Rethinking the Grid

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Rethinking the Grid – How Our Changing Electrical System Will Impact the Ways We Produce, Distribute, and Use Energy.
BuildingEnergy 15’s Opening Keynote Session, March 3rd, Boston, MA.

by Fred Unger

A few months ago, BuildingEnergy 15 conference chair Matt Root asked Stephan Wollenburg, Carter Wall and me to organize what we hope will be an inspiring opening plenary forum for BuildingEnergy 15: “Rethinking the Grid – how our changing electrical system will impact the ways we produce, distribute and use energy“

Our plenary speakers are among the most thoughtful people in the electricity arena today:

Karl Rabago, Executive Director at the Pace Law School Center for Energy and the Environment, is a creative and passionate advocate for clean energy policy, with a background in the private sector, government and military. He has served as a Texas utility commissioner, deputy assistant secretary at the US Department of Energy and managing director at the Rocky Mountain Institute, among other roles.

Mary Powell, CEO of Green Mountain Power, has turned her company into arguably the most clean energy friendly utility in the nation. She also transformed the company into the first B Corp utility in the world, independently certified to meet rigorous standards of social and environmental performance, accountability and transparency. The company has also grown impressively under her leadership.

Ron Binz is a utility policy consultant today after a successful stint advancing clean energy policies as the chair of the Colorado Utility Commission. Ron was nominated by President Obama to chair the Federal Energy Regulatory Commission, but his nomination was aggressively opposed by the coal industry and senators who expected he would be too friendly to renewables and energy efficiency.

After more than a century of relative stability, today the utility industry faces more change, risk and challenges than at any time in its history. We’ll explore how the changing electrical distribution system will impact the ways we all use energy. We’ll explore the complex implications from affordable viable electric cars, air source heat pumps and other transformative uses for electricity, coming at the same time that major coal, oil and nuclear generating plants are being retired.  Most importantly, we’ll explore the technology and policy solutions evolving to enable a more reliable, resilient, environmentally responsible and affordable electricity grid.

For the architects, builders and building owners in the audience, we’ll explore how emerging realities will change the way your buildings interact with the grid, not only as consumers, but also supplying energy, load balancing and other services to the grid.  On-site generation and building based electrical storage will have significant impacts on building design and provide both utility cost savings and revenue generating opportunities.  Emerging changes in policy will impact the buildings NESEA members are building today.

Rate reforms allowing for options like real time retail pricing, grid modernization including smart metering and advanced communication technology, and other fundamental changes will transform the traditional utility business model and energy markets, while making the services NESEA members have to offer far more valuable.

A clear vision for the 21st Century energy system can create massive opportunities for distributed generation, storage, demand response and other new services and businesses. Enabling those solutions will flatten our electric load curve, drop peak rates and reduce the need for new transmission investment. All that, in turn, will lower electricity costs for ratepayers and reduce adverse environmental impacts from the utility industry that today is the most wasteful energy sector in our economy.

Unconstrained opportunity for distributed energy resources, more dependable profits for utilities, more reliable electrical service, lower costs for ratepayers, and more effective support for low-income households can all result from policy changes that should eventually unite current day energy policy adversaries with a new shared vision. But getting there won’t be easy and everyone does not yet share that same vision.

I look forward to our NESEA community gathering for what promises to be an interesting opening for the conference. If the forum inspires you to learn more, the plenary speakers will be joining us in a follow up session called “Rethinking the Grid – Q & A”, in which they will dig deeper into the conversation and answer your questions about our emerging energy future.

For registration and more info about BuildingEnergy 15 visit:

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Reducing Costs and Risks for Ratepayers

The Providence Journal just published an op-ed I wrote regarding how long term contracts for clean energy can help reduce costs and risks for electric utility ratepayers.

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Calculating the Value of Solar Energy for Ratepayers

Recently, I testified at the Rhode Island Statehouse regarding the impact of the state’s Distributed Generation Contracts law on ratepayers. In preparing the testimony, I realized it is important for legislators to have a tool to estimate those impacts under a variety of scenarios. I decided to create that tool for them, which is attached here:

Unger – Value of RI Solar

This isn’t intended to replace a full economic impact study, and actually significantly underestimates the positive benefit of solar for ratepayers. But it gives a general sense that cab hopefully help better inform policy related to renewable energy and utility regulation. Try it out.

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Addressing The Worlds Most Vexing Problems

Interesting TED talk about how to reverse desertification and climate change, while ending hunger and social chaos, all using the exact opposite solutions that I was taught studying environmental studies in college – with increased herds of cattle, sheep and goats.

This is a really amazing presentation that provides an excitingly simple solution to the worlds most vexing challenges.

The immediate challenge to its implementation that came to my mind is around fencing, property boundaries, and all the complexities of ownership.


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March 9, 2013 · 9:34 am

Doing Math vs Political Posturing on Federal Budgets

With all the noise about federal budgets, sequesters, debt ceilings and taxes, its sometimes hard to figure out what’s real.

