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7
Harvard Business Review Analytic Services
resiliency in the area.” A partnership
with another large energy-intensive
company followed a similar path. As
Erwin observes, “As the company
turned to on-site power generation and
microgrids, they needed to understand
the power sources and resiliency needs
of the neighborhoods they operated in.
They realized that they shouldn’t go
it alone if they want to achieve a high
degree of eciency and resiliency.”
Utilities are also playing an
increasingly helpful role, and only
34% of respondents see their eorts
to preserve the status quo as a major
barrier to energy innovation. Although
some utilities lobby state and local
governments to create regulations that
prevent companies and consumers from
leaving the grid, some are starting to
take the lead into a new era of energy.
Consider Green Mountain Power
in Vermont. The electric utility is
encouraging businesses and consumers
to install solar panels, storage, and
microgrids to generate some of their
own power and become less reliant on
the grid.
3
When customers generate
some of their own electricity, they
save money and are less likely to leave
the grid. When customers defect, the
The Demand for a Strong
Government Role
Despite ongoing debates about the role
of government in the economy, only a
tiny minority of respondents—16%—
believe that governments should have
no involvement in energy innovation.
A signicant majority believe that
government should support energy
innovation through research funding
and energy nancing for businesses and
consumers. Nearly 90% of respondents
believe that businesses and municipal
governments should work together to
improve operational resilience. FIGURE 5
The city of Pittsburgh is at the forefront
of forging such relationships and taking
a leadership role in energy innovation.
Several decades ago, Pittsburgh ocials
realized that the city needed to build
signicant economic resilience in order
to emerge from the deep recession of
the 1980s. To spur growth and draw new
businesses and residents, Pittsburgh
diligently brings together representatives
from local government, universities,
utilities, and businesses to work on
driving a citywide renaissance.
An aging infrastructure is a major
impediment to Pittsburgh’s full economic
revival. To improve the infrastructure
as eciently and eectively as possible,
the city government has developed
resilience and energy strategies. For
example, Pittsburgh modeled energy
consumption and generation across
the region to identify ineciencies and
opportunities to leverage innovations
including microgrids and combined heat
and power systems. Armed with that
knowledge, city leaders reached out to
businesses and other constituencies to
improve the eciency of the regional
energy system.
The Almono real estate development
is a prime example. For a 178-acre
project at the intersection of Pittsburgh’s
three rivers, the developer didn’t
initially realize that just plugging into
the grid could cause problems. “The
developers came to realize that they
needed to understand the strengths
and weaknesses of the grid in the area
[where] they were building,” says Grant
Ervin, Pittsburgh’s chief resilience
ocer. “They also wanted to gure
out what they could do to assure
FIGURE 5
GOVERNMENT’S ROLE IN ENERGY INNOVATION
Respondents indicating that they somewhat or strongly agree with each of the following
Governments should provide tax incentives and research funding to support innovation in sustainable energy
Municipal governments and private enterprise should work together closely to assure operational resilience
on the part of both
Government should support organizations and consumers with energy financing, such as a green bank to stimulate
private investment in sustainable energy
Governments should increase regulation of traditional, non-sustainable energy use to encourage alternative
energy innovation
Government should not be involved in energy innovation
89%
87%
74%
50%
16%
SOURCE: HARVARD BUSINESS REVIEW ANALYTIC SERVICES SURVEY,
APRIL 2017
TO MEET THE DEMANDS
OF A CHANGING
ENERGY LANDSCAPE,
ORGANIZATIONAL
LEADERS ARE WELL
ADVISED TO ADD ENERGY
INNOVATION TO THEIR
SKILL SETS.