Cheap renewables and surging bills

Even as we see the levellised cost of solar coming down, and increasing penetration of renewable energy, the electricity coming to us in our grids are increasing in prices. At least it seems to be so in Australia. There’s a lot of cost associated with the transmission and distribution infrastructure that needs to be recovered – partly because the growth of intermittent renewables mean that the grid infrastructure will have to be expanded.

But it is not just that; there’s also more padding required in the margins of electricity retailers because the intermittency results in even more volatile electricity prices in the wholesale market. That means that if the retailers are still providing fixed price tariffs and long contracts to customers, they will have to manage their risks by putting higher profit margins into the retail packages.

There is a huge price to pay by the society to eventually enjoy more renewable energy. If we don’t adapt to the intermittency through more adding more flexible generation leveraging on demand response and integrating EV recharging networks into the network operation optimisation (ie. Vehicle-to-Grid systems), we can only expect higher bills. We had better accelerate the transition or we’re soon losing the patience of energy consumers.

Specific thinking

I wrote about the holistic thinking that was characterised by western researchers of Asian’s approach towards persuasion as contextualised by Erin Meyer. I had the chance to reflect a bit more on specific thinking as I begin to observe it more and more at work in western workplaces and cultures. There are no right or wrong and the good and bads can only be appreciated from particular perspectives or lenses.

Specific thinking parcels out bits of work and various tasks, having more of a tendency to operate in silos even when coordination is excellent. This can make things difficult to change and also individuals becomes less sensitive to the overall workings of the system they are part of. It can be good in that it reduces the anxiety around being unable to bring about the intended collective outcome because one can just focus on delivering one’s part and leaving the rest to others. Being specific in thinking also encourages focus on the smaller specific outcome that is within one’s control.

However, specific thinking may mean that there’s less ability to navigate situations that are far more complex where clarity does not come instantly. For example, during a business development meeting, one may not yet figure out if there’s chance of collaborating or working with the prospect when we are still in discovery phase. Specific thinking can lead one to try and force a result and be counterproductive, or to give up too early.

Specific thinking may also render us unable to genuinely celebrate collective wins as one becomes overly focused on the parts they are ascribing to themselves to the extent they ignore other parts of the system they are part of.

Just some observations and muses on my part.

Training programmes

During my time in public service, I’ve attended lots of different training programmes. There were a lot of training on writing minutes, professional reports and trip reports, as well as some on professional etiquette in a wide range of situations including during presentations, business meetings, business meals, cross-cultural interactions and so on. I won’t say all of them stuck with me and in fact, the elements that stuck were the ones I found useful on the spot and decided to make it a point to adopt. If they didn’t stand out when I first received them, the chance of them being useful to me was really low.

So the notes I took during those courses were at best museum artifacts of professional training I had received. The greater learning was done actually observing how my seniors, my managers and bosses behaved in those various settings, what they deemed important and asked questions about in reports and minutes. Those standards and disciplines were cultivated in that manner rather than through a couple of hours of training. In fact even days of training won’t cut it.

So is training a good way to enforce standards and uplift them across the people in an organisation? I think it can be if it aligns well with what is being practised and expected in an organisation to such a level that the senior management is practising them already. As David Maister rightly pointed out, training doesn’t work if it’s designed to change the juniors or frontline staff while the senior management or middle management is allowed to be set in their old ways.

Facts or opinions

I saw a pretty brilliant video of a mother trying to teach her child about facts, opinions and mindsets in response to social environments. It’s in Chinese so I paraphrase in English the approach she has taken.

She held up an apple as her daughter eats a cob of corn and asked, “This is an apple. Is that statement a fact or an opinion?”

“A fact” said the daughter.

“Yes. That is a fact. Now Mummy says that the apple in my hand is tastier than the cob of corn you’re eating. Is that statement a fact or an opinion?”

“An opinion” said the daughter, still happily chewing on her corn.

“So when the kids at the playground says that they don’t like you and don’t want to play with you. What do you think that is? It is an opinion.” the mother continues.

The mother than took out a mug with black coffee in it. She said, “Look, daddy loves to drink this black, bitter drink but mummy doesn’t like it. Whether someone loves it or don’t like it, the coffee is the same, it has the same color, smell and look. People liking or not liking it says more about themselves than the coffee.”

She went on to say, “So when those kids at the playground say they don’t like you, it has nothing to do with you being you. You are still the same.”

The wisdom extended from the simple analogies were really brilliant and the manner she brought it forth and contextualised it for the daughter really made for a great model in teaching these ideas.

What is value?

One of the key fundamental steps to take in order to move towards a low-carbon future is to re-assess our notion of value, economic value. Over the past decades, economic value had been increasingly important as more and more things in the world could be bought with money. This is what Michael Sandel calls the making of a market society.

This is worrying because the value of anything and everything used to be so much more. There’s richness in being able to evaluate and appraise value of various things in different ways. And this is why dollar values can never encapsulate all of that. In fact, there is no such thing as a market for single goods and services. The notion of a market price is just about as real as the notion of an average. The same good can be simultaneously sold at low and high prices depending on where, when, and to whom it was sold.

By defining this abstract concept of market values, we are trying to make a subjective valuation something objective. We are trying to abstract from specific context and circumstances and forcefully say that surely there is something about the good or service itself that has nothing to do with all that. And if we can gather the averages or have a large number of observations, we can use that statistic as something objective. In reality, the statistic is just a statistic – is it a market value? That’s up to whoever is reading the statement.

Beyond the market, the real way to appraise value continues to be subjective and that is okay because we all should be selecting the dimensions we all care about and build our decisions based on that.