So I spent a little time doing some research using government statistics and basic math this evening. The results are shown on the spreadsheet below comparing various economic factors.

In summary, between 1967 and 2011:

Population growth was 159% and inflation was 673%, which combine to create a normalized growth basis of 1,071%.

Gross Domestic Product grew 168% relative to normalized growth.

Average  household income increased 119% relative to inflation but only 45% relative to GDP growth.

The official poverty level stayed flat relative to inflation but increased only 38% relative to GDP growth, while the number of people living below the poverty line increased 105% relative to population growth.

Federal spending grew 214% relative to normalized growth  and grew 127% relative to GDP growth.

The deficit portion of federal spending has increased 1,411% relative to normalized growth. In dollars it has increased 15,112%.

Our federal debt has increased 4,337%.

So what conclusions can be drawn from those numbers?

1)   Government spending has clearly grown far more than the economy, inflation, population or average family incomes.

2) Our economy is growing faster than normalized growth expectations so productivity is improving.  That’s good news. Our society has extra resources to solve problems. We shouldn’t have to borrow.

3)   The disparity between GDP growth and average household income growth indicates significant wealth is accumulating that is not accruing to the average household, thus wealth disparities are clearly increasing.

4)   Growth in average household income has been better than inflation, but the average household income data shown is presumably skewed by the increasing share of  income accruing to wealthy households.  Average middle class family incomes are likely holding steady or improving a bit, but that data is hard to tease out of the statistics.

5)   Poverty is getting worse in America. Significantly increased government spending has not helped at all to alleviate poverty and likely hasn’t done much good for average middle class households either.

6)   It appears that there is plenty of room to cut federal spending to be more in line with normalized growth.

7)   Growth in federal deficit spending and debt is dangerously unsustainable and needs to be addressed.

The “tax the rich” vs “cut the budget” rhetoric in Washington is not solving the urgent problem we have of getting the deficit and debt under control. We need to do both.

What the statistics don’t show is there are smart ways and stupid ways to implement both spending cuts and tax revenue increases. There are plenty of programs and entire federal departments that can be selectively eliminated because they frankly aren’t doing anyone any good except the government employees who take home paychecks. Raising tax rates is not the answer when the byzantine tax code is riddled with loopholes for the wealthy to exploit. We should be eliminating all tax loopholes, eliminating the corporate tax altogether and then treating capital gains, dividend income, carried interest and all the other specially favored income categories of the wealthy as regular income taxed at regular rates.


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Kiesling On Thinking About Complex Systems And Economic Liberty

Lynne Kiesling recently wrote a great overview of the elegant complexity and beauty of self organizing free markets. Read it here.

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Encouraging Jobs That Make Things

Back in April, Stephen Moore wrote about the fundamental economic challenge facing our nation. His title and subtitle explain the core issues:

We’ve Become a Nation of Takers, Not Makers
More Americans work for the government than in manufacturing, farming, fishing, forestry, mining and utilities combined.

It isn’t just government. I’ve been told that here in Rhode Island there are more people working in nonprofit organizations than for profit businesses.  We should also consider all the folks collecting social security, welfare or one form or another of government support, as well as all the businesses that subsist on government contracts and subsidies. And numerous private sector jobs are obviously questionable in terms of adding fundamental value to our society.  It is truly amazing how many folks our society has to support that aren’t engaged at all in producing the goods we all consume relative to those who do help grow and make things.

Of course our domestic makers don’t do it alone. Makers in other countries are providing most of the manufactured goods we consume in the US as well as many of the raw materials. And we are paying for it all with massive unsustainable levels of private and public debt that will eventually have to be repaid through our own productivity as a society.

We live in an interconnected global economy and as a nation we have to produce goods and services for trade in order to pay for the goods and services we import and consume.  Because our nation consumes so much more than we produce, we are experiencing unfortunate realities like real wages stagnating for the last forty years and declining recently.

I do not mean these comments to question or negate the value of the work of people who work in government, in non-profits or in industries outside those that directly produce the goods we consume. Nor do I suggest that we should be less compassionate to retired folks or others who depend on government support. These days I am working in the heavily subsidized field of solar energy and would definitely have to be counted as a taker myself when it comes to our national balance of trade.

We need to recognize that our economy is in the worse crisis since the 1930’s because the path we have been on is completely unrealistic and unsustainable.  We have to be more self sufficient as a nation and create more value for export. We can’t possibly keep borrowing to fund consumption without increasing our production. We simply can’t afford to support so many people in our society who don’t help make all the stuff we consume.  If we want a healthy economy, we need far more makers.

Moore’s comments on productivity are particularly important. His conclusion might be help point the way toward meaningful solutions in the unemployment debate that politicians in Washington are poised to enter next week:

President Obama says we have to retool our economy to “win the future.” The only way to do that is to grow the economy that makes things, not the sector that takes things.

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