The Energy Dispatch, Part Two ⚡
🧩 The future is modular, incentive-driven, and emerging in 'living labs' 🧪
Climate Solutions // I S S U E # 8 2 // E N E R G Y
Growing up, my three brothers and I spent family vacations snorkeling among schools of colorful fish, spearfishing on coral reefs, and devouring delicious bowls of cracked conch in Little Exuma, Bahamas.
In April, I was able to return to the island for a working vacation; it was the first time almost all of my immediate family managed to gather together here in our adult lives.
My brothers and I have been coming here since we were each around 10 years old, something of a right of passage. As kids, when we weren’t submersed in the water ourselves, I remember spending evenings curled up with a large, thick book with the word “OCEANS” on the cover in white block lettering set against a backdrop of deep blue ocean. I was enchanted by the life teeming below the waves and the nature of tides—the cycles of the natural world. Of course, I still am. I think the time spent exploring the world beneath the waves left an imprint on us all. When it came to honing in on a profession, my eldest brother, Jacob, decided to pursue a career as a commercial diver in the marine construction industry. He’s spent much of the last decade diving to repair seawalls and industrial port docks all across the country.
Now, decades since his first dip into the turquoise waters of the Bahamas, Jacob, 43, is one of a handful of people in the United States with the relevant experience to help deploy the nascent offshore wind industry. And he’s doing just that. With his commercial dive experience combined with time spent serving as 1st Sergeant in the Minnesota National Guard, Jacob now works as a dive operations manager for Michels Corporation. Currently, this role includes overseeing dives subcontracted on the Ørsted offshore wind turbines going in off the Massachusetts coast, to the south of Martha’s Vineyard. It’s one of the first projects of its kind on the East Coast.
This is what the start of the future workforce looks like, a collection of people who cultivated adjacent skills, cobbled them together, and are now being tasked with the most important work of our time.
The question now is where and how the rest of the requisite workforce will be drummed up. It’s also a fact that the green energy technologies we will need in the future don’t yet exist, while some remain commercially unviable for now. Meanwhile, the major infrastructure we invest in today will still be with us decades from now. How will we develop this infrastructure while at the same time making it adaptable to fuel sources or technology that don’t yet exist?
Building on insights into our energy future gleaned at SXSW in the last issue, today we explore some of the answers emerging to these dilemmas.
Let’s get to it,
Cadence Bambenek
Our green energy future will emerge in ‘Living Laboratories’
The coming decade will encompass a rate of infrastructure development this country has not seen since the New Deal. All the while, a roadmap to the future doesn’t exist — yet. Of course, the workforce skilled to match is just as absent.
Sans roadmap and workforce, certain enterprising industry and civic entities are taking the initiative upon themselves to develop both. In this way, the future is emerging in ‘living laboratories’ — industry or civic campuses researching new energy sources, testing their integration into possible workflows, and developing training programs.
“We’re in the process of literally creating [the offshore wind] industry and the workforce to run that industry simultaneously. And the industry is coming online faster than the actual workforce,” says Crystal Pruitt, external affairs lead at Atlantic Shores Offshore Wind. “So you have these individual entities that are taking the initiative to skill themselves.”
In New Jersey, that looks like the Carpenter’s Trade Union buying an entire lake for offshore wind turbine installation dive training, making it the first union-owned and operated commercial dive school in the country.
Far to the north and west, Edmonton International Airport in Edmonton, Canada, has transformed its 7,000 acres into an ‘airport city sustainability campus’—pending onsite solar farm included and all. A not-for-profit entity, the Edmonton airport is testing new sustainable aviation fuels and developing best sustainable aviation industry practices.
“We call ourselves a ‘living lab’,” says Kirsten Poon, business development and investment director for Edmonton International Airport. “We tried to create this platform for innovators and technology companies to come into our ecosystem and to trial and test their technology so that we can speed up that rate of commercialization… where we can look at it from an entire value chain and create that model [with] cross industry collaboration so that we can scale and replicate globally.”
Poon says Edmonton is an ideal candidate to pilot this experimental ecosystem given the airport’s size—being both large enough to be meaningful to international air service, yet also small enough so as to not be disruptive. An airport in Canada is also especially incentivized to create their own ‘living laboratory’. Given Canada’s colder climate, electric-powered flight or on-the-ground vehicles alone simply won’t cut it. Poon says Edmonton is especially interested in hydrogen fuel.
On the municipal level, New York City just last week announced finalized plans to transform Governors Island into a climate hub complete with its own ‘living laboratory’ to develop climate solutions and provide training for green jobs.
The Inflation Reduction Act is giving the energy transition unparalleled momentum
Even though the United States was late to the game in establishing serious energy transition legislation, the Inflation Reduction Act’s incentive-structure design appears to already be surpassing the impact of the European Union’s rules-based approach.
By offering tax incentives for the development of green energy and technologies like hydrogen, sustainable aviation fuel, and electric vehicle production, the United States is cultivating corporate buy-in by incentivizing corporations to invest in the infrastructure and workforce of the future, as well as the research and development of promising technologies.
“This is early days, right?” says Edward Daniels, Shell’s UK-based director of strategy, sustainability and corporate relations. “But my observation is that that incentive-based structure seems to be eliciting far more response.”
