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Business - Written by on Tuesday, February 17, 2009 18:52 - 0 Comments

Upgrading the Grid: Pacific Coast collaborative set up to create shared green energy market

Not sure if you caught Obama’s speech today as he signed the new stimulus bill, but he talked at length about the emphasis his administration is placing on modernizing the country’s electrical grid, which he pointed out is simply too antiquated to handle needs of an economy based on renewable energy. “[It's like] using 19th century and 20th century technologies to battle 21st century problems, like climate change and energy security,” he said.

Well, a colleague of mine just told me about a new Pacific Coast collaborative (called the Pacific Green Energy Initiative) that was set up to build, test and rapidly deploy clean and renewable energy systems. The collaborative consists of renewable energy industry leaders who hope to convince a coalition of state and provincial governments on the Pacific Coast (including California, Oregon, Washington State, Alaska and British Columbia) to develop a common market for green energy that would stretch from San Diego, California up to Anchorage, Alaska.

Reading through some of its literature helped reinforce for me the sheer magnitude of the challenge:

The present complex web of businesses, institutions and regulations evolved to manage an energy economy based on oil and large scale electricity generation from coal and hydro power. These organizations are not designed or organized to effectively manage the emerging, new energy economy.

That’s challenge number one for Obama, and for all political leaders confronting the challenge of making their 20th century infrastructures fit for a new era of renewable energy. It’s not simply a matter of swapping out old technology for new while keeping the existing industry and regulatory structure intact:

This new energy economy is shaping to be a patchwork of regional supply portfolios with distributed energy systems (e.g. solar powered homes, geo-exchange systems, and district scale energy supply systems) playing a very large role. It involves a shift to electric transportation and creating huge new demands for green / clean electricity at competitive prices. It involves “smart” grid technologies and more efficient prime movers and appliances across the board.

The challenges get deeper as one considers the political and leadership challenges inherent in the need to break down organizational silos and align the agendas and activities of so many disparate players:

Although many organizations (public, private and non-profit) are engaged in a wide variety of activities relating to Climate Change and Sustainability that impinge on energy technology commercialization, they are also advancing their own independent agendas. These silo agendas have little to do with the acceleration of deployment of energy technologies and everything to do with existing corporate cultures and established ways of doing things. Too often this results in activities that are isolated and ineffective, in conflict or compromised, or diluted by duplication of effort.

The fragmentation of knowledge, capability and effort is an issue I encounter frequently. You could say that it characterizes many domains (international aid, disaster relief and poverty alleviation come to mind), but it is particularly true of climate change where the solutions entail so many deep changes across so many sectors and in so many aspects of our lives.

The Western States and BC have demonstrated leadership in setting ambitious Co2 reduction targets (much more ambitious than Canada or the US as a whole). But the renewable energy industry claims (evidently with some self-interest) that the scale of investment to accomplish the State/Province targets is orders of magnitude greater than current trends within the region would achieve.

The rhetoric coming out of both this initiative and inter-governmental collaboration is interesting. I will be more interested to see what they do in practice and how they set out to enable the cross-sectoral collaborations they envision. It is one thing to hold an annual conference as the inter-governmental coalition intends to do, starting this March. It is quite another to build-up and sustain the multi-dimensional collaborations required to underpin a common market for green energy. I wish them luck.

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