Where will our energy come from in 2030, and how green will it be?

Original interview posted by the World Economic Forum.

How can the energy industry adapt to meet the needs of a growing population while also supporting low-carbon growth?

Katherine Hamilton, Director of the Project for Clean Energy and Innovation, and co-chair of the Global Future Council on the Future of Energy, says that this essential transition will not happen without collaboration between large energy companies, entrepreneurs, the finance sector and consumers.

Why should we be thinking about the future of energy?

The energy sector is already changing very rapidly. It is transitioning, we hope, towards greater ability to meet the energy needs of a growing global population with reduced use of carbon, supporting continued economic growth in an environmentally sustainable way.

But that transition will not necessarily happen on its own. We need to get key players in the same room who can bring different experiences and perspectives, and collectively come up with better ideas than any of us could on our own – and then work out how to implement those ideas. Hence the need for this Global Future Council.

Who are the key players that need to be involved?

The incumbents are important, of course – the large energy companies who own and control the infrastructure, especially in industrialized countries. They are often criticized as part of the problem, but they also have to be part of the solution. In addition, we need the innovators – entrepreneurs who are coming up with ideas to disrupt the sector. And we need input from energy consumers, including large corporations and municipalities.

Representatives of the financial sector are important – experts in bonds, risk and insurance. There is plenty of capital out there looking for good projects to finance, but the main constraint for investors is the assurance that those projects will find a market. Creating certainty is one important thing politicians and policymakers can do to help – and it is they who, ultimately, will need the vision to define goals for the energy sector and devise policies to achieve them.

What are the biggest emerging trends in the energy sector?

The decentralization of energy generation is an enormous trend. Innovation is also being democratized; it is no longer just the incumbents who can innovate. Consumers, increasingly, are in the driver’s seat; there is more real-time interaction between energy service providers and consumers – whether that is the operator of a factory with sophisticated demand response or an Indian farmer using a mobile phone to manage crops.

We are continuing to see drastic reductions in the cost of many renewable technologies as well as greater accessibility to energy storage and efficiency.

How far are we from renewables no longer needing subsidies to compete?

Any time you talk about subsidies for renewables, you also have to remember that incumbent players have benefited from built-in subsidies for decades through policy support and monopoly power. Often there is a misconception that energy was a free market before the idea of subsidizing renewables came along. That is not the case, and we need to recognize that when we ask how best to adjust the market for innovation going forward.

What kind of innovations are we seeing in energy, and what might we expect in the coming years?

The sharing economy will be increasingly important in the transport sector. There is potential to improve efficiency and greatly reduce emissions as we move towards more electric and autonomous vehicles.

There is also room to harness data to make the grid and entire energy ecosystem more efficient. The data is available, through advanced meters and mobile applications, for example, but we have yet to fully exploit that data to move energy to where it is needed, smartly and in real time.

I expect to see more “community solar” projects, as collective consumers invest in generating and storing power. There will be more distributed generation using a variety of technologies, such as solar, wind, geothermal, fuel cells, and hydropower. We will see further innovations in multiple uses of energy storage, such re-purposing car batteries to store electricity.

In the coming years we might see some breakthroughs in carbon capture and storage – and, no doubt, there will be innovations and applications nobody has thought of yet.

What needs to be on the agenda for energy stakeholders?

Above all, we must have a solid plan to reduce carbon, To reach that, we have to define what we value – not just improving access to energy, and guaranteeing energy security to meet the needs of economic growth, but doing all of this in a sustainable way and one in which carbon emissions are drastically reduced. Then we need clear and transparent benchmarks against which to measure our progress.

We also need a vision that combines the decentralized and the centralized – embracing more distributed generation, while looking at the larger system and how we can move energy around globally in real time.

Finally, how might the energy sector look by 2030?

I fear that we will be paying for our previous failures to reduce carbon emissions, and being increasingly preoccupied with climate change adaptation. But I also believe that we can have a sector that delivers much higher access to energy than today, with greater use of renewables, incentivizing innovation and creating economic growth while reducing our impact on the planet.

