Concentrated failure

Events last week in Japan are a sobering reminder that the loss of flexibility in concentrated power generation is significant. Power, modern era's equivalent of food, has surpassed everything else as the fundamental driver of value creation. With power, anything else can be created – oxygen, water and food and without it, humanity is left completely paralyzed. Thus, the design of power generation is critically important in the creation of modern societies.



Scale has been the dominant consideration in power generation till recently. Status quo designs always assumed that the economics is enhanced by scale and this has naturally led to significant concentration of power generation on the grid. The loss of efficiency as electrons move around from the point of production to that of use was considered a second order effect. More importantly, the loss of flexibility and the increase in the risk of catastrophic failure was never a consideration.



Business schools have been graduating tacticians and bean counters for many decades – highly capable of adding up costs neatly in spreadsheets and putting out quarterly financials in every color and hue imaginable for the street to feed on. This orientation led them to have significant blind spots in the design of systems. For many, the bigger has always been better. In power generation, such thinking has shoved engineers into boxes where status quo technologies were conjured in bigger sizes in a mad attempt to extract efficiencies from scale.



It is time to rethink power generation. It is time for the accountants to put down their pencils and the traditional engineers to step aside. Power has to be a distributed utility in production and use and it will require the application of creativity and imagination. Renewable technologies not based on scale but on flexibility are needed to mend this madness.



Ref: Flexibility: Flexible Companies for the Uncertain World



http://www.amazon.com/Flexibility-Fle...