To do no harm, think critically, be humble

stop adaniLast week I signed the Australian engineers declaration on climate and biodiversity crises. This week I was asked to speak at a Stop Adani rally to pressure one of Australia’s big engineering firms, GHD, to rule out working with Adani on the coal mine.

Here’s my letter to GHD:

Dear GHD,

I’ve looked at your media responses relating to requests to stop contributing to the Adani coal mine project and I find them inadequate. We need all the resources a company like yours can muster working toward solving our climate crises not undermining efforts. Please find my speech to the protest outside your offices today. I hope it provides some food for thought.  Please consider signing the Australian engineers declaration at engineersdeclare.org.au and polling your employees for their thoughts on how an ethical, modern engineering company should behave in the face of an urgent society-wide need to radically change our energy systems.

SPEECH

The first true professions were considered doctors, lawyers and priests – and its interesting that these three professions have a form of oath or promise to be true and good.

200 years ago engineers were sneered at by the doctors and lawyers for not being “true professionals”. Their work was too practical, they got their hands dirty to make stuff happen. They were considered jumped up craftsmen.

But engineers have achieved so much. Our profession has been synonomous with progress throughout the industrial revolution. Our work has invented and improved the technologies that use our bounty of fossil fuels:

  • The steam engine
  • Railways
  • Cars
  • The light globe
  • Electric motors
  • Power stations and
  • Aeroplanes

We are waking up to the fact that energy has given us so much and we can’t live without it. BUT fossil fuels need to stay in the ground.

We no longer have sneering about the worth of engineers.

And our profession holds strong values about the reliability and safety of our work, but we don’t have an equivalent to Hippocratic Oath of

First, Do No Harm

We are at an important moment in history to make good on that omission.

We can join the Australian engineering declaration on climate and biodiversity crises. It recognises that engineering has a responsibility to actively support our transition to a low carbon future.

This is our moment to make a promise to our planet and our fellow citizens to be true and good.

As a profession we have enormous expert power, the power to understand how systems work in detail, the power to build stuff and make it work. Yesterday, the Guardian pointed out that firms like GHD are nothing without the expertise of their employees.

Engineers are smart people and we’re good at solving problems

We can build and develop the technologies that meet the needs of todays society without breaching the earth’s ecological boundaries

  • But to do so, we need to think critically about our impact. We need to see beyond our immediate job and our immediate client. We need to challenge ourselves to understand the broader impacts of our design decisions and commit to decisions that only push us in the direction of better.
  • And we need to be humble. Engineering expertise is not the only expertise needed to solve planetary challenges. Respecting and learning from the knowledge of others is an essential skill and can help us avoid the tech hubris that engineers have been accused of in the past. We have not been perfect and as a profession we have caused more than our fair share of problems.

Changing the way we do our jobs is not a simple proposition, it challenges our deepest habits, it requires changes to our workplace systems and it involves all our colleagues around us.

I think it’s a bit like the disruption of renovating your own home. A reno is not something you head into lightly. You need to plan it carefully. And the middle part is always messy – where you are moving away from the old ways but haven’t finished building the new. But it will be worth it and we need to commit to these sorts of deep changes in our workplaces.

We can’t talk about tackling climate change without understanding that deep changes are needed in all parts of the energy system value chain. GHD need to be part of that change.

They say management is doing things right

but leadership is doing the right thing

To my fellow engineers I say, lets make our promise that our work will do no harm – this is our moment to step up and lead.

Posted in Climate change policy, energy transition, Talks | Tagged | Leave a comment

My PhD – redesigning the electricity grid

Almost a year has flown by and I haven’t announced my PhD formally. That’s because its taken me a long time to wrap my head around what I’m doing and which parts of it are going to provide the ‘original contribution to knowledge’ that a PhD demands.

But I’m starting to get some clarity so here’s a snapshot under a full title of:

Redesigning the electricity system with microgrids

hierarchy vs network

We’re in the middle of an energy transition.

Energy is one of those systems that is so closely linked to the way our society works that changing it is really difficult and involves a whole mess of decision makers.

We have an electricity system that relies on a few centralised, power stations powered by coal or gas and we need a system that can run solely on renewables like wind and sunshine. We are stumbling forward, and each step of progress seems to come with evermore problems.

Many experts around the world are working on our energy transition and they tend to fall into two camps.

The technical experts are busy designing their little part of the system, fixing problems but rarely pushing back on the whole system to change. We need all these engineers, economists and lawyers for their detailed knowledge, but not only them.

Meanwhile social scientists and other big picture types are telling us we need to think about the whole system at once, and we need to bring all the right expertise together. I agree and have just collated a rather long blog on some of my reflections over the past five years about generating systems change.

So we are moving away from our hierarchy of energy and we could move toward a network of smaller systems where each town or suburb is a microgrid, a micro-electricity system, that works well with all the solar panels on people’s rooftops and uses its neighbours for top up and support.

My research aims to design this new system.

It won’t stop at the work of the engineers looking at how the electricity flows. It will include the work of the economists so that how the money flows matches the new system and the work of the lawyers too so the rules match as well. And importantly, it will include one more expert that I haven’t mentioned yet – people like you, the householder and the business owner because this is the only reason we build electricity systems and if we don’t look carefully at how the value flows, then we won’t build the right system.

Together, these experts and I will design electricity systems for three communities. Without our design, each community would get the traditional investment – a transformer upgrade, reinforcing the old system. With my design we can explore better options, Options that start building our future system – and because they’ve been part of the design team the engineers, the economists and the lawyers will start to agree on what that future system looks like.

Einstein famously said “We cannot solve our problems with the same thinking we used when we created them.”

Our society urgently needs to become better at responding to difficult and messy problems. My research will add a powerful design tool to our toolkit for change.