The Annual Meeting of the Global Future Councils took place on 13-14 November in Dubai.

What Do the Results of the 2016 Election Mean For Clean Energy in DC?

Originally posted on 38 North Solutions blog.

The results of this week’s election are certainly a surprise and will impact the focus and direction of policymakers moving forward. As we look ahead, historically, Congress is most active when one party controls the House of Representatives, Senate and White House. We expect 2017 to follow this trend, particularly because Republicans campaigned, in part, on a message of fixing the gridlock that exists in Washington. As a result, the next two years are going to be busy and significant.

The 38 North Solutions team has a proven track record of working with legislators on both sides of the aisle and feels well positioned to help companies and organizations navigate this new period. The weeks and months ahead will clarify where the Trump Administration and Republican Congress will focus their attention, but here are our initial thoughts about what lies ahead:

Lame Duck, 114th Congress
Before the election, the prevailing assumption was that the end of this year (Lame Duck Session) of Congress would be especially busy as members from both parties try to clear the decks of any remaining pieces of legislation before the bipartisan-viewed wildcard of a Trump Administration assumes power. However, the overwhelming nature of Trump’s win, coupled with the fact that Senate and House Republicans performed better than expected, has diminished the appetite amongst Republican members to negotiate with Democrats and President Obama at the end of the year in any significant way. As a result, the opportunity for successful enactment of clean energy provisions like reinsertion of the technologies that were removed from the Investment Tax Credit last year has closed significantly. Funding for the federal government expires on December 9th, so Congress will have to address that before adjourning, but the likelihood that the ITC or any other policy provision gets attached is limited.

Federal Legislation, 115th Congress
With a GOP-controlled House, Senate, and White House, we expect the new President to be able to pass energy legislation that could include PURPA and Federal Power Act reform. We will need to be vigilant to ensure that those provisions are not detrimental to clean energy technologies and applications, while mining opportunities to insert clean energy provisions into non-controversial legislation. There is no realistic scenario for passing a carbon tax, renewable portfolio standard, clean energy standard, or additional clean energy tax credits. In fact, we will need to work hard to shore up support for existing clean energy provisions to ensure that they are not repealed. On the positive side, innovation is key to growing the economy and jobs and we can continue to hammer those messages to energy policy and tax committee leadership. There may also be a path for additional transmission provisions that can increase build-out of infrastructure across the U.S., although we would not expect a large spending provision in any case.

Companies interested in advancing clean energy policy must not view yesterday’s election as an imperative to disengage in advocating before Congress. Rather, moving forward, we know that the Trump Administration has every intention of passing an aggressive legislative agenda next year. It is therefore critical that we continue to make the strongest case possible for policies that will continue to support an innovative energy economy.

Environmental Protection Agency
The Obama Administration’s landmark achievement regulating carbon dioxide emissions from power plants, known as the Clean Power Plan (CPP), is now in serious jeopardy. Because the CPP is a federal regulation, the Trump Administration can undertake steps to undo the policy without seeking congressional approval and we expect taking such action to be a priority. The good news is that the CPP has helped states to think strategically about how to move to a cleaner energy generation mix and investment in those technologies has shifted to support that movement. We believe that utility and corporate investment in clean energy will continue to grow. In addition, regulatory processes on clean energy in states will continue to move forward.

Department of Energy
Funding for specific programs within the agency may shift to more fossil and nuclear research and development funding and less renewables and energy efficiency funding. Less clear is how the Office of Electricity Delivery and Energy Reliability would be impacted, although Trump’s energy agenda includes grid modernization. It is hard to envision the Quadrennial Energy Review process continuing since this was a project led by Secretary Moniz.

Federal Energy Regulatory Commission
FERC is generally not considered political and the two vacancies are slotted for Republicans. We know at least one of those potential appointees and think that other credible nominees would likely come from regulatory and public policy arena. We will need to continue cultivating those relationships to ensure that wholesale markets for innovation will continue to be considered.

