Tech leaders: Prepare your organization for a new power grid

How we deliver and consume electricity is changing, and many of the changes are being driven by power-hungry technology companies.

Sunset over power lines and solar panels

Image: pan demin/Shutterstock

Electricity has largely been taken for granted by people who are several generations removed from the novelty of replacing candles and oil lamps with the magic of electric light bulbs. Instead, we plug our devices into a wall outlet and generally don't question the fact that safe, cheap, generally reliable power will flow as long as it's needed and the bill is paid on time.

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However, everything from how we generate, consume and even think about electrical power is changing. The WSJ recently featured an article whose title—The Electrification of Everything—nicely sums up shifts in consumption. While rarely considered, except perhaps when searching for another outlet in an overloaded surge protector, the number of electrical devices in our homes and businesses has skyrocketed. Moreover, many of those devices are connected to networks that also demand power, which deliver services from massive data centers that consume volumes of power that rival small cities. Add to this growing consumption an accelerating trend of electric vehicle adoption, and many localities and states mandating electric heating and cooking in new homes, and it suddenly becomes a bit more challenging to take the lowly wall outlet (and the infrastructure behind it) for granted.

Rethinking the ultimate utility

For tech leaders, it might seem like these changes are the utility's problem, and that power companies will "figure it out" and keep pumping electrons as they always have. However, rapidly increasing demand is coinciding with electrical infrastructure that's quickly reaching the end of its capacity and, in many cases, the end of its service life. From a near-term practical perspective, California-style rolling blackouts and an increased focus on reducing power consumption could become commonplace. Most IT shops with on-site infrastructure have power backup as a matter of course, but when was the last time you audited your generation and battery capacity, checked and refreshed backup batteries and simulated an outage?

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In the longer term, power companies and consumers are reconsidering the fundamentals of how the electrical grid is designed. At a basic level, today's electrical grids rely on centralized power generation. Tens of thousands of homes and businesses might be connected to a single, large gas, coal or nuclear power generation plant that's geographically proximate. As the utilities look to incorporate more reliability and less carbon generation into their grids, and customers look for more control and reliability, the idea of microgrids has gained traction.

Will you need a chief electricity officer?

While microgrids may sound like a newfangled idea, conceptually, it's a blast from the past, when significant, centralized power generation didn't exist. For most companies in the early and middle stages of the industrial age, if you wanted electrical equipment, you needed to build your own power generation. This is still the case in some industries, particularly those like paper manufacturing, where would-be waste products from the manufacturing process can be turned into fuel for a generator.

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With solar power and associated battery storage becoming more affordable and green mandates becoming widespread, tech companies are quickly becoming "micro utilities" and developing their own power generation capabilities. A similar concept is gaining traction with smaller companies and even residential neighborhoods, where individual entities pool resources to build local, communal solar or wind-power generation.

While cost and technical complexity for microgrids is rapidly decreasing, regulatory frameworks may be lagging in many jurisdictions. Power generation is a highly regulated industry with rules and regulations that vary wildly across states. These regulations might even specifically define what and who a utility can be, preventing your organization from legally creating a microgrid at a facility in one state that's perfectly legal a few miles down the road in another state.

As a significant consumer of electricity, especially if your organization maintains a large footprint of data centers, you can be sure that as a tech leader, you'll soon be getting a call to discuss electricity-related issues. These could range from your plans to respond to demand-driven rolling blackouts, reductions in the company's carbon footprint or even request that you add chief electricity officer to your list of unofficial titles.

In the immediate term, it's simply good management to ensure that your power backup infrastructure is updated, tested and ready. In the longer term, start exploring how you and perhaps your colleagues on the operations side of the business might rethink how your IT shop consumes, manages and perhaps even generates electricity.

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By Patrick Gray

Patrick Gray works for a leading global professional services firm, where he helps companies rapidly invent and launch new businesses. He is the author of Breakthrough IT: Supercharging Organizational Value through Technology as well as the companio...