Obama’s Science Article [PDF] is a great read. If you haven’t read it, just click the link to get a pretty good summary of where the climate conversation currently is and where things are heading. The summary for me was;
We have long known, on the basis of a massive scientific record, that the urgency of acting to mitigate climate change is real and cannot be ignored. In recent years, we have also seen that the economic case for action — and against inaction — is just as clear, the business case for clean energy is growing, and the trend toward a cleaner power sector can be sustained regardless of near-term federal policies.
Obama was the first president ever to write an article in Science magazine and he chose a very divisive topic. I don’t care about your politics, as you shouldn’t care about mine, but what I do care about, and think you should care about too, is the uncertainty inherent in us continuing to deal with our planet the way we currently do. When folks say the ‘risk’ of climate change, it gives the impression that we can measure and assign a value to the impact. What I see is uncertainty, as we have no real idea of the scale of the downside impact of our continued actions on our climate. So I choose to work on it. And I recognize that it also represents an opportunity. A big one.
What I see is an opportunity to make a social and economic impact, working in a trillion dollar industry that isn’t going anywhere anytime soon. For a man who’s achieved so much, anything less than making a dent in our energy future would be selling his legacy short. Yes, I’m calling Obama out now he has time on his hands! Here’s why.
- Size of industry: As mentioned, the global energy sector is worth trillions of dollars. According to Mckinsey, the cleantech sector is expected to add a few T’s to that amount. The US just gave $500M to the UN climate change fund, part of a previous commitment. Bill Gates and his buddies have just committed $1bn to cleantech investing with their Breakthrough Ventures Fund. I actually think the size of the commitment is too small. It wouldn’t be out of place for Obama to raise a few more billions for that fund and run it. It brings together his love for entrepreneurship, innovation, technology and community impact.
Image courtesy: Breakthrough Ventures. http://www.b-t.energy/ventures/
2. Interrelatedness of the energy system to other core systems: The energy system is tied to every other major system, i.e. health, food, water, and in the hierarchy of systems might be considered the top dog. Without energy we would not be able to utilize water to convert our food and without food, we have health problems. The reverse is not the case. Quoting the former CEO of the Clinton Foundation,
“The earth’s climate is a system comprised of the subsystems of our atmosphere, our oceans, the land, and human society. “Systems Thinking” views outcomes as the result of the interactions between the various elements of a system and recognizes that systems often contain within them the causes of their own success, and — this is critical — the causes of their own failure. Similarly, “Systems Problems” are problems that have origins in the interactions of the elements of a system, characterized by a high degree of interconnection and interdependence with other variables around them.”
3. Urgency of the situation: The climate is always changing, that is not the point (and why it is called the climate). The point is that scientific evidence points to things happening a lot quicker than it used to. Whether it is caused by humans or not, the pace of change should be considered a problem. The Chinese have a saying ‘The best time to plant a tree was 20 years ago. The second best time is now’.
4. Disruption, innovation and technological possibilities: The level of disruption happening in and to the normally staid energy industry is astonishing. Innovation is moving to the local level with nanogrids -single unit demand and generation of energy — becoming the first option and choice in many parts of the world where infrastructure for power generation has been below requirements but is catching up to consumer needs.
Image courtesy Breakthrough Ventures
The price of solar in non-OECD countries has fallen below wind for the first time ever; this in economies where the price of electricity was above US prices anyway.
Image Courtesy Bloomberg New Energy Finance
5. The Convergence: The main reason, in my opinion, why it is the perfect time for Obama to get into this industry is because of the convergence that is happening between the built environment (building materials that enable the management of energy at a scale that has not been possible up until now), the energy industry (solar prices are finally at level costs with fossil fuels), transportation (Teslas and other electric vehicles are starting to gain some semblance of adoption), technology and software (AI: Google and energy savings at warehouses), the Home and the aware consumer, and skills requirements. What the industry needs now is a combination of evangelists, operators and community developers.