While yesterday’s result may not have been what we expected, it is the reality we face moving forward. We would be happy to set-up a time to meet to discuss specifically what the Trump Administration’s ascension may mean for your business and how we can work together to ensure that your interests are being adequately addressed in Washington.

The Future of Electricity: Clean and Bright

What happens when you bring together nearly two dozen energy leaders from across the globe into a room for several days of uninterrupted discussion on the Future of Electricity? Throw in jet lag for anyone not from United Arab Emirates, add a cocktail of fossil fuel interests along with renewable energy advocates, shake well in nearly 100 degree F heat, and one could not imagine consensus coalescing around almost anything. Surprisingly, perhaps, this group, convened by the World Economic Forum, agreed on a set of trends that indicate change is nigh in the electricity sector:

  • The world is increasingly electrified.
  • Renewable energy has the greatest capacity growth.
  • Clean energy enables growing universal access to electricity.
  • Energy security increases as a result of more indigenous clean electrification.
  • Distributed energy resource deployment is significantly increased.
  • Energy storage provides critical grid services.
  • Consumer engagement and choice shape future electric growth.
  • The price of electricity may increase briefly, then decrease, over time.
  • Regulation supports and accommodates these changes.

This transformation will not happen organically, however. The group also identified requirements to realize this transformation in our electric system:

  • Politic targets must be clear, transparent, and consistent.
  • Regulation should anticipate trends and create a climate for investment.
  • Power markets and platforms must be open for all participants.
  • Financing mechanisms should be clear and risk factors understood.
  • Business and monetization models must evolve.
  • Consumers must be allowed to participate.
  • Special provisions should be made for universal access.

It was affirming as a participant in this process to hear from others about the same policy hurdles I deal with every day in Congress, state legislatures, and regulatory bodies. My firm‘s public policy work, while mostly centered in the U.S., can be informed by policies that have been tried elsewhere with varying degrees of success. That the Global Agenda Council on the Future of Electricity could arrive at these principles and requirements should give us all a cogent road map to this transition. Read the full report here.

Omnibus Package: Sausage with Delicious Clean Energy Provisions

Post published on 38 North Solutions website here.

The omnibus deal—PATH (Protecting Americans from Tax Hikes Act of 2015)–was sausage-making at its most intense, but the product should be palatable for most parties in clean energy. Extensions for renewables and efficiency tax credits were key sweeteners to lifting the oil export ban. In addition, clean energy R&D funding, reauthorization and increased funding for the Land and Water Conservation Fund, and climate change funds (Clean Technology and Strategic Climate Funds of Bank for Reconstruction & Development and Global Environment Facility) were included in the deal. While the solar and wind credits are phase-downs, the trajectory should provide much-needed certainty to renewable energy investors, developers, and consumers and will serve as a bridge to implementation of the Clean Power Plan, the longer-term market driver for clean energy in the U.S.

House and Senate leaders—McConnell (supported by Chairman Hatch of Senate Finance), Reid, Ryan, and Pelosi—were key to ensuring that this deal could pass their caucuses, and the White House provided additional feedback throughout the process to ensure the President would sign the resulting package. Because of vociferous opposition to lifting the 40-year oil export ban, the environmental community for the most part had to sit this fight out. The renewable energy industries, in particular solar whose credit did not expire until the end of 2016, had to carry much of the water on the renewable energy extenders. New allies were made, especially in the Republican Caucus, that allowed for greater bipartisan support than has been seen in a number of years.

Now, the renewable energy industries can turn their focus to state and local policies, siting and permitting issues, and compliance strategies for the Clean Power Plan.

Transformation through Leadership: Clean Energy Education and Empowerment (C3E) Symposium

Originally published in Scientific American, November 11, 2015.

They came in all ages—college, graduate school, early career, mid-career, mature career, semi-retired—many ethnicities and backgrounds, but mostly one gender. These were women gathering at MIT in Cambridge, MA, for the fourth annual Clean Energy Education and Empowerment (C3E) Symposium.