Ready-made solutions

Just add hot water to instant coffee and you get your morning cup of coffee. Boil some water and pop the noodles and powder in, or even better, just rip the packaging and put it into the microwave, pressing just a few buttons then wait – and you get your meal. Bring a packet of ready-mix cement and mix in water, and you can have some of the bonding materials for your brick building. Or you can start paving the road.

So why can’t you just order a report and instantly know everything there is to know about a market? Or to pay someone to give you all the answers to entering a market for your business? Even better, pay someone to enter the market, run the business for you and then you just reap the business success benefits? The challenge of having instant, ready-made solutions in some parts of life is that we start expecting all parts of life to be like that.

And worse still, we allow the market to grow into crevices of our lives expecting it to deliver but it never does. Professional service can deliver a report but won’t be able to ensure you learn all about a market. You could get someone to develop a strategy to enter a market for your business but you’re the one who would eventually have to follow through with it. And moreover, the less you’re involved in co-developing the plan, the less you’ll be able to actually execute it.

There are just so much work that is better, more beautiful and meaningful because they involve co-creation and where you’re paying for someone to partner with you to make a new thing happen. The reason you’d pay them for it is because you will eventually reap the full benefits of the result while they wouldn’t have been working to partner with you otherwise. And in this domain, there are no ready-made solutions for you to purchase; you will have to do the work if you want the success. And it won’t be guaranteed.

Bridge to the future

Having been based in Australia for two months now and getting a better view of the overall energy landscape, I’d say that the greatest hurdle we need to overcome is developing an alignment in commitment, plans and action to bring bioenergy especially biomethane into the system energy mix in order to decarbonise.

We are trying to build a bridge to the low-carbon energy future. And there has been many announcement, efforts and plans around hydrogen hubs, hydrogen parks. In the year 2023, the prices of electrolysers didn’t seem to come down all that much as expected, renewable electricity in the form of wind and solar, while being cheap, is bringing about a degree of intermittency that challenges grid operations to the extent that overall cost of electricity or at least access to electricity remains high. As it turns out, we were building the bridge from the destination towards us when we were working on the hydrogen projects. They were good, at some point in the future but it seems that they are not being built fast enough to reach us today. We are still unable to adopt those solutions.

This means that as the decarbonisation targets and emission reduction dreams comes back to bite us, we need to start building the bridge from our side. And biomethane is a great solution that allows us to do that. It displaces natural gas on a one-to-one basis and does not require end-users of natural gas to change their appliances. Biomethane can be spec-ed properly in the biogas upgrading process in order to achieve the quality required for gas grid injection. Moreover, the production of biogas (precursor to biomethane) can be done in conjunction with managing our organic and agricultural wastes which were either being burnt, composted openly or sent to the landfill – all of which involves some kind of carbon emission (albeit short-cycle to a certain extent) that does not achieve extra work done. And don’t get me started on the potential of biogenic carbon dioxide as a future market to build.

Lots of clear work and action. Once we get the perception right and eliminate the misinformation around bioenergy in Australia.

Valuing art

It is interesting how just a year or so ago, people were speculating on NFTs (well, now we can be sure it is speculation though it was to some investing); and then today, people are using generative AI to generate tonnes of images and becoming artists themselves. So then, what is art and how do we value them when the computers with the right algorithms can churn out lots of different interesting nice-looking graphics and respond to prompts with interesting and surprising twists?

Art, ultimately is about the impact on others and the manner by which the message or the intent of the artist gets conveyed or put on the audience through the art work. Ultimately, the tangible art piece or the experience (visual, sound, feel, taste, smell) of it is just a manifestation of the ideas that are being expressed by the artist. It always had a value that wasn’t about money but about influence and ideas.

If we are caught up with the prices of art pieces, or the seeming worthlessness of them, then we are probably missing the point. It is also why people find it hard to accept their children embarking on the starving artist journey. And my most artistic friends are often actually teachers or trainers trying to help amateurs or lay person appreciate art. Connecting to the meaning of things in the world where we’ve allowed meaning to be squeezed out of us must continue to be something affordable for all of us. And we all can consider making that connection and contributing something to the ones who continue to help us make sense and meaning of the world.

Government bashing

The government tends to be an easy target for most of the problems, or the lack of solution towards them. In most cases, the lack of technical solutions tend not to be the barrier towards solving the problems. It is a matter of adoption. And people look towards the government to drive the uptake of solutions. The struggle today, in the market economy where there’s a multitude of technical solutions backed by various different economic interest, there’s some kind of gridlock towards having governments select solutions.

Historically, the popular beliefs, ideas and thoughts drive the directions of democratically elected government. Influence from businesses probably will contribute to some of that. But the options are limited (automobiles or horse carriages, internal combustion engines or electric engines, AC or DC transmission, etc.) and there are certain dimensions by which governments can justify their choices and move forward.

Today, it is less clear. Should we electrify homes completely or allow them to continue using gas, albeit having to encourage the development of renewable gases? Should the government be driving the choice of technologies used in homes or industries by enabling or making difficult the development of more biomethane for grid-injection? Or should they be encouraging full electrification not just of homes but also industries, and even heavy transport, redeveloping infrastructure to be able to deliver lots of electricity, enabling battery swapping or ultra-fast charging along highways?

What are the dimensions that the government should be optimising along, should they be taking positions to propagate certain solutions or standards? Are they in the position to make those choices? Yet some of these innovations and technological adoption can only move forward with enabling policies. The issue is that being in a standstill and not enacting any policy is in itself a choice for status quo, for the carbon-intense way of life, and dooming our system. Yet making a choice can mean excluding certain options or causing certain options to be more or less expensive than they otherwise would be, hence favouring one over another.

Taking policy positions and ultimately making some kind of technological choice implicitly is inevitable. So it is just a matter of what are the priorities.