Tag: Legislation

An unlikely love story: Alaska and renewable energy

Agree with it or not, Sarah Palin’s hymn to the oil industry, “drill baby drill” was one of the 2009 election’s catchiest mantras. Surprising to find, then, that Palin is a fan of renewable energy, according to a recent New York Times report. Furthermore, Alaska, the second-largest oil producing state after Texas, is fertile ground for renewable energy. Fuel prices there are high. Strong winds support a growing wind power industry. Palin wants 50 percent of the state’s electricity to come from hydro power by 2025.

This doesn’t actually jibe with Alaska’s image as the oil and gas industry’s treasured love child, but there’s more to this story than irony. It speaks to why renewable energy’s time might actually have arrived. For real, this time, and not like the giant renewable energy head fake of the 1970s.

That was the era when the Gulf oil states started flicking the spigot on and off according to how many tricked out 747s the Saudi royal family needed, or how mad they were at Washington over U.S. Middle East policy. Gas efficient cars went mainstream. The first roof-mounted solar arrays appeared. Utilities invested in fuel cell development. Jimmy Carter put solar panels on the White House roof. Schools and other public buildings were designed using passive solar heating and cooling techniques. Then the price of sweet crude dropped into the cellar, Ronald Reagan ripped out the White House solar panels, and the renewable energy industry turned back into a hippie pipe dream.

So renewable energy is hot again, but why won’t it suffer the same fate it did when bell bottoms were in style? After all, we live in a market economy. No matter how good an idea renewable energy is, the market still favors fossil fuels. When the price of oil falls, the power that renewable energy sources produce is too expensive to compete.

The difference between now and the ‘70s is that the oil’s cost dynamics are changing permanently. China, India, and a host of developing economies are competing with the U.S. in international oil markets. Barring a complete collapse of those countries’ industrialization programs, that competition will keep oil prices at steadily higher levels. Also, the era of cheaply extracted oil is waning. An increasingly large percentage of oil reserves are hard to get out of the ground, and the prices will reflect the greater effort and new technology to bring it to market.

Rural Alaska is a laboratory for this dynamic. Market forces, acting through the price of shipping and the per-gallon price of the fuel, conspire to make fuel-generated electricity outrageously expensive in rural Alaska – five to ten times higher than in the lower 48. If the price of oil were lower, the market might be able to absorb the high delivery costs. But the price isn’t low enough, and here’s betting that it never will be. That means the local market conditions in rural Alaska will permanently favor renewables. “Despite high installation costs and the need for cold-weather engineering,” the Times reported, “wind turbines can often produce power at a lower cost than diesel generators by eliminating the need for fuel.”

How long before the base price of oil rises enough to make wind and solar the economic choice in rural Wyoming, the Dakotas, Texas, California, etc.? A long time off, maybe. But the fact that it is already happening in Alaska is not an isolated fluke. It’s the first sign that the economic case for renewable energy is growing strong enough to endure the next temporary decline in oil prices.

A broader PR palette now critical to move clean technology industry forward

Clean technology investment was a major platform for Obama during his campaign.

He said, “My energy plan will put $150 billion over 10 years into establishing a green energy sector that will create up to 5 million new jobs over the next two decades.” He promised to create a Clean Technologies Venture Capital Fund, hoping to invest $10 billion per year into this fund for five years. Obama also promised to double science and research funding for clean-energy projects, including those making use of biomass, solar and wind resources. This was such an encouraging vision for our industry.

But the encouraging news is that this wasn’t campaign rhetoric.

Yesterday, President Obama boldly acted on fuel efficiency and global warming. He urged passage of the $825 billion economic stimulus package in the House and Senate. Those bills include billions for investment in renewable energy, conservation and an improved electric grid. He said, “No single issue is as fundamental to our future as energy.”

There’s never been a more critical time for authentic, persuasive, pragmatic, inspired communications. But does “traditional PR” play within this unfolding drama? Are messaging, thought leadership and media relations the core PR elements needed to affect the necessary change?

No, certainly not.

The clean technology industry is a complex ecosystem that includes economics, politics and public policy. Clean technology companies must continually balance these considerations. The industry also has a vibrant moral dimension – a making the world a better place element – that adds legitimacy, scope, involvement and urgency.

In this dicey economic time, the clean technology industry needs even greater support from investors, public policy makers and the public itself to blossom. To achieve the progress President Obama envisions, we must think, plan and act holistically from a communications perspective as the clean tech industry develops and markets products and solutions that ultimately enable us to live cleaner, greener, better lives.

Thankfully, public relations now represents a much wider palette. It should – and must – embrace a variety of strategic areas including thought leadership, public advocacy, social media, crisis communications, ethnography, employee communications, corporate social responsibility, multi-cultural relations, healthcare, change management and financial communications.

