The National Commission on Energy Policy (NCEP), part of the Bipartisan Policy Center, a think tank focused on national challenges, issued a study from the Task Force on America’s Future Energy Jobs that highlights the magnitude of the challenges we face as we transition to the future Smart Grid.  According to the report summary, “transforming our nation’s energy systems represents an enormous undertaking.  It will require not only new, low-carbon technologies and systems, but people with the expertise to create those technologies and to plan, design, build, operate, and maintain those technologies and systems.”  In other words, it’s time to roll up our sleeves and put America back to work.

There are other reports and plenty of anecdotal evidence that highlight the fact that the Smart Grid offers numerous job opportunities.  In some cases, these opportunities are replacements of existing positions vacated by a retiring workforce.  Back in 2005, the American Public Power Association (APPA), which represents municipal power entities released a report that identified the significant losses that functions such as electricians, line workers, equipment installers, maintenance workers, plumbers, pipefitters, heating/ventilation/air conditioning (HVAC) technicians and construction workers would incur due to natural workforce attrition or lack of educational opportunities.  These are traditional jobs, but will have to accommodate new Smart Grid technologies and services.  For instance, HVAC technicians may need new training as more buildings migrate to continuous commissioning to maintain optimized energy efficiency.   Other functional changes in meter operations and outage management will trigger revisions to job definitions and training.

The Society for Human Resource Management has been discussing the workforce attrition topic to initiate and accelerate utility workforce planning, and this article offers some interesting observations.  Among them, the recent economic downturn may have temporarily postponed some retirement timelines, but as many as 40% of the 400,000 electric utility workers and 106,000 natural gas workers may retire by 2013.  A significant number of these jobs do not require a college degree, but will require a high school degree and specialized training. 

The GridWise Alliance recently released a report titled The US Smart Grid Revolution: Smart Grid Workforce Trends 2011.   This report reiterates the needs to replace retiring utility resources as well as fill entirely new roles created by the technology and service suppliers to utilities.  Smart Grid enabling technologies are creating promising hiring activity in information and communications technologies (ICT) solution providers as well as traditional utility vendors.  These jobs include skill sets in telecommunications, IT, cyber security operations, data management, project and program management, customer service, and administration.   New roles in utilities, like the Consumer Engagement Manager featured in my previous blog will be created to address the changing landscape of utility priorities and job skills in consumer relationships.

SmartGridCareers.com is a website that specializes in assisting Smart Grid employers and job seekers and helps build the knowledge, skills, and information for effective performance through a variety of resources.   Their services for job seekers include job listings by company and category, and screening services for employers.  Right now they are running a survey to determine what information job seekers need about the Smart Grid to find their best fit in this growth area.  Check out the pop up box on their home page to complete the survey. 

The broad scope of available white collar and blue collar Smart Grid jobs is welcome news for our struggling economy.  Government investment in a 21^st century electrical infrastructure can do even more to put unemployed and underemployed Americans back to work.  So why are our political leaders reluctant to invest in infrastructure like Smart Grid projects?  It’s a good question to pose to them.  Failure to invest in the Smart Grid is a failure to invest in us, our futures, and our national economic and energy security. 

This is the energy reality gap in America, and it’s time for us to close that gap and focus more public and private funding in Smart Grid technologies.  But like Charlie Sheen, many live in an alternate reality where capitalism means the subsidization of mature, profitable oil industries; harmful external costs like pollution to the atmosphere, biosphere, hydrosphere and geosphere should be borne by taxpayers and not the businesses that create them; and we’ll never run out of oil.    

The Smart Grid can change our energy reality in two critical aspects.  First, it integrates renewable domestic energy sources like wind, solar, and geothermal into our electrical supply.   While very little of our electricity is sourced from oil, around 90% of our transportation system runs on it.  Electrification of our transportation system puts energy reliance on domestic energy sources that are not impacted by global political events, and we’ll reduce our trade deficit as we reduce energy imports.  Another benefit is the reduction in Greenhouse gas (GHG) emissions through use of clean renewables.

