I'm in Boston for the Pension Real Estate Association (PREA) meetings, which have been torpedoed by a power outage that has now lasted for more than 16hrs. I have to commend PREA for their focus on energy efficiency -- this is certainly the most efficient hotel I've stayed in. And it's quite cosy to have candlelights in an otherwise sterile hotel like the Westin (even the bathrooms look like they're from some romantic movie...). But from a practical perspective, no electricity is killing. No electricity = no hot water, no heating, no lifts (not nice if you have a room on the 30th floor), no projector (not nice if you have to give a talk), etc. Then there's being disconnected from the world, which is a strange experience -- it almost seems like my tweet about Au Bon Pain having power and internet has backlashed. This place is now filled with internet junkies that collectively slow down the internet to pre-2000 speeds.
This experience is a good wake-up call though: our society crucially depends on electricity, and this dependence is bound to increase going forward. The era of electrification is fueled by the advent of electric cars, energy-guzzling appliances and increasing urbanization. Buildings remain critical, because that is where we spend our time (remember: 75% of electricity consumption happens in buildings). We should start to think more about local energy generation, so we're not just relying on an old grid. We need much better integration between demand (i.e., buildings) and supply (i.e., central or decentral generation), which can only be achieved by "bringing buildings online." Renewables could solve part of the capacity problems that we're currently facing (especially with nuclear plants going offline in many countries), but balancing their volatile supply with peaks in demand will be challenging. The fact that more than 15 tri-generation plants are ready to roll, but are currently not being used in Sydney still blows my mind (I just tried to explain the concept of tri-generation to a big real estate investor, and I failed miserably. Which tells us something about the importance of sharing learning experiences in order to speed up the diffusion of new technologies beyond national borders). Governments should act much more forcefully to deregulate energy markets and allow for competition. The vested interests of traditional utilities are just too high.
The focus on energy is now broadened from just "efficiency" to "reliability" and "dependence." It all comes down to better understanding energy demand from buildings, and putting buildings to use rather than letting them standing passively. Something to think about when my battery runs out...
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