Whereas the EU has taken the approach of banning internal combustion engines by a certain date and mandating quotas of hydrogen fuel production, the United States is incentivizing innovation and corporate buy-in to the energy transition by way of the $216 billion in corporate tax credits found in the Inflation Reduction Act (IRA), for activities from carbon capture and storage, to green jobs apprenticeship programs, to hydrogen fuel production.
“I think the Inflation Reduction Act is an absolute world game changer in terms of energy transition,” says Daniels. “It will prime the pump on a number of technologies that are completely fundamental for energy transition.”
In fact, according to Lauren Riley, sustainability director for global environmental affairs for United Airlines, the IRA has already unlocked innovations in sustainable aviation fuels that were dead in the water only last year.
“Just six months ago, some of the conversations we were having with some of these early stage startups looking at alternative fuels… they were not economic. Then comes the Inflation Reduction Act,” says Riley. “All of the sudden, the economics in six months, I swear to you, for some of these investments, have totally shifted. The amount of innovation we’re seeing, the amount of new climate technology coming online, the amount of basic enthusiasm that we’re seeing from the venture side and the startup incubators, it’s just been phenomenal.”
Critics are concerned the IRA incentive-structure is creating an international race to the bottom in a competition for green energy talent and business, and is forcing European countries to adopt similar incentive structures in order to compete. EU officials are concerned the IRA will slow green energy development in the EU. Of particular concern is the IRA’s provisions rewarding manufacturing on U.S. soil, seen as a blow to European-based car manufacturers. Volkswagen, for instance, has already invested $2 billion on an electric vehicle plant in South Carolina.
But by getting this corporate buy-in, the IRA is designed to unlock billions of dollars of additional private capital, which will create momentum for the energy transition necessary to plow ahead, hopefully regardless of which administration might be at the helm in the U.S., says Jason Busch, the executive director of Pacific Ocean Energy Trust.
“When you have large multinational corporations, some of them invested a billion dollars just for the lease—just the right to build the project—when you invest that kind of money, you can bet that they’re going to fight hard to make sure that project gets built,” says Busch.
A modular future is an adaptable and energy efficient future
Eighty percent of a mobile device’s carbon footprint is associated with its initial manufacturing. That means that if you can keep that device in someone’s pocket for an additional three years, as Mark Newton, Head of Corporate Sustainability for Samsung, puts it, you can reduce the device’s carbon footprint by 32X.
In the future, an upgrade to your iPhone or Pixel might look like dropping off your device for an afternoon every few years to swap out the camera for the latest and greatest, instead of the hedonic treadmill of upgrading to the latest device year in and year out.
A modular future like this will be more efficient, reduce waste, and ease the burden on a slim workforce. Modular design will also push some businesses to rethink their relationship with customers.
Ironically enough, at Samsung, one of the companies infamous for opening the Pandora’s box of ‘planned obsolescence’, that looks like pursuing a new business model altogether.
By becoming a more vertically integrated business, Samsung hopes to grow a ‘service as product’ business model, where they are concerned with getting and keeping Samsung devices into customers’ hands, so that those customers can then access Samsung’s library of content or games. This ‘service as product’ approach will allow the tech conglomerate to align their business model with internal sustainability goals.
Modular design thinking will also help us grapple with the fact that the major infrastructure that we invest in today will still be with us decades from now.
Take aviation, for example. “We just announced a purchase from Boeing of more than 700 aircraft,” says Riley of United Airlines. “That existing infrastructure isn’t going anywhere. Those assets are fully baked… If you introduce a solution by which you can actually pull the engine out and put in a lower emitting alternative, you’ve fixed my problem, of, ‘That bird is going to be in the sky for 30 years.’ I think we’re going to see some of those models pop up because that’s what we’re going to need when we think about assets that exist for 30+ years.”
Riley expects these engine swaps to drop the lifecycle emissions of aircrafts by 85 percent immediately.
This “zero-emissions” solution is already in the works. ZeroAvia is a UK-based startup pioneering a hydrogen-electric engine designed to slot right into existing aircrafts. Because the hydrogen-electric engines will be slotted into tried-and-true aircrafts, this modular approach also expedites the timeline to regulatory approval. ZeroAvia, which has been piloting the technology at Edmonton International Airport, is expected to release a commercially viable version as soon as 2024.
Modular design will also help the United States to cope with the workforce shortage. Among home builders, for instance, there’s a growing interest in prefabrication, which not only reliably produces more energy-efficient designs, but where the factory creates a more dependable training environment.
“You talk about workforce, even workforce training, the factory can become the trade school,” says Joseph Wheeler, professor of architecture at Virginia Tech. “It becomes so much more efficient. With prefab, you’re eliminating waste, and you’re able to incorporate all of the newer technologies. It’s better to install them in a factory than out on the field.”
In the years to come, it will be fascinating to see the ways modular design emerges as a solution across industries, and how it can be used to help us adapt as future green technologies come online.
Correction: An earlier version of this article incorrectly said the Edmonton International Airport has an onsite wind farm. This is incorrect. Instead, the airport has plans to begin work on construction of a solar farm later this year. The Edmonton airport also operates as a not-for-profit, not as a non-profit.
You are very welcome. And, of course, that is "too," not "to." Sheesh.
There are lots of quick-hitters here, Ms. Bambenek. Perfect for holding interest, especially looking at the timeline. It is good to see some examples of action beyond the boardroom. (Nice intro, to, Cadence.)