Caroline McGregor of the U.S. Department of Energy, which started this program in conjunction with the MIT Energy Initiative (better know as MITei—pronounced “mighty”), describes this initiative as the “recruitment, retention and advancement of women” working in clean energy. When Carla Peterman, a Commissioner at the California Public Utilities Commission, took the stage to receive her Government Leadership Award at last week’s Symposium, she remarked, “Women collaborate without even trying.” This symposium certainly felt that way.

Some years the theme for the C3E Symposium has been less clear; this year it crystallized: transformation. Women are leading the transformation of innovation, of climate solutions, of our world. Each and every woman at this conference is dedicated to transforming systems and lives through engagement and work in clean energy.

The importance of engaging women at all levels in the energy sector was emphasized by MITei’s Martha Broad, and Bob Armstrong with the latter saying that “…we need all hands on deck” to solve climate change.

In addition to group discussions of career advancement and speed networking, several panels took on difficult and complex challenges, such as the energy and water nexus or the transformation to a low carbon future. With 40% of water withdrawals in the U.S. going to thermal electric generation, the panelists discussed the need to arrive at creative solutions for managing the earth’s water sustainably. Challenges in developing countries around access to clean water and energy were highlighted, with discussions on innovative water desalination technologies and distributed solar technologies and delivery systems. One of the major differences seen with the panel discussions at C3E is that all of the speakers and moderators were women—something that is truly unique in the male-dominated energy sector.

Throughout the two days, several key themes inherent in transformation emerged.

It is okay to fail.

“Every girl should have the ability to build, fail, then build again—and in an unstructured environment”, said Grace Overlander, of Tesla Motors, who won the Business Leadership award for her work launching a dozen product lines in the automotive industry. This was a recurring refrain with speakers who assured the attendees that bad experiences are okay and that each career move can be a learning opportunity, spurring one to demand more from the next step. “Don’t stop because of one failure,” urged Leslie Labruto of the Clinton Foundation.

Women have the power to make change.

When a seasoned and accomplished professional was asked what advice she had, she said if she had to do it again, she would be Anya Cherneff, CEO of Empower Generation, who was awarded the International Leadership Award and has launched 15 businesses with 200 sales reps for solar lighting in remote communities in Nepal. “I have just started to recognize the power I have to make change,” reiterated Lisa Cagnolatti of Southern California Edison. Barbara Kates-Garnick of Tufts University was more practical in her approach. “Diversity is a business decision that benefits everybody,” she said. Her panel, which delved into the need for more granular tracking of women in clean energy, especially in STEM (Science, Technology, Engineering and Math), concluded that there is not enough data about women. “This lack of information makes women invisible,” continued Kates-Garnick. “What is not counted does not count.”

Every age can engage.

C3E Ambassadors are hand-picked female leaders who have reached maturity in their fields and who spend time together deciding who will win the prestigious awards. These women have internalized the need to “build the bench” of young women who will take their places and create even more leadership positions for women in clean energy. The award winners are mid-career women who have made extraordinary gains in various aspects of clean energy. These awards can mean an enormous amount to their careers and next steps toward leadership. Then there are graduate students who present posters of their projects, among which Symposium attendees choose one winner. Last year’s poster winner, Caroline Golin, has in the year since her award launched her own company, GreenLink, and gone on to obtain numerous contracts to perform solar analysis in the Southeast and throughout the nation. A group of younger women, undergraduates in STEM programs, have the chance to present three-minute “lightning” presentations of their research. Many more women attend as invitees of each of these groups of professionals, sowing the seeds of leadership and enthusiasm to make an impact in clean energy. With live webcast, the hope is to reach many more women who are unable to attend in person.

It is up to us to find transformative solutions.

