Fork in the Road

“Change does not occur at the center.  It occurs at the edges and works its way in.”

                             Ron Powers

“If you come to a fork in the road, take it.”

                             Yogi Berra

I’ll start by postulating that change happens in a democratic society because people want it.  It often happens in spite of institutions that ideally should help it along. 


Think about it.  What is the primary concern of an institution?  To keep doing exactly what it does exactly the same way, that’s what.  Have you noticed a lot of changes in the Catholic Church in recent centuries?  Or in the basic business model of large electric utilities in the century since they began to make money for their shareholders? 

People who want change have two options, and the “obvious” one gets a lot of attention.  If you see a big problem and its bothering you, it’s natural (obvious is probably not the right word) to hope or want a powerful organization to use its capacity to solve it.  This rarely works, because big organizations, including and especially our national and state governments, already have plenty of problems to work on.  They already outsource most of their problems to smaller organizations.

Ironically, because most of us have a gift for the obvious, there is an ever expanding cadre of large organizations making a good living trying to make the obvious option work.  Associations, foundations, think tanks, you name it.  A lot of money and intellectual capital in play.  We need all of this, and it lays essential groundwork for governments to follow where their citizens are leading.  But we also need to remember that policy does not create change.  Rather change drives policy.  We need to ask where change comes from.

My answer is it happens every day, in people’s lives, in communities, in the bowels of our private sector.  We are curious.  We try things.  Companies have problems.  They solve them.  They have no choice. 

Why do I bring this up?  Well, our appetite for energy causes problems.  Big problems we debate endlessly.  We would like them solved.  We don’t think we can solve them ourselves.  Yes, we can stop being part of a particular problem.  Often easier said than done - takes both time and money, not to mention initiative - so we salve our consciences by supporting the organizations that can get a hearing with big institutions…and/or  take them to court.

What about the non-obvious option?  Trying to solve a big problem all by yourself brings to mind the metaphor of tilting windmills.  Is there actually a non-institutional solution to the problem of pent up demand for change?  What does work?

Well, what works is to start.  Have a goal.  Make a plan.  Enlist allies.  Commit.  Do the work.  Have fun.  I’ll share some examples in later blogs.

To focus the above on our energy problems, I’ll share a poignant observation from a couple of true solar pioneers.  Aden and Marjorie Meinel advocated effectively for solar power at a pivotal time in the early 70s when almost no one else had the foggiest idea what solar energy was.  They were pragmatic, technically grounded visionaries.  They discounted the notion of solar energy as a means to individual energy independence.  In modern parlance they were fans of big solar power plants, not stand-alone rooftop systems.  They said voluntarily leaving the utility would be like taking to the lifeboats when the big ship was doing just fine.  As a newly minted utility employee at the time, I thought they had a pretty good point.

I still do, but we can more accurately pose the options now that we have some experience.  Net metering might not have occurred to the Meinels.  But it has some traction now.  People can now save money by having solar electricity generated on their roofs, but they are still connected in a way that uses the grid as a sort of big virtual battery.  Hence, a certain level of once and future utility industry angst. 

For example, the business section of today’s newspaper reported that “some power companies are proposing an extra fee for solar customers.1  Others are trying to roll back or block programs that allow those customers to trade the solar power they generate on sunny days for power they need from the grid during other times.  (They) are afraid they will lose so many customers – and so much revenue – that utilities won’t be able to afford to build and maintain the grid.”

Not a new issue.  Over a few decades of working for and with electric utilities, I’ve come to question the ostensibly reasonable premise that utilities, to say nothing of governments, will do what we want them to do regarding solar energy.  I’ve never been a fan of forcing people or organizations to do what they seem reluctant to do, knowing from experience that good things don’t happen unless the relevant hearts and minds are properly aligned.  I’ve watched utilities surreptitiously and with exemplary persistence throw up roadblocks to solar energy.  For decades.  They are not going to suddenly stop.  They cover this behavior by talking up environmental stewardship.  It’s seductive.  Plus their employees are about as close to the salt of the earth as people come.  However, their senior executives focus on the business as usual bottom line.  Or is it bottom line business as usual? 

Where does all this lead?

It seems to me to be leading to a fork in the road, thanks to the unsurprising fact that relevant institutions are highly likely to continue to behave like institutions. 

We’ve passed a tipping point, in the solar and wind industries, and there are more ahead.  The result of the first tipping point is a shift in the relative political and economic strength of the utility industry and the solar industry.  The issue of continuing solar electricity deployment will be worked out in state and national political and regulatory forums with these two industries picking up the tab.

The almost inevitable result will be a policy patchwork reflecting who has the votes where.  The risk is that some extremely important and counter-intuitive technical and economic subtleties will be missed in a more or less purely political process.  Net metering makes both current and long term economic sense for the public and society.  It is also a transformational first step on a longer evolutionary path to solving very daunting societal and global problems.  The numbers bear this out, but they can (and sadly, will) be fudged.  I’ll take these issues up in future issues of IRESN Insights.

The fork in the road ahead is well enough explained in a couple recent quotes from credible and well informed sources.  They speak for themselves and are included below.  I agree with the sense of the quotes, with the caveat that none of us knows exactly how far down the road we have yet to go to reach the fork.  I’m betting we get to it before our institutions are properly prepared to follow us down the road we choose, but I hope otherwise.

-- Gerry Braun

©2013 The IRES Network

Will utilities lead, follow, push back, or perish? With increasing levels of renewables, the business models and revenue streams of many existing energy companies are coming under stress. How will existing energy companies respond to that stress? Some utilities simply may no longer be viable, said one expert. Many experts believed utilities would rise to the challenge. However, not all were certain that utilities would lead.”

Renewables Global Futures Report, 2013, page 34

"The business model, the product delivery model that we use was developed in the 1930s. Show me another industry that's still working like the 1930s…I think what we're seeing in our industry is that we need to make that jump to being more an information technology based industry, like the telephone industry did 25 years ago."

David Crane, CEO of NRG Energy

“The individual homeowner should be able to tie a machine to their natural gas line and tie that with solar on the roof and suddenly they can say to the transmission-distribution company, ‘Disconnect that line.’”

David Crane, CEO of NRG Energy

[1] Sacramento Bee, October 2, 2013, page B6  

Crane says that of all the changes facing the electric utility industry, cheap natural gas, distributed renewable energy and deregulation are conspiring to forever change the way utilities do business.  Crane told Bloomberg BusinessWeek that customer adoption of distributed generation capacity, including small wind turbines and rooftop solar energy, will create a vicious cycle where more and more remove themselves from the power grid, leading utilities to raise rates on those who remain undefined creating even more incentive to get off the grid.  He concludes that, to modernize itself, the electric power industry must empower end users to have more control over how they get their power, who they buy it from and how they use it.