Headlines such as “Frankenstorm,” “Monster Storm” and “The Perfect Storm” gripped global headlines as Superstorm Sandy, a weather pattern of epic proportion, battered the U.S. Northeast in October 2012 in a way not seen in over 100 years. Over 8 million people were left without power as a result. Living through the storm personally, I can say with confidence that the United States was not ready for Sandy, but we must be better prepared for the next Frankenstorm -- a collision of storm fronts which may or may not come from weather.
The need for 24/7 baseload power is only advancing, thanks to a growing population, an increased number of wireless product offerings, bigger TVs and the need to charge hybrid and fully electric vehicles (EVs). In essence, Sandy should only validate the overwhelming need for advanced batteries, energy storage and backup EV infrastructure on the East Coast, an area becoming much more prominent in the country for energy expansion, and today a possible example for the rest of the world post-Sandy. So global investors should watch very closely for investment clues from how New York, New Jersey and even Connecticut rebuild post-Sandy.
In 2011, just one storm season before the one that brought Frankenstorm Sandy, Hurricane Irene brought its own devastation to the East Coast and showed us the type of damage a modern monster storm can really bring. However, as we witnessed post-Sandy or just months later from the paralyzing snowstorms in the Midwest or even the twin winter snowstorm called “Nemo,” the United States is still largely unprepared to deal with mass power outages. Actually, so is the rest of the world.
In August 2012, I wrote an op-ed article for CNNMoney (How the U.S. Can Avoid a Blackout Like India), which basically challenged the notion that the United States is immune to the power failings seen this summer in India. I took a lot of flak for that article, yet the fact remains (even post-Sandy) that we can’t afford to be complacent while weather patterns clearly are changing -- and changing not in our favor, with rising tides, flooding, nor’easters and dangerous wind currents that are all increasingly wreaking havoc on our power supply.
Hasn’t anyone noticed the ease of disruptions to global power supplies in recent years? In 2003, Italy had a blackout that affected nearly 56 million. Germany had a power outage in 2006 that affected roughly 10 million throughout Europe. China experienced power loss that shut the lights for over 30 million people in 2008. Tens of millions were sent into darkness in Brazil due to electrical outages in 2009. Many people (myself included) watched the 2011 Fukushima Daiichi nuclear disaster in awe from news programs broadcast around the world. Concerns over an earthquake and a tsunami certainly were put on a shelf (maybe too high a shelf, I believe) as most focused on what became the largest nuclear disaster since Chernobyl in 1986.
Now, imagine if the lights went out in every city across the United States. That is what basically happened in India in the summer of 2012 as twin blackouts hit 370 million and an astonishing 670 million people in India in the same week (the entire U.S. population is 313.8 million).
Sure, India -- the fastest growing country on the planet -- does have frequent outages because of growing demand constraints on its power grid, and the country was plagued by the driest monsoon season in quite some time and arguably an example of climate change. However, these huge losses of power should raise some large red flags of concern that ultimately may result in firmer direction at the government level, new investment, increased innovation and a consumer behavioral shift like never seen before. This has to happen here in the United States as well.
Why? A convergence of sustainable supply and demand is really the heart of the global smart grid conversation. Therefore, as India recovers from its own power nightmare, it’s time the United States puts its own politics aside and makes the smart grid a big priority before the lights go out at home again post-Frankenstorm Sandy.
Remember the U.S. blackout of 2003? That was a widespread power outage (again in the northeastern U.S.) that also affected 10 million people in Ontario, Canada, thanks to a software issue at a FirstEnergy site in Ohio. Imagine, in this day and age, our power grid remains somewhat of a joke because we simply haven’t learned lessons from the past. That has to change.
At the end of the day, the U.S. can’t remain a superpower if our lights aren’t on. That means we must be willing to adopt change and embrace new ideas which very likely could be emulated around the world. This has me thinking: With so much room for opportunity to make energy more efficient, there is no reason at all to think the next Facebook or Twitter won’t come from within the energy sector.
In my book, "Lessons from Frankenstorm: Investing for Future Power Disruptions," I specifically focus on new threats such as too much dependence on natural gas, cybersecurity and the absolute need to advance energy without water reliance. I also highlight new transformational opportunities (modular nuclear reactors, cleanweb solutions, 3D printing, offshore wind) that can help us be better prepared when the next storm and power disruption does come.
To learn more about the smart grid and the convergence of sustainability and technology, be sure to check out VERGE SF Oct. 14-17. Adapted from "Lessons from Frankenstorm: Investing for Future Power Disruptions." Reprinted by permission of John Wiley & Sons. © 2013 by John J. Licata. All rights reserved. The e-book is available on Amazon.com for Kindle, Apple iBooks through iTunes, Barnes&Nobles.com for the Nook and Google Play for Smartphones, Tablets, Laptops, Computers and eReaders.
Image by Chones via Shutterstock.