Rebecca Pearl-Martinez, Head of the Renewable Equity Project, Center for International Environment and Resource Policy (CIERP), Fletcher School at Tufts University, observed that “gender diversity could be the next carbon wedge, propelling both clean energy technologies and economic growth.” Others remarked that we can empower women to power the world. People want more than just a solar light—want entire electricity lifestyle. Erica Mackey, the Founder and CEO of Off-Grid Electric, who was awarded the Entrepreneurial Leadership Award, for her ground breaking work to deliver state-of-the-art solar products in sub-Saharan Africa, stated that “they are focused on making solar affordable to everyone—household by household.” Melanie Kenderdine, the founder of the MITiE and now a close advisor to DOE Secretary Ernie Moniz and head of the Office of Energy Policy and Systems Analysis, delivered a keynote address with a tutorial on where our energy resource mix is now, what policies are needed, and how we need to get more serious about funding solutions to climate change. Others agreed that sustained policies help technologies make transformation possible. While there are hopeful signs of this transformation, the opportunity for change is immediate but implementation can feel painfully slow.

Next year will celebrate the fifth anniversary of the C3E Symposium and the leadership awards. Now the task will be to ensure that all women—not just those who are lucky enough to attend the conference—are empowered to lead the clean energy transformation. Kenderdine observed that as she ages, she feels that it is ever more important to help younger women coming along. This C3E Ambassador couldn’t agree more.

Utility of the Future: or What to Think When Everyone Says Your World is Turning Upside Down

[Originally published in Energy Biz]

As the red-eye jet made its way toward the airport with dawn breaking, street lights still on and house lights coming on, I watched first the farms with long roads, then the small clusters of towns, then the vast suburban outreach of Washington, DC. I had been thinking a lot about the evolution of the electric grid. From above, one could see how electricity, whether urban or rural, connected all of these people and businesses into one enormous system, sometimes dense and sometimes sparse, but always on. Now the next generation of innovation is poised to change the way we think about and use this system.

Many of these innovations are more than just information flow—they are real energy resources like solar and energy storage, demand response, and energy efficiency—that affect both the operations and business of utilities. At a recent conference in Hawaii—a state that has been undergoing such tremendous and real-time alterations to their grid that I have likened it to changing the tires while the car is moving—state regulatory Commissioner Lorraine Akiba said, “The integrated grid of the future is one that requires strategic actions to realize the full value of central power and distributed energy resources.” [1]

Akiba touches the key here to the future of our utility model: integration. The term came up again at a recent energy storage conference in California when a utility representative said, “Our job is not to simply connect, but to integrate.” The integration will need to be both physical—which has always been the operating premise—but also digital. Moreover, this integration does not need to rely on a centralized system of power generation plants connected by long transmission lines, but rather can allow for disaggregation of flexible and distributed resources.

One case to watch is the New York REV proceeding[2] where utilities—already decoupled from generation—are being asked to become consumer-service platform providers. As the commission Chair Audrey Zibelman has said, “By fundamentally restructuring the way utilities and energy companies sell electricity, New York can maximize the utilization of resources, and reduce the need for new infrastructure through expanded demand management, energy efficiency, renewable energy, distributed generation, and energy storage programs.”[3] The key here will be whether the utilities will be able to perform all these services, operate their system, and remain cost-competitive at the same time.

Utilities that see this integration with disrupters as a business opportunity stand to benefit. As in the case of New York, utilities could start thinking of themselves as service providers or, at least, integrators. What the Federal Energy Regulatory Commission has done on the bulk-power side by allowing compensation for characteristics and services provided to the transmission side of the system, state regulators could do on the distribution grid by allowing compensation for a wider range of values.

Another potential construct–proposed in the REV proceeding with Jon Wellinghoff, former Chairman of the FERC and Jeff Cramer, one of my business partners—would be for distribution utilities to adopt what FERC put into place when it issued Orders 888 and 2000[4], enabling the creation of competitive wholesale markets and Independent System Operators. This would be a comparable system on the distribution side, or Independent Distribution System Operator (IDSO).[5] The IDSO would enable distributed energy resource integration, greater consumer choice and participation, and allow for a more efficient and transactive energy framework.