6. The Kids: And if he needs another reason? Obama, like every parent, cares about his children. We are not quite sure how our actions are affecting the planet we’re leaving them with. To bring his skills and clout to bear in the energy industry is one of the only real ways he can impact their future. And since he is a man who also loves to read here is a list of books that will bring him up to speed on the past, present and future of the US power industry, which will serve as a proxy for the global sector.
Books to make Obama (and you) a power industry expert
- The Grid: The Fraying Wires Between Americans and Our Energy Future by Gretchen Bakke: Picked by Bill Gates as one of his favorite books of 2016, this book provides a thorough analysis of the state of the US electricity industry. Written by an anthropologist, it is a thorough study on the culture, technology and development of the US electricity industry.
- Understanding The Electricity Industry by Bob Shiverley and Jon Ferrer: As much a reference book as it is one that you pick up to read straight through. The authors are currently working on an updated edition, taking into consideration the fast changing landscape of the electricity industry.
- Thinking Fast and Slow by Daniel Kahneman: Why have I put a book on decision making here? Because this book provides the most clarity on why we think and make decisions like we do. It would be expected that the rational individual, seeing negative consequences of his actions, would change tack and make decisions that are in his best interest. Not so, says Kahneman, as we are not rational agents but controlled by automatic and thoughtful elements of our cognition that might get things wrong sometimes. It is a must read for anyone who wants to understand humans and impact decision and policy making as we work towards a better energy future.
- Smart Power by Peter Fox Penner: This book dives more into the power industry business models in more detail than most other books I’ve read on this industry. The book also attempts to predict or suggest some new business models for the paradigm shifting changes that the industry is seeing.
- Predictably Irrational by Dan Ariely: After living a little and reading ‘Thinking Fast and Slow’ you’ll agree that we human beings are irrational agents. What Dan Ariely shows in his book is that we are irrational in predictable ways. This is a good thing. It helps us to model the possibilities of human behavior even as we stay irrational; a necessary skill to have as we deal with the conflicting interests of peoples and nations who are all subject to the effects of continued failure to act on climate change.
- Master Switch by Tim Wu: The utility industry tends to be compared to the telecommunications industry. The description gets more apt by the day as digitization of the industry takes place at pace. In ‘Master Switch’ Tim Wu describes how industries become ‘information networks’ and consequently fall to innovation and disruption as they get further along in their ‘lifecycle’. What the book shows is that this process of bundling (big monopolies) and unbundling (upstart startups disrupting the big monopoly) is cyclical. The television and telecommunications experienced these transitions and the book explains how the same will happen to the utility industry.
- Advancing Technology & The Utility Industry: considering the amount of time I’ve spent thinking and working in this industry, I had to include my book on this list. It provides an overview of why technological change has stalled in the utility industry, what technological breakthroughs will have some impact and how the industry (and the people who work within it) should best approach managing the change.
- Colors of Energy: in 36 thoughtful and thought provoking articles, experts from across the world and with varying views on where the future lies for this industry, share their perspectives on what we need to do as a society to ensure that we provide secure, stable and optimally priced energy to humans across the world.
Storm cloud image from Al Gore presentation at SXSW 2015.
With states like Wyoming putting in bills to stop the sale of renewable energy, what the cleantech industry needs right now is someone who has grasped the scope of the problem and has the skills, the clout and the ability to rally people (because we’ll need an army for this) and inspire hope that there is a chance we can turn back the effects we’ve had on climate change. Someone who is doing it, not because of the money, as a CEO of a venture capital funded company might be for example, but for the cause. Obama happens to fit the bill. If he decided to do this, consider this article my job application to join his team!
My team and I provide product marketing to energy and tech companies through Harper Jacobs & utility consulting at Asha Labs. And buy 40 Semi-Obvious (Startup) Lessons. Sign up for my Polymathic Monthly Newsletter here, I guarantee you’ll love it.