The word resilience conjures up many different meanings. In physics, resilience is the ability of an elastic material to absorb and release energy, returning to its original form. In psychology, resilience is a mindset; adaptation in the face of adversity, trauma, tragedy, threats or stress. In the energy world, we certainly abide by these definitions, but we must go further and redefine what it means to be resilient.
Late last year, FTI Consulting conducted a quantitative survey, which told us 84% of business leaders across all G20 countries anticipated a crisis in 2020. Those concerns were largely surrounding the “normal” risks such as cyber/data security, competition/business disruption, trade issues, political and regulatory uncertainty, fraud/corruption, and litigation. It is safe to say, no one was concerned about the impact a global pandemic might have in 2020. While many of the identified risks are part and parcel of what we’re experiencing today, the COVID-19 pandemic has already taught us many lessons in the area of resilience.
We know our energy system is critical to our daily lives, and even more so now – powering our homes, which have become our default schools and workplaces, our communications and logistics networks we rely so heavily upon, and our first responders working on the front lines of this crisis. So far, the energy system has worked well because it is built to be resilient. Engineers and system planners pay meticulous attention to the power grid and pipeline system. Energy providers, together with federal and state governmental partners, rehearse disaster planning scenarios and adapt protocol to ensure our mission-essential workforce can safely do their job. The system’s resilience has been tried and tested, but it must be prepared to withstand more.
Resilience now includes planning for a natural disaster on top of a pandemic response. Hurricanes, earthquakes, wildfires, floods, and winter storms not only impact the energy system, but affect already stressed medical and transportation systems. Dedicated and improved communications access for business continuity, safety, and automated service offerings is a necessary consideration. Workforce constraints due to illness, social distancing, and shelter-in-place orders will be exacerbated. Customer needs are a greater concern than ever before, as many are now unemployed and unable to pay bills. Yet, the power needs to remain on, and natural gas must continue to flow.
The COVID-19 crisis has been instructive in detailing individual and system weaknesses. All energy providers now face risks of supply chain disruption, reduced investment due to uncertain demand, and a lack of incentives and long-term policies to support their business models. This brings challenges as well as opportunities for accelerated change, as the energy industry that emerges from the crisis will be much different.
We must consider how to strengthen, adapt, and innovate the energy sector further than we’ve previously imagined. Together, policymakers and businesses must work towards recovery and build a more resilient sector to support society in the post-crisis period.
As Congress considers energy, infrastructure, and recovery legislation, it should think carefully about how we redefine resilience. As we have seen in a short few months, returning to the status quo or merely adapting for a short time is no longer acceptable. Balancing this mandate on top of competing concerns, such as national security, economic prosperity, and a healthy environment is not an easy task. But there are some opportunities that will take these considerations into account. Congress should enlist the expertise of the energy industry on the following:
- What existing programs should be fully funded or expanded? One example is the relatively new Building Resilient Infrastructure and Communities (BRIC) program housed in the Federal Emergency Management Agency. Here, FEMA’s focus should be on utilizing tools to improve resilience, rather than simply picking up the tab for unpreparedness. The program should prioritize clean energy projects that improve resilience, efficiency, and better prepare for predictable and unforeseen climate impacts. In addition, the program should look at projects that leverage private-sector finance through performance-based contracts – a much more efficient use of government funds.
- How do we build and maintain a skilled workforce? The impact of COVID-19 has underscored the need to increase the number and the breadth of skilled labor in the energy industry. While the clean energy industry was poised to make up the majority of domestic energy jobs before the pandemic, assistance will be needed to ensure that is the case. While recovery funds help, the government should identify STEM education programs to educate kids early, community college programs to develop technical skills, and apprenticeship programs that feed into good paying jobs for people.
- What is really needed to create resilient energy systems to prepare communities across the country for extreme weather events and disasters? Federal and state government leadership is needed to promote and adopt policies that foster holistic energy infrastructure planning – not wasteful redundancy. Understanding a one size fits all approach will not work equally in urban and rural areas, as unique geography, infrastructure, climate, costs, and fuel sources need to be taken into consideration.
- How can we spur innovation? One of the reasons our energy system functions so well is because we thoroughly test elements before integrating them into the system. This is especially true of defense-critical operations. To do this, we need additional R&D funding to develop next generation systems, utilizing our national labs, military bases, and private companies. Public private partnerships such as the BlockEnergy project with Kirtland Air Force Base, Sandia National Labs, and Emera Technologies are a productive use of government funds.
In FTI’s Resilience Barometer, the United States met the average, with a resilience score of 43/100. The United States is capable of much more than “average”. This score suggests there is much more we can do to effectively build resilience and manage future risks. Using the lessons learned in 2020, we can better prepare for the next decade and perhaps the next century.
About the Author: Shannon Maher Bañaga is a Managing Director in the Strategic Communications, Energy & Natural Resources practice at FTI Consulting providing senior-level counsel and assistance in developing multi-faceted communications strategies to shape and inform the political and policy environment for clients in the energy and environmental space. Please visit FTI Consulting’s COVID-19 microsite for related updates and insights.
The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.