Oil guru: 'smart' hoopla outpaced reality, Part II
In yesterday's column, we offered the first part of my look at a conversation between Pulitzer Prize-winning energy author Daniel Yergin and my colleague Marty Rosenberg, editor of EnergyBiz magazine, which hosts the 2012 EnergyBiz Leadership Forum set for March 19-21 in Washington, D.C.
In the prior column, Yergin discussed how global electricity consumption doubled from 1980 to 2010 and will double again by 2030. The author gave his take on smarter grids and on the need for "heavy duty technological innovation." We continue with his views (and my kibitzing) here.
As an author writing on energy, how does Yergin find the public appetite for energy-related discussions? Rosenberg asked him. (Hint: his answer may be useful to the power industry's own quest for involving its customers.)
Attention rises when there's a crisis, Yergin replied. His book, The Prize: The Epic Quest for Oil, Money and Power (1991) was released during the Iraqi invasion of Kuwait and shot to the top of the best-seller list. Yergin's The Quest: Energy, Security and the Remaking of the Modern World (2011) entered the picture during a time of ongoing economic stagnation.
"There's an interest among young people in energy that wasn't there before," Yergin added. "Clearly, the public is very interested in energy alternatives, green energy. Climate is an issue that has gotten a lot more people interested in energy. For a lot of people, it's a pocketbook issue. When prices rise, people are concerned with stability, with reliability. This is something that Americans are worried about. What does our energy future look like? That's one of the reasons they're interested in The Quest, because it gives you a framework for coming to clearer views on your own part in [that future]."
I'd jump in here to ask, rhetorically, whether that insight really does help the power industry. Do regional blackouts or storm-related outages really provide a platform for pressing grid modernization investments? Or does that seem too opportunistic? I'd like to hear from customer service and communications people on that question. It strikes me that a credible message should be consistently conveyed and if a crisis draws customers' attention, that message is in place.
Yergin and Rosenberg touched on the issues surrounding the power industry's fuel mix of coal, nuclear, natural gas and renewable energy. Yergin placed into context the power industry's current fascination with natural gas—touted by some as solving the power industry's concerns with both cost and lower air quality impacts—when he characterized the relationship over time as "turbulent and tempestuous." Natural gas' history of price spikes has repeatedly "burned" the power industry, he said. Natural gas advocates' enthusiasm aside, that history makes some utility executives uneasy.
"Is this time different?" Yergin asked, rhetorically.
According to Yergin, the U.S. currently is an exporter of coal, natural gas is becoming the default fuel for electricity generation and the country must partner with France and Japan if it pursues a nuclear future. Meanwhile, for many reasons, including the impacts of greenhouse gas emissions and the high return on investment for energy efficiency measures, investment in clean energy alternatives has increased, he added.
All fairly conventional points, to be sure, but coming from another perspective in the energy sector.
One is tempted to combine the titles of Yergin's two most popular works with what appears to be one of his central themes. That is, that the quest for the prize will reward the players who innovate around clean energy. I believe the evidence reflects that the U.S. could succeed in this endeavor, but the pitfalls are deep and many, including a lack of focus on the future. Despite the fury of innovation taking place here, politically and institutionally, America is looking backwards at its once-great past and fighting change instead of leading it. That must change.
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