Finding Value amidst the High Ideals of a Net Zero Future: Keeping Affordability top of Mind
You can always talk about it tomorrow.
The Year 2050 is still nearly 10,000 days away. Yes, the climate crisis is a strong, present motivator, but that’s a long time to try and keep a sense of urgency going intensely.
Not true, many climate believers say. Keep trying and start today, those on the front lines of making the energy transition happen have to tell themselves each and every day. Don't let down your guard.
Indeed, so much of the discussion at the 31st annual Accenture International Utilities and Energy Conference, held early this month in Los Angeles, focused on the future and the need for action now. It included many of Accenture’s clients and partners, energy transition spinoffs and startups and the U.S. Department of Energy.
And yes, as another story from the IUEC noted here on EnergyTech, even faraway deadlines have a way of getting here fast. The key challenge along the way is maintaining an open line of understanding resistance while lining up the evidence of what needs to happen and why it needs to happen.
And always remember that good intentions don’t pay the bills. Customers do.
“Affordability is No. 1 on their minds,” Retha Hunsicker, vice president, customer experience design and solutions, at North Carolina-based utility Duke Energy. “We’ve got to bring customers along this evolution with us. We need to make sure it’s customer-centered information and bring employees along, too. We don’t want to leave them behind.”
Creating the biggest grid and energy transformation since the invention of electricity, the automobile and power generation is a full-on family affair, regular family reunion and 30-year family project all in one. Every stakeholder along the timeline needs to buy in, whether they are politicians, regulators, customers or employees, and whether it’s leading to power from the sun, wind, hydrogen atoms, nuclear reactions, battery storage, transportation electrification and carbon capture.
There’s really no and/or here. The energy transition and road to a true Net Zero will likely require all of the above and as soon as humanly possible. How we get there, however, requires some creativity, persuasion, information and maybe even compromise.
Sanda Tuzlic, global connected energy and e-mobility lead at Accenture, noted that it’s all about stimulating people to think forward and image the future of actionable opportunities. Engage and empower. Recognize the human scale is key to selling the message.
“Eventually they start thinking differently about the approach to mobility,” Tuzlic pointed out, including why long-held notions about automobile ownership and commute may not be all that right.
“I think it all starts with building trust to have an open collaboration,” she added, with that applying to both individual customers and businesses. “Companies need to be open to that, even if they are competitors.
Utilities, for example, know they are on the clock to turn policies into action when it comes decarbonization and the energy transition. They also are tasked with ensuring resiliency as much as sustainability. They must communicate early and often and expect their partners and customers to do the same.
“You can’t tell me you want to electrify everything and bring me in at the 11th hour to put in your system,” said Calvin Butler, CEO of electric transmission holding company Exelon Corp.
The nearby Ports of Los Angeles and Long Beach, two of the busiest and largest seaports in the world, certainly have tremendous ongoing work for electrification and clean energy shifts, from diesel to battery-powered yard vehicles or manufacturing decarbonization utilizing future hydrogen production.
And inhabiting most of that coastal industrial footprint are businesses which must see a rate of return or efficiency on that investment. The Port of Los Angeles continually breaks its own records for containerized cargo volume, a profitable and challenging amount of traffic when it comes to also investing in expensive decarbonization efforts.
“We’ve created this aspirational goal but just creating it doesn’t make it happen,” said Port of Los Angeles’ Mike Galvin, whose title is director of waterfront and commercial real estate, but real job now includes making the energy transition happen there.
“To the tenant these are all just costs,” he pointed out, and those businesspeople don’t have unlimited wallets so they need as much help as possible in federal, public and private investment and incentivization as makes sense. It takes huge investment to get equipment out there which allows a shift from fossil fuels to electric or H2-fueled capabilities.
The equipment needs to get out there to be tested and confirmed as functional, Galvin added. These tools have operational comparability to diesel-powered but perhaps there are only five pieces available when they need 50.
“There’s a lot of people on the sidelines waiting to see what happens,” Galvin said. “Many are small companies, and they don’t know where the fuel is going to come from. We just need to open the conversation and don’t have to be strategic about it.”
More from High-Level Viewpoints at Accenture IUEC 2023 in Los Angeles
Check out our latest Newsletter for all sides of the C&I Energy Transition
Blunt talk is best because high ideals and futurist notions are truly abstractions to an engineer, machinist or budget maker for a commercial fleet operator wondering why he or she could convert the Class 8s to battery-electric of hydrogen fuel cell.
“To get a fleet owner board they want to know about costs—Show me the money, right!” Accenture’s Tuzlic said.
Affordability never goes out of style, like the joy of a smooth ride.
“Fleet decarbonization for fleet owners—it’s a huge transformation,” Tuzlic acknowledged. That’s true for everyone down the line, she added. “There’s a lot of complexity... It’s not just the utilities (supplying the power) but grid infrastructure, the supply of vehicles and the supply of charging points. And let's not forget about drivers themselves and resistance to change.
“There’s a lot of to be managed there,” she said.
The goals are in a state of constant management, so some can be put off tomorrow. The conversations have to start today, because they will be ever evolving.
“I think the level of unprecedented change is only going to accelerate,” Jimmy Etheredge, CEO of North America at Accenture, predicted. “In two years, we’ll be talking about something we’re not dealing with right now.”
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(Rod Walton, senior editor for EnergyTech, is a 15-year veteran of covering the energy industry both as a newspaper and trade journalist. He can be reached at [email protected]).
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