What do we do when the game changes? This question is asked in many ways: What happens when you bring a knife to a gun fight? What happens when you bring pencil and paper to the digital classroom? Who moved my cheese?
People in energy policy circles are anticipating game changes in energy.
A few weeks ago I attended the 4th Annual “Energy Outlook Event – Summer 2015” in Washington DC, hosted by Navigant Consultancy, a global professional services firm and Dentons, one of the world’s largest law firms. The event primarily focused on energy policy, attracting notable speakers, including Ret. General James L. Jones, President Obama’s first National Security Advisor and Newt Gingrich, Republican Speaker of the House during the Clinton Administration. *All sessions were recorded, and YouTube links are provided below if you are interested.
Since energy policy ultimately drives literally everything from our day-to-day living habits to international global relations, it’s in our best interest to be informed of potential “Game Changers”. The following are the “Game Changers” noted by the panel of experts.
- Oil prices are surprising everyone and the US is producing enough to even seriously considering lifting the 70’s era oil export embargo.
- Abundant low cost natural gas is flooding the market
- Energy and environment policy are merging (Clean Power Plant rules and the upcoming UNFCCC Conference of the Parties (COP21) are key drivers in energy policy.)
- MEGATREND – the transition from centralized to distributed generation.
- Gridlock in congress is creating a power vacuum on energy policy filled by the executive, state and local government and (disturbingly) the judiciary.
- The impact of China and other developing countries (BRIC) on energy
- The empowerment of consumers in industry (the PROSUMER).
[Several speakers expressed concern that the US does not truly have a national energy policy and as such, policy is being set by the courts, in a completely unpredictable manner. ]
While all of these are important, what captured my attention was the nearly universal opinion that distributed (i.e. decentralized) energy resources (DER) will serve an increasingly important role in the US energy mix. (Think small scale production–small scale solar PV, fuel cells, demand management, etc.) Several participants cited DER as the wave of the future. Despite the large increase in natural gas due to the Shale Revolution and the technical challenges of pervasive distributed energy, everyone saw DER playing an increasingly important part in our energy future.
While the conference suggested DER is a game-changing trend, I do believe that the game will change slowly (a gradual increase). But because buildings and systems are built to last decades, a gradual change acts just like an instantaneous change when considered from the perspective of building and system design. So we need to be able to see ahead of the curve.
I can’t help but wonder what this means for our business. If the policy makers (and the lawyers that represent them) truly see a world where distributed energy plays a key role in our energy future, what does that mean for how we design and operate buildings? Some obvious implications include:
- Energy efficiency becomes even more important in the DER future. The ability to curtail energy use (demand response) has increasing value.
- Anyone can be an energy producer. This means more buildings will seek to produce instead of just consume energy.
- Electricity storage capacity may become important in ways that could affect building design.
You remember David and Goliath… “Everyone in the army looked at Goliath and said ‘he’s SO big we can’t possibly beat him.’ David looked at Goliath and said, ‘he’s so big I can’t miss!’” Goliath brought a really big knife (sword) to a gun (sling) fight. Because David saw the game changer first, and because he imagined a new way of operating in the changed game, he won the battle.
It strikes me that we need to be more creative about the work we do so that our buildings and clients are ready before the predicted DER revolution…so they are equipped to “win the battle”.
I invite your ideas on how we operate as the game changes. How do we:
- Innovate in the current condition?
- Stay ahead of the curve?
- Develop the imagination to operate and take advantage of the new environment.
- Adapt to change and make systems that can adapt to change?
- Design innovation?
**Session Recordings**
Welcome remarks and opening keynote: General James L. Jones
Game Changers in the 2015 US Energy Landscape
Canadian Energy Policy Perspectives and Trends
International Insights on Changing Energy Markets
Closing keynote: Newt Gingrich
– Troy Savage