How America can revamp its energy infrastructure, recharge its economy and reshape its future by embracing three major green initiatives.
The financial meltdown has rattled the U.S. banking system to its core. The unprecedented increase in the price of oil this summer has wreaked havoc on household budgets. The presidential race has surfaced divisions of class, race and geography among the American people.
But a crisis is a terrible thing to waste. The presidential election taking place next week has the potential to set America on a new path. Embracing three massive opportunities presented by eco-related initiatives will help America move closer toward its goals of achieving energy independence, escaping recession and creating a sustainable lifestyle for its citizens.
1. Rebuild the National Grid.
The current power grid is outdated and inefficient. The majority of power plants are more than 30 years old. The aging infrastructure costs the economy between $25 to $180 billion in outages every year. More than 7 percent of energy was lost due to inefficient transmission and distribution methods in 2007 alone.
The problem stems from the massively complex network of power producers. There are more than 3,100 electric utilities in the country, run by either state or local governments, publicly-owned electric companies, or regional co-ops. That doesn’t include the 2,100 other non-utility power producers that contribute to the grid’s complexity.
The nation has successfully streamlined its infrastructure in the past. Think back to the early part of the 20th century when the automobile went from a play toy of the very rich, to a transportation method for the middle class. The nationwide maze of 75,000 miles worth of streets, country roads and dirt trails were organized into the U.S. Highway System in 1925. In the 1950s, the federal government further modernized the system by funding the construction of major interstates and standardized numbering of the highways. The result was a tremendous improvement in commerce, travel and quality of life.
In the same way that the highway infrastructure was created, the nation must unite to build a new energy infrastructure. A new power grid is needed to allow for distribution of renewable energy sources. The grid needs to leverage digital technology to improve transmission efficiency and enable precise power management by both suppliers and consumers. The result will be a robust, secure, streamlined power distribution system which will help deliver energy independence to the American people.
2. Stimulate the “Green Collar” Economy
Alternative and renewable energy technology have the power to transform the U.S. economy. Creating an energy technology industry would help to solve two of the country’s major problems: an economy in recession and an expensive dependence on foreign oil.
Speaking at the Corporate Eco Forum meeting in September, Google CEO Eric Schmidt underscored the opportunity for energy technology to be an economic engine in the same way that Internet technology was during the last decade. By leveraging the same networks of innovation, technology, funding and talent that helped web-driven businesses to transform business and communication, energy technology will spawn hundreds of new companies and create hundreds of thousands of high-paying jobs in American cities and towns.
However, the green economy does not need to focus exclusively on energy technology. Experts have likened the job creation associated with rebuilding the energy grid to a “green New Deal.” New and established companies alike will tackle the next wave of offerings in the areas of pollution control, water conservation, recycled products, municipal regeneration — and many other areas that will help Americans live more sustainably and cost effectively. These green industries should be rewarded for their innovation and incentivized to prosper.
3. Move to a Sustainable Economy
Building a new energy grid and bringing the “green collar” economy to life will dramatically improve the U.S. economy. But in order to create a truly sustainable economy we need to move away from our current consumption-based economic model. Today, America’s livelihood is measured largely by its Gross Domestic Product (GDP). The only way for the U.S. to show growth is to increase consumption.
The alternative is Bhutan. The country is famous for its “Gross National Happiness” index. Rather than only measuring material consumption, the metric is intended to show Bhutan’s progress on factors such as spiritual, environmental and cultural values. What if the U.S. developed a “Gross Sustainability Index” to better measure our progress towards a eco-conscious future? If we continue to chase growth for growth’s sake, we will ultimately lose the race.
The resolution of the presidential election next week will be an opportunity for a fresh start. The new president should appoint a “Sustainability Czar” to chart a course for the country’s future while keeping an eye on the business, social and environmental impacts of our current actions. The czar should immediately call for a national summit of business leaders, experts and public representatives to evaluate our options and to deploy a strategy that takes advantage of America’s many eco-opportunities.
M.R. Rangaswami is the founder of the Corporate Eco Forum, an organization dedicated to improving eco-strategy at Global 500 companies, and the co-founder of Sand Hill Group, a technology investment and consulting firm located in the San Francisco Bay Area.