Yet another option might be that utilities and others could be compensated for increased efficiency, for decreased energy intensity, and for lower-carbon resources (especially as the EPA Clean Power Plan is finalized and states begin implementation). State RPSs already give utilities credit for renewables, and in decoupled constructs, utilities are given credit for efficiency programs. What could be new is a more holistic set of metrics—going beyond but not totally dissimilar from the Value of Solar model.[6] That new set of metrics could: take into consideration what we want out of our system; put rules in place to compensate for those services; incentivize entities to provide those services; and then allow all participants to compete to provide services. Utilities could be winners in that model, but so could consumers and innovators.

It would be helpful to have a national policy that sets goals and objectives for our electric grid that could be the basis for a new compensation model. But states can set their own policies, as California has, that drive innovation in resources that can help meet state goals. The impetus does not need to be limited to state leadership, either. Vision can come from utilities and innovators collaborating to offer a set of services that are presented to commissions and allow them to see (and compensate) myriad benefits of that integration.

To keep those lights on that dot the landscape, whether in clusters or singly, utilities can join forces with “disrupters” to ensure that everyone benefits from a cleaner and more efficient system. They key is to move beyond simple connection to integration.

How Hard Can It Be? Willing to Take Risks Through Career Choices

Originally featured on C3E.net blog.

Ten or even five-year career goals have always seemed foreign to me. I graduated from college with a creative writing degree–writing and illustrating children’s books had been my dream–and then prolonged the work search by getting another degree in French culture and civilization from the Sorbonne (who wouldn’t want to live in Paris?). The first job I landed once I moved to Washington, DC, was serving subpoenas for a law firm. Even back then $6 an hour was not a living wage and I found myself making my own suits and not particularly liking lawyers. What to do next? I had worked for the electric utility during college as a technical writer and applied to be an innocuous sounding “service representative”. I would be in a three-year program with a test every six months and would be required to take night classes in engineering. How hard could it be?

Before the end of the three-year program, I was designing transformer and switch vaults with French drains (I knew French!) and sixteen way duct banks. I engineered circuit conversions. I wore a hard hat and carried an equipment bag to stake out projects that I had drafted onto construction blueprints (I could draw!). I moved on to commercial marketing, conducting energy audits and convincing building owners to install ice storage systems. Here I was for nearly a decade honing skills I never thought I had and having fun in the process.

The time had its challenges, such as when my boss called a staff meeting to state publicly that he hoped my pregnancy would not prevent us from making our goals. During my second pregnancy, the head of HR told me she thought it would be better for me to take the path of her sister who had kids and stay home. This was just before Clinton passed the Family and Medical Leave Act; I had just six weeks off for each child. I also really wanted to work more in clean energy and started looking around for opportunities. I found a memo in a colleague’s in-basket from a leader at a Department of Energy program that sounded interesting. I gave him a call.

This gentleman became my mentor, hiring me to run several programs through the National Renewable Energy Laboratory. To be employed by the lab I had to present before a team of a dozen scientists. I was not a scientist but I did know something about creative utility rates I could tell them. Hey, how hard could it be? I was at NREL for almost a decade as well, getting my Certified Energy Manager license, starting a federal energy audit program and then a water efficiency program. A colleague of mine at the lab was leaving and the position of Manager of Government Relations would be open. I had never worked with Congress and the lab needed someone to translate the scientific programs into plain language (I could write!). That couldn’t possibly be as hard as engineering.

This was really the way my career worked. I would see an opportunity, decide that I had the skills to do it (or could get the skills if I worked hard enough), dive in, and try to have fun along the way. Not that I think I know everything, but that I have the capacity to learn. Other opportunities came my way that I took—working for a private equity firm on policy (while sourcing investments and doing technical due diligence), running a large and growing trade association, starting a clean energy and innovation policy company with several other folks. Not everything was easy. I was fired a couple of times and had to scramble for new work and heal emotionally. I have certainly had moments of self-doubt but never once thought anything was just too hard. If I were to describe what has kept me going through these thirty years working in clean energy it would be that very attitude: how hard can it really be?