Second, the Smart Grid adds bi-directional flow of communications and electricity, which disrupts the entire transportation infrastructure in very interesting ways.  Consider that smart charging, which manages the timing, pace, and extent of charging loads of electric vehicles (EVs), is only possible in Smart Grid-enabled networks.  Smart charging lets drivers charge from the grid when demand and prices for electricity are at their lowest, as well as charging up the grid by selling back electricity during peak times.  When is the last time an oil company offered that sort of give and take to consumers?

A strong commitment from the government in increased and long-term funding of the Department of Energy’s Advanced Research Projects Agency – Energy (ARPA-E) and other investment channels can speed the development and deployment of Smart Grid technologies that electrify our transportation infrastructure and give us, at last, energy security that doesn’t require the US military in overseas adventures.  Last week ARPA-E held the Energy Innovation Summit in Washington DC to showcase the progress of investments made in innovative energy technologies.  That’s a great start, but we need to continue the federal funding commitments and focus on game-changing technologies to accelerate progress, as well as increase private sector activity. 

Would political turmoil in Libya or the Middle East have an effect on the cost of electricity that is generated by renewables within our borders?  No.  Would we be shocked by dramatic price increases every time we charge our cars?  No.  Think about that next time you fill up your gas tank.  It’s time to ask your elected representatives these questions, and why they are still subsidizing the past (oil) instead of investing in the future (electricity).  It’s time to stop emulating Charlie Sheen in our energy policies. 

First they created a public relations disaster with their smart meter rollout, which now has its own term called “the Bakersfield effect”.  PG&E investment in a sensible communications plan and budget could have prevented this problem.  The impacts of the Bakersfield effect are widespread.  Smart meter rollouts in other utilities are delayed or postponed, and each setback hinders realization of their Smart Grid objectives.

Second, PG&E filed a tariff proposal that would reduce their current 5 tier electricity pricing structure to 3 tiers.   Under the current structure, the more energy you use, the higher your rates.   This provides financial incentives for Californians with high bills to seek solutions like solar panels or energy efficiency investments or simple energy conservation behaviors.  The proposed flattening of this program rewards electricity guzzlers at the expense of energy-conscious consumers.  It is akin to asking drivers of gas-sipping cars to subsidize the gas for Hummers.  Solar companies are already on record stating that this tariff change, if approved by the California Public Utilities Commission, would remove financial incentives for many homeowners to add solar generation and thereby defeat two key Smart Grid objectives – increased renewable energy and more active consumer participation. 

And finally, there’s Community Choice Aggregation and Proposition 16.  Community Choice Aggregation (CCA) is available in several states including California and is an interesting market model to accelerate the introduction of renewable energy into the grid and enable more consumer participation to reduce energy use.  The program details vary in each state, but all allow cities or counties to purchase and/or generate electricity for residential and business use within their boundaries. The local investor-owned utility (IOU) delivers electricity through its transmission and distribution network and continues meter reading, billing, and maintenance services.  The customers in the CCA footprint have the ability to opt-out of the CCA program, but why would they?  A CCA arrangement means local community control over energy resources, an increased reliance on renewables, plus a lower overall cost of electricity. 

For example, a local effort in Marin County projects that adoption of a CCA program for the county and its communities would result in:

• Annual average electricity cost savings of $6.8 million spread amongst it customers
• Increased renewable energy utilization to 51% by 2017 or sooner – double the renewable energy resources provided by PG&E in that timeframe
• Improved rate stability for local residents and businesses because a CCA is responsive to its local customers, not to remote shareholders