To name a few.

Depending on the clean tech company, product/service, market segment and challenges faced, many of these communications ingredients must be thoughtfully weighed, integrated and acted upon, often in the same relative timeframe. Again and again and again.

Yes, these are complex, critical, consuming, highly charged challenges for communications professionals.
But what a historic moment to shape a societal/global movement that will continue to grow in urgency as tough times morph … into stable times … and better times.

Clean technology experts bullish for change @ Harvard Club event

There was lots of passion on display at Tuesday’s Clean Technology event at the Harvard Club (disclosure: sponsored by Beaupre and Brodeur Partners).

Marc Gunther, Fortune magazine’s senior writer and sustainability expert opened the session with a talk called “The clean technology revolution: bigger than the Internet?” He said five pivotal forces will make this a reality: science; scale; stimulus, security and generational change. Here are some Gunther sound bites:

  • “Cleantech hasn’t had its Netscape moment yet.”
  • “The science is so compelling it’s hard to turn back.”
  • “This has become personal to them (CEOs). They are, on some level, thinking about their legacies – what kind of world they’re leaving for their children and grandchildren.”
  • “This is the growth sector for America.”

Gunther moderated a panel of frightful cleantech brainpower: Scott Clavenna, CEO of Greentech Media; Nick d’Arbeloff, Executive Director of the N.E. Clean Energy Council; William Huss, adjunct lecturer at Babson and former COO at XENERGY; Paul Maeder, General Partner, Highland Capital Partners.

Highlights from the panelists:

  • The pace of change isn’t fast enough, but New England is off to “a fantastic start.”
  • If Obama is elected, it will be positive for clean technology, “We’ll look back in six months and be amazed.”
  • The revolution will occur via 100,000 “small garages” vs. a Manhattan Project-like effort.
  • We’ll need unprecedented private sector creativity and public sector political power working together like they’ve never done before.
  • Investment and growth for cleantech is markedly different vs. the software industry.
  • The VC industry is ripe for upheaval; a shakeout is looming.

Cleantech VC guru Paul Maeder said “We’re going to have to look at new models of cooperation or we’ll all go the way of the duckbill platypus.”

Nick d’Arbeloff said “Government and policy played no role in the information technology boom, but energy is fundamentally different. The only way to solve our energy problems is to unleash the free market on them, but we also need a government policy foundation.”

Clean technology media pioneer Scott Clavenna said “We lost eight critical years. We need leadership from the top, at the White House. We need our (new) President to say, “This is what we’re going to do” and then stick with it. It’s time for a bold step.”

Former XENERGY COO and current Babson Adjunct Lecturer Bill Huss said companies developing energy efficiency technologies “can’t find people fast enough to hire into the industry.”

Fortune’s Gunther cited several examples illustrating how business is capable of playing a critical role in affecting societal change. “Despite the well-known flaws and problems with corporate America, we can see big and certainly small companies being significant drivers of change.”

Gunther should know. He’s interviewed the likes of Jeff Immelt and Michael Dell and wrote the September 29 cover piece about Hank Paulson. He’s a captivating storyteller, weaving fascinating tales about the impact of business on society. Check out his blog at www.marcgunther.com.

Nation’s first greenhouse gas cap-and-trade auction launches

In case you missed it (most people did), yesterday saw the launch of the nation’s first mandatory cap-and-trade auction for carbon emission credits … with little fanfare.

Ten northeastern states, including our little Granite, will let polluters bid on a limited amount CO2 allowances – 188 million tons of carbon emissions annually, to be exact. The State Regional Greenhouse Gas Initiative, or RGGI (pronounced ‘Reggie’), will cap emissions for 233 power plants, with a goal of reducing the cap an additional 10% by 2018.

But already the system has its critics. After a tepid first day of trading, the Wall Street Journal took a skeptical view of the program’s long-term viability. The New York Times pointed out how emissions cap will have little impact at first because it’s based on overestimates of CO2 output. And others cry that it’s no more than a tax in green clothing that will raise electric rates (which it probably will, at first, but lower over the long term).

But the critics are shortsighted. What’s more more important is that a real, free market-based cap-and-trade system for global warming reduction is now in place. There’s a platform and regulatory mandate for cutting greenhouse gasses that didn’t exist before. It’s a build-it-and-they-will-come opportunity. It’s a good first step.

Call me a green romantic. I know RGGI won’t save the world right away, but at least we’re finally giving power companies financial incentives to modernize plants, reduce emissions and explore alternative energy approaches. The program freezes greenhouse gases from power plants at current levels, and promises significant reductions long term.