NREL ANALYSIS FORUM

# SPEECH #1

"Understanding our Strategic Interest in the Global Use of Renewable
Energy"

First, I want to thank Eldon Boes and the rest of the Forum's organizers
from NREL for inviting me here to talk on what is clearly a very
important topic. Second, I should mention that my comments have not been
cleared by my management at USAID, and therefore should not be taken as
the official position of the Agency. For some of you, I suspect that
will come as a relief.

Eldon and the NREL organizing committee have been very diligent in
working with the speakers to make sure we stay on message, and thus the
intention of the outlines. I will do my best to oblige and obey. I have
three points to cover, the first of which is in addressing the question:

I.  [What role does energy play in USAID's goals and
    programs?]{.underline}

-   Now this question throws me into that age-old dichotomy philosophers
    of ethics refer to as the "Is/Ought" question. In that I will answer
    both in terms of the role energy IS playing, and the role energy
    OUGHT to play. And as you can imagine the two are quite different.

-   To frame my answer, let me refer to a major report that the Agency
    released in January of this year, entitled: "Foreign Aid in the
    National Interest: Promoting Freedom, Security, and Opportunity."

-   In that report, Administrator Natsios highlights 6 goals or themes
    that are the focal points for USAID's programs. They are: 1)
    promoting democratic government, 2) driving economic growth, 3)
    changing health needs, 4) mitigating and managing conflict, 5)
    providing humanitarian aid, and 6) taking the full measure of U.S.
    development assistance, which is essentially pointing out the
    reality that ODA is just one piece of the budgetary pie that
    comprises U.S. foreign aid.

-   Now, I'm sure everyone here can easily connect the dots between the
    themes I just mentioned and energy & RE. And that each of you are
    thinking that energy is central to everything USAID does and that
    energy most certainly plays a huge role in our programs and goals.
    But then again, all of you aren't working at USAID. So, let's see
    how the agency for which I have the privilege of working, views
    those linkages most of you know so well.

-   There are two ways of addressing this: first, by amount of money the
    Agency spends on energy programs, and two, through examples of the
    kinds of energy programs that are implemented around the world.
    Let's try both.

-   First, from USAID's budget of approximately \$6 billion, we spend
    roughly \$90 million on energy projects across the broad spectrum of
    energy-development issues. Now, this may not seem like much, because
    it's not. However, a few things to keep in mind: a huge proportion
    of USAID's budget is earmarked and congressionally directed so we
    don't have as much discretionary funding as one would think or we
    would want. Second, I think we do a pretty good job in leveraging
    our energy money and, third, we're working hard to drive those
    budget numbers up.

-   Now, let me give you a few examples of the kind of energy programs
    we work on:

> -Governance (theme from Doha to Johannesburg)
>
> -Capacity Building (individual and institutional)
>
> -Public knowledge and understanding (democracy and energy)

-   Office of Energy works to integrate energy into all of USAID's
    programs (Not easy---bureaucratic barriers and cognitive)

-   Successes:

    -   Water and Energy Nexus

    -   Health and Energy such as indoor air

    -   Energy and Telecommunications and IT --distance learning (policy
        reform)

    -   Energy and economic growth --financing and entrepreneurial
        development

    -   Energy and Democratization

    -   Clean Energy Initiative and GVEP

-   So, while it is certainly our belief that energy is central to
    everything USAID does and that energy ought to be coursing through
    the programmatic veins of all of the Agency's work, not everyone
    agrees. Nevertheless, we press on.

II. [What are the benefits and challenges re: the use of RE from USAID's
    perspective?]{.underline}

-   For me, the benefits are as numerous as they are obvious (though not
    obvious enough apparently)

-   Put simply, renewable energy technologies (RETs) and the attendant
    socio-political systems they require, and which ultimately follow in
    the wake of technological diffusion, conform to and align with the
    social, economic and political conditions of the developing
    world.---that's one, and secondly, RETs are in many cases the
    necessary antecedent condition for full realization of all of
    USAID's goals and objectives. Such as GCC, gender, etc.

-   As to the former benefit, what I mean (and I'll go into this a bit
    further in my talk on the international panel) is that I find there
    to be an elegant symmetry between two global trends currently found
    occurring across the planet: 1) the decentralization and devolution
    of political and administrative power to local, subnational
    entities, 2) the technological downsizing of electric generating
    technologies. What has become known as Distributed Generation. Now,
    what is so intriguing is the convergence of these two trends and
    symbiotic relationship that exists (I think) between the two. The
    results of which can be profound for the future of social, economic
    and political development.

-   So much for the benefits; now for the challenges

-   Challenges: The challenges are twofold. In addition to all of the
    barriers to the increased diffusion of RET that we have all been
    talking about for the past several decades, within the context of
    foreign assistance and international development work, there is the
    added issue of institutional inertia and cognitive cul-de-sacs.

-   It has for sometime ceased being a technical issue of getting
    electricity and energy services to the people and is now, rather an
    institutional and organizational issue of getting the people to the
    electricity and energy services. Our institutions lack the agility
    and resilience necessary to adapt to these new technologies and
    their supporting systems. This inherent resistance to change from
    our reigning institutions --finance, government, industry, etc.---is
    reinforced by the intellectual frameworks and mental templates we
    currently employ to solve our problems. We are caught in cognitive
    cul-de-sacs that cry out for the need for a paradigm shift in how we
    solve the nettlesome problems of tyranny, poverty, and desperation
    we witness around the world.

-   In Thomas Kuhn's classic "Structure of Scientific Revolutions" he
    explains that the time is ripe for a paradigm shift when we are not
    only incapable of providing answers to the questions that challenge
    us, but when our extant cognitive models fail in even asking the
    right questions. Both of these conditions are present and I
    therefore think we're standing on the threshold of a new paradigm.

-   And that leads me to the final issue:

III. [What additional information or analysis is needed to better
     understand the role of RE?]{.underline}

-   As I stated a few moments ago, it is no longer the technical issues
    that stand between us and universal access to modern energy
    services, but rather the social and political institutional issues
    that continue to defy resolution.

-   Manuel Castells, sociologist and big thinker on issues technology
    and of the future, reminds us that "No major historical
    transformation has taken place in technology, or in the economy,
    without an interrelated organizational transformation."

-   Thomas Edison, our patron saint of electricity, knew this only too
    well. For he should be know as less an inventor than a systems
    builder. Thomas Hughes, in his brilliant history of electrical
    systems, paints the portrait of Edison by highlighting his genius at
    understanding that any piece of technology will only be as
    successful as the surrounding financial, managerial, and social
    scaffolding required to support the new innovations. Edison
    understood that it was a system---with all the integrative and
    multiple dimensions characteristic of systems---that he was
    creating, not simply, electric power capabilities. Anyone can do
    that --well not everyone---but it takes real creativity and vision
    to design the system architecture.

-   And for me therefore, we need more analysis and information on what
    the new systems will look like and the design components of that
    system. In other words, employ the current thinking of network logic
    and organizational structure and adapt those to the energy system

-   This issue, quite frankly, is too important and too significant in
    its implications to leave it to the energy community to
    solve\-\-\--by itself. We need to reach out to new communities of
    practitioners, thinkers and consumers to come up with the answers.

-   We need to --as they say---think outside the box; and sometimes the
    best way to do this, is to ask those who are indeed outside the box.

-   So, I look for good things to come from this Forum and congratulate
    NREL for the wisdom of asking the questions for which countless of
    men, women and children and desperately in need of answers. Thank
    you.