Prop 16, misleadingly titled the Taxpayer’s Right to Choose Act, is sponsored and funded by PG&E, which is committing up to $35M to the June 8 campaign.   PG&E would like to kill CCA to protect their monopoly powers.   While this effort pleases Goldman Sachs and other Wall Street investors, it has negative impacts for the Smart Grid and us.   First, discouraging community-sourced generation reduces the resiliency of the Smart Grid.  Communities that have their own sources of electricity could contribute electricity or reduce energy consumption during grid disturbances and thus help PG&E continue uninterrupted electricity service to all ratepayers.  Second, it casts a pall on the number of new market models, products, and services that can be introduced, which is one of the seven characteristics of the Smart Grid identified by the Department of Energy (DOE) to accelerate deployment of solutions that improve our energy security and reduce greenhouse gases.  Third, community-based programs that promote energy efficiency and responsive energy reduction programs have unique, localized value propositions to lower community energy costs that could not be matched by a monolithic entity like PG&E.   See this link for more information.

These PG&E actions, if allowed to go forward, are serious obstacles to the deployment of Smart Grid technologies and services, and in turn hinder the ability of this nation to improve our energy security, reduce greenhouse gas emissions, and reduce energy costs for consumers.  Satisfying Wall Street should not (again) be a financial, environmental, and national security cost to American taxpayers, ratepayers, and consumers.

The Smart Grid is definitely global – prompting upwellings of new technology, public and private investment activities, and strategic plans at national and regional levels.  The Smart Grid has different meanings for different audiences, so in a developing country, it may mean an opportunity to design distributed generation configurations for the delivery of electricity to underserved communities.  Developed nations with legacy infrastructure see upgrades such as synchrophasors deployed into transmission systems to deliver wide area situational awareness or new investments in energy storage at distribution substations to function as independent power islands to reduce power outage footprints. 

For the vast majority of consumers though, the Smart Grid is just not part of their daily dinner conversation.  Those of us in the industry are directing a great deal of information loaded with acronyms and industry jargon towards them, but they are not getting the messages about what the Smart Grid means to them or its strategic benefits.  This communications deficit has implications for continued support of government investments.

Zpryme, a research and consulting firm, recently completed a study of governmental investment in the Smart Grid that is available here.  China tops out all government investments with a total of $7.323 Billion spent in 2009.  The USA is second with a total 2009 investment of$7.092 Billion.  From a regional perspective, the Asia/Pacific region has a combined investment of almost $10B, while the EMEA region represents almost $2B.  These investments highlight the fact that policy makers understand there can be winners and losers in the Smart Grid technology race.  And these amounts are merely starting points.  Global investments required in the energy sector for 2003- 2030 are an estimated $16 trillion, according to the International Energy Agency. In Europe alone, some €500 billion worth of investment will be needed to upgrade the electricity transmission and distribution infrastructure.                                 

Policy makers recognize that Smart Grid investments improve energy security and stimulate local economies with new businesses and jobs, along with greenhouse gas emission reductions.   Investment in Smart Grid technologies is a long-term value play, and it will be vitally important that we educate consumers, also known as taxpayers and ratepayers, about the strategic benefits of these investments.  It will be more of a challenge in some countries than others, but the ones that do it well will be the winners in Smart Grid technologies and services exports, and build thriving domestic businesses along with increased energy security. 

The countries that dig deep to invest in game-changing technologies that maximize energy harvests of clean renewables like solar and wind create industries and build employment.  These investments also reduce our dependence on foreign oil, and localize energy purchases.  I’d much rather buy electric energy from my local neighborhood solar generation facility for an electric vehicle than burn gas purchased from some hostile foreign government that funds terrorists.  Intelligent public/private educational programs build needed job skills and intellectual capital that create local centers of excellence for vital Smart Grid technologies.  Even the low-technology, low-hanging fruit of the Smart Grid – energy efficiency programs that retrofit existing housing and building stock to reduce energy costs –  also create jobs that cannot be outsourced. 

Communicating the “security and jobs” benefits of the Smart Grid to consumers goes well beyond the usual “what’s in it for me” messaging about saving money on individual energy bills,  and improving our environment, but must be factored into the story lines to build and maintain taxpayer and ratepayer support for continued Smart Grid investments.