The correct role of the regulator has always been a matter of debate for the state and federal officials who oversee industries from electricity and communications to banking.

But building a national Smart Grid is a very daunting task, but regional coalitions comprising industry, government and consumers are banding together to push for smaller, local Smart Grids.

On Wednesday I had the pleasure of speaking the Indiana Energy Conference for the second consecutive year. I recap some of the highlights and share my take on climate-change legislation and its implications for investors.

The recently announced “agreement” between the Libyan Investment Authority (LIA) and Verenex Energy (TSX: VNX, OTC: VRNXF) is bound to attract significant attention: LIA, a sovereign wealth fund (SWF), has become the instrument by which its sponsoring state authority has impeded market processes and damaged shareholders.

Do surging gold prices indicate inflation is making a comeback? We probably won’t be able to answer that one for a while. But one thing the yellow metal’s strength does indicate is the debasement of the US dollar after a year of unprecedented “quantitative easing” to head off depression, as well as the fact that the US is no longer the world’s only major market for raw materials.

The collapse of Lehman Brothers ushered in what’s widely acknowledged to be the worst global credit crisis since the 1930s. It’s axiomatic that credit is the lifeblood of a capitalist economy. Signs that credit is circulating are therefore good. According to Statistics Canada, Canadian household and corporate borrowing rebounded in the second quarter.

My goal isn’t to beat the averages month by month, quarter by quarter or even year by year. Rather, it’s to build wealth over a period of years. And that means being willing to hold positions I’m comfortable with though tough times.

This “best of times” for the renewable energy sector, of course, corresponds to a challenging period for producers of conventional energy, particularly of the oil, natural gas and coal that fuel more than three-quarters of America’s power plants and nearly 100 percent of our transportation.

Only two industries added jobs in the second quarter of 2009. One was health care, a sector where demand for products and services usually transcends even the most dire economic circumstances. The other was a bit more surprising.

As the cost of fuel and purchased power declines, it reduces consumers’ bills dollar-for-dollar. That, in turn, makes it far easier for utilities to ask regulators to raise customer rates to pay for system improvements, such as new power plants, power lines and even to promote conservation. Earnings rise as these investments boost rate base, even as customers’ overall rates decline.