where they understand the North Star, the path to get there and ensuring they have the ability to lay out the work and do it in an efficient, effective way – all while understanding the people impacts. So, the team did a great job integrating the west side of the state. Then, shortly after, another utility system became available in Alabama.
UI: That was a fast start, but the expansion went farther than that, right?
Sitherwood: Yes, we acquired the Alabama utilities and set up a marketing company in Houston. Then we acquired our midstream storage facility assets. Next, we also built a pipeline to connect to the REX – the Rockies Express pipeline – from St. Louis to bring shale gas into the region. And we started working to upgrade our older systems in the St. Louis area.
UI: How important was that pipeline project to Spire?
Sitherwood: By building that pipeline, we not only brought relatively inexpensive gas to the region, but also, we built great resiliency and reliability into our system. That’s been extremely important. The St. Louis region has a healthy industrial market here, from brewing beer to chemical plants, to automotive, to aviation. These are very large industrial facilities and they rely heavily on natural gas.
You want these customers to be able to count on their natural gas service, and you never want them to have to shut down because they don’t have the energy they need. They’re very well educated on our system and where our natural gas basins are. That resiliency is part of the reason those facilities are here, and they’re very appreciative of that level of certainty. When we went through a massive winter storm in this area, for example, we did not have to curtail gas supplies to any of our customers.
UI: It must be rewarding to see those positive impacts after overcoming the opposition that all pipeline projects attract now.
Sitherwood: I’m very proud of what that pipeline has accomplished for our customers and our region. I think it’s a symbol for how important natural gas infrastructure is for this country and for proper analysis, in terms of regions and states making sure that we’re building for our future. Not just the pipeline, but the modernization of our aging infrastructure here in the St. Louis region. We rebuilt the backbone of our systems and were able to elevate the pressures because we had new pipe. And most of the gas came in from the east side of St. Louis, so by adding that pipeline we were able to push gas west and south, which is where the growth area is in this region. I think it’s a role model for why pipeline development is extremely important.
Of course, we’ve had four FERC [Federal Energy Regulatory Commission] approvals now on the Spire STL pipeline. And a lot of companies and customers and people in the industry followed pipeline certification process when it was challenged. I just think it’s emblematic of how strong and smart our systems are, and it was a great way of educating a lot of customers and regulators and legislators about the significance of natural gas infrastructure and what supply basins are available for different communities.
That diversity of supply, diversity of infrastructure and modernized systems will ensure that we’re serving our communities well for decades to come. Because you don’t incrementally plan and build pipelines, as you know. You design for the future.
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