Back to Back We Face the Future

While clearing out the clutter from a moss-covered file box, I stumbled on editorials and articles destined for the pages of Distributed Energy, the original name of our current Business Energy magazine. Leafing through a few, I was saddened to see no mention of energy storage as a central part of future energy strategies other than as components of UPS systems to bridge the gap between the loss of grid power and the point at which local powerplants could come up to speed to take over the load. “Why couldn’t I see the potential for energy storage then,” I asked myself, but in fairness, I wasn’t alone in this this lack of vision.

But as far as understanding the path we were on at the time, I’d like to share with you the editorial I wrote for the July/August 2005 issue of Distributed Energy, suggesting that for the changing of some of the numerical values, it pretty much sums up the situation we find ourselves just now a decade later squaring away to address.

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Gauging the Risk

In 2004 St. Louis, MO-based Emerson (NYSE: EMR) commissioned Decision Analyst Inc., of Arlington, TX, to conduct a Small Business Power Poll, to determine the attitudes and capabilities of the small business community—that segment that generates 40% of our gross domestic product and creates nearly 70% of all new jobs—in the face of threatened power outages. Here with the sponsor’s permission are a few of the findings:

  • 62% of small businesses do not have any type of backup power supply.
  • 75% say electrical power outages are a threat to their business, but only 22% feel very prepared to deal with an outage.
  • 80% experienced at least one power outage in 2003 (one in four experienced three or more outages)
  • 58% are interested in adapting “big business” backup power technology for their small businesses.
  • 56% say a backup power system would give them a competitive advantage. Agreement in this is twice as high among businesses that have such systems (82%) compared to businesses that do not have such systems (40%).
  • Chief among their power outage fears is losing valuable computer data, records, and research.
  • Of those experiencing power outages, 29% were without power for at least eight hours during the longest outage; 19% was without power for at least 16 hours.

In the wake of the August 2003 power outage:

  • 21% conducted an audit to identify electrical power needs in the event of an outage.
  • 35% researched or considered some type of backup electrical power system.
  • 3% purchased backup power technology. Based on the more than 6 million small businesses that have recorded payrolls in the United States that translates into at least 200,000 small businesses having taken action since the August blackout.

Faith in the Grid…Not!

  • Only one in five is very confident that the power grid can provide reliable electrical service to businesses.
  • The aging power grid (29%) and ravages of Mother Nature (30%) are viewed as the biggest threats to reliable electrical power. 9% ranked terrorism as the top threat.

Of the 80% of small businesses that experienced power outages in 2003, 15% said their longest outage cost $5,000 or more. Based on the more than 6 million small businesses that have recorded payrolls in the United States, which translates to at least $4.5 billion in lost revenue and productivity, and untold billions in losses for America’s other 16 million small businesses.

These responses to the survey were both predictable and frightening not only in terms of the sector’s vulnerability to power loss but to the well-being of the nation as a whole. Even those very large organizations seemingly secure behind onsite power resources of their own are not immune from loss when the myriad supplies and services upon which they depend are interrupted from below.

Options, Options, and More Options

Of the many lessons you may wish to take away from Emerson’s survey, none can be more important than the recognition that big or small, firmly established or scratching to stay solvent, we’re all in this together. Yes, backup power can and must play an important role in your energy security, but in the final analysis, options from top to bottom are the critical element…and they come from increased distributed energy resources, not centralization.

I believed it then, and even more fervently today.

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