POWER May 2022 Intl - 37

COUNTERPOINT
Nick Petschek and Martha Deery
E
Electrification Is the
Sustainable Choice,
but the Transition Is
Not Just Technical
nergy powers everything we do. Where and how we create
it-and how we store and distribute it-is constantly evolving.
One of the most likely evolutions is electrification, which
promises to have a huge impact on our climate and planet.
The case for electrification is simple. Our current climate
crisis, highlighted by the latest Intergovernmental Panel on Climate
Change data, has reached a tipping point. Reports suggest
that electrification of the U.S. economy by 2050 could
reduce greenhouse gas emissions 70%. Electricity is more efficient
for individual and commercial customers, and can eliminate
harmful indoor pollutants that cause cardiovascular and
respiratory issues. With over 40% of electricity today being
generated from renewable, non-fossil fuel sources, electrification
seems the most feasible path to a zero-carbon economy.
If electrification can provide cleaner, safer, more efficient,
sustainable energy and generate millions of jobs in the process,
why are we not there yet? Historically, there are three often-discussed
challenges. There is the economic challenge: the market
and market mechanisms don't yet exist or aren't yet optimized.
A second challenge is that it's just too complicated to retrofit old
assets and buildings-some of which can't manage the loads
required for electrification. The third challenge is that technology,
whether battery capacity and/or lithium components, just isn't
ready. At their core, all three challenge are technical in nature.
Less frequently discussed are the leadership and cultural
challenges, which create a " carbon lock-in. " To evolve, power
industry leaders need to shift the minds, behaviors, and incentives
of large groups of people-individuals, teams, utilities,
municipalities, sectors-to make meaningful progress toward
an urgent goal. The following are four critical steps.
Create a Compelling Vision with Multi-Stakeholder Buy-in.
Electrification can be a deeply polarizing issue. Decarbonization,
for some, means exciting opportunities to innovate and
add value to society. For others, it can mean lost jobs and a lost
way of life. It can invoke fear, anxiety, uncertainty resulting in
reduced productivity, and even active resistance.
To overcome this, leaders must get aligned, even excited about
the strategic business opportunities of electrification. And they
must be ready to bring the excitement to life for all stakeholders:
investors, current employees, future employees, customers,
vendors, and communities. Each of these groups must appreciate
their role in the future vision, how they can accelerate its success,
and, importantly, the value of taking action now.
Promote Innovation Everywhere. Decarbonization requires
wins across all areas, and leaders will have to tackle this head-on
by creating cultures that prize and reward the innovation process.
For example, one client we work with celebrates every $1
in operating expense savings because it unlocks $8 for capital
expenditures. This engages workers to drive the improvements
and ideas that will ultimately build their energy future.
May 2022 | POWER
There's an enormous amount of knowledge and untapped
potential in today's workforces. Leaders can take an example
from innovative technology companies to engage it. Google's famous
" 20 Percent Project " gave developers and team members
20% of their work time to explore ideas. The power sector could
build on this concept, encouraging the creation of both calendar
space and physical space for learning and experimentation, with
new materials and software for hands-on exploration.
Create Agility Through Networks. Even with urgent, accelerated
action, electrification won't happen overnight. In
the meantime, teams need expertise across both carbon and
decarbonized technologies to bridge from the old to the new.
That means ensuring ongoing capability building, recruitment,
innovation, and advancement opportunities for those maintaining
the critical fossil fuel systems-while at the same time developing
and onboarding the capabilities and capacities for an
electric economy.
Time and again in our work, we've seen the benefits of internal
networks in driving cross-functional ideation, action, and results.
We worked with one client that saw a cross-functional team of
10 individuals identify, design, and pilot a new direct-to-customer
business offering in just 90 days. The new offering was projected
to deliver $40 million in revenue within five years. By stepping
outside of their traditional siloed ways of working, this team accomplished
in 90 days what would normally have taken the company
years to achieve.
Create Multi-Stakeholder Collaboration. A hybrid power
economy will require deep collaboration and knowledge sharing
across organizations, and even sectors. Policymakers and
market leaders working together can best shape and accelerate
electrification. We've all seen the impressive results of such
private and public sector collaboration during the pandemic.
Finding ways for workers with different areas of energy
expertise to come together, share knowledge, imagine new
possibilities, and mitigate risks and barriers will be critical. This
means developing networks and collaboration within and across
companies. Think Google versus Internet Explorer. Google envisioned
the power of open minds, and open systems-the
willingness to collaborate with other companies and developers
while maintaining their core competency, excellent search
functionality. The closed system of Internet Explorer, tied as it
was to Microsoft systems, ended up petering out.
Electrification is gaining urgency. The leaders and organizations
that focus on culture, innovation, collaboration, and buy-in,
in addition to technical issues, will accelerate the industry's transition
to a zero-carbon economy. In the process, they and their
teams will step forward as the leaders of our electrified future. ■
-Nick Petschek is a director and Martha Deery
is a principal, both with Kotter, a change management
and strategy execution firm.
www.powermag.com
37
http://www.powermag.com
POWER May 2022 Intl

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