Want more detail? Here’s my research proposal but like any good PhD this is evolving.

The research question is an important part of any PhD – spend more time getting it right and you’re halfway to your answer already. For now, my research questions is:

Can a co-design method and a systems approach deliver microgrid designs that integrate competing stakeholder values effectively and offer a pathway toward the redesign of the electricity system?

 

Posted in Bright Ideas, Changemaking, energy transition, PhD | Tagged , , , , , , , , | Leave a comment

Change starts from within

changestartsfrom withinChange starts from within

…but mustn’t end there

My first real blog was about change. And when I reflected on opportunities that have resonated with me I wrote, “My core question: How can we solve the world’s problems?…. together?…. by learning faster? ……by sharing a common understanding? …. and what’s my role?”

In 2016 I returned from my Churchill Fellowship with insights galore and much to ponder. One of the intriguing lessons from the wise community leaders that I had reached out to was, “change starts from within”. It came up a number of times and I included it as one of my themes.*

I wrote, ” Change starts with the individual.

Making an effective difference in the system relies on understanding that there are different roles and effects. Activists need to be committed to measuring their work against the impact they are having and being prepared to try different approaches. They also need to understand that the effort can’t be sustained unless it is fun and you are working with people you care about.

But if you want to get stuck into designing the energy system of the future you have to be prepared to work with all sorts of strange bedfellows and build the relationships to work together. This requires everyone to dig deep, find ways to trust each other and to understand other perspectives.”

One friend rounded on me, ” don’t tell me we will stop the planet from going up in smoke by turning off a few lights and composting our waste” – no this isn’t about everyone doing their little bit. We have major systems to change and we can’t do that just by focusing on our own individual impacts … and hence the diagram above.

But we can’t run from the inside of the diagram straight to the outside and make change happen. The best ideas, the most powerful or well connected people, or the most money – none of these can create change on their own. In fact there is no right answer yet. Change is something that emerges, not something that is determined at the outset.

Change is a together process. For anyone with an egalitarian sensibility, it also needs to be a fair and respectful process (in fact change can devastate vulnerable people the most, so high ambitions for the change process are essential). So lets step through the diagram from the centre to generating real change in the systems that need it.

changecentreChange starts from within, and I think the essence of this message is that we can’t expect others to step toward us in understanding the problem, if we are not also prepared to step toward them in understanding their perspective. Some humility is in order. If you think you know your way to the answer already, take a step back and consider that you will need to learn throughout the process of change. There is always new knowledge to be integrated into our solutions.

I’ve come across a few concepts which are worth wrapping together in order to understand the importance of this message and useful ways to behave and act.

  1. design infinte

    You’ll often see this representation of ideas and the generative space between us. Dialogue, like design is an ongoing generative cycle.

    Richard Sennett, in Together: The rituals and pleasures of cooperation, takes time to distinguish between the dialogic and the dialectic. Debating the merit of something only gets two parties to move toward each other, through compromise or good reasoning – that’s what the dialectic gives you. By contrast, a dialogue generates new. New ideas, fresh insights, deeper understanding, empathy. You have to listen. You have to reflect. You have to learn not to be precious with your own ideas.

  2. yankelovich learning-curveDeliberation. I’ve written before about how people need time to go on their own learning journey and build knowledge about an issue in order to understand how it squares with their values. Raw opinions are inconsistent. Deliberation is rock solid. I’ve tried to square this with expert knowledge. Experts are rightly criticised for thinking they know how to balance various societal values. But experts do know stuff that others may not want to spend a lifetime learning. Being a responsible and trustworthy expert involves ensuring you deliberate, offer transparency about the values that bias your work and also challenge your own judgement with…
  3. boundary critiqueCritical system heuristics. OK, I’ve got a bit carried away with the value of critical thinking recently but I’m quite excited that there’s a whole language for thinking that challenges the dominant paradigm. Karl Marx thought of it as emancipatory knowledge and felt it occurred through work. I’m experimenting with using the frameworks of Werner Ulrich to think in systems and to challenge the real motivations, sources of power and knowledge. The idea is that if you compare how people frame a concept with how they should frame it (by redrawing a few boundaries), you can get more legitimate ideas.
  4. Theory_UI think Otto Scharmers U model has plenty to offer. We all know about the importance of opening our minds. But that’s only the first step. Opening our hearts, allowing ourselves to care for others and see them as fellows in this change journey is so important for building trust and communications. Open Will is the step I have the most trouble with, letting go of our ideas, accepting that what emerges will not be yours, but ours and it will be different to the path you thought you ought to taPKM-2019.001.jpegke.
  5. I’d also like to link to the idea of Personal Knowledge Mastery and the concept of working out loud. Because we make more sense of the world when we triangulate our discoveries with the different perspectives of others.
  6. Finally, I think the practical dimension is missing in my list so far. Design as research and creative activities as research are newcomers to the formal knowledge game – because they try to capture what we learn from doing. The scientific method favours the objective observer, but the designer is always part of the process and uses models, tools and prototypes to always iterate and test ideas. Our feedback loops are the important thing to consider. We get feedback from our bodies when we do stuff – this is often referred to as tacit knowledge because its unarticulated. We get feedback from our emotions. We also get important feedback if we stop and reflect. Building feedback into our learning is an important part of growth.

grouplevel.pngMoving out to the group or organisational level, we get a whole new series of messages and helpful hints. Solutions to the tyranny of structurelessness (no one is allowed to be in charge) and the limitations of consensus (everybody needs to agree) are offered. Do they work? or do they undermine everyone’s sense that the group is working for the benefit of all?

I’m less confident about the messages here because I don’t get to live them or test them myself. So in theory:

  1. changemakertypes

    One look at these roles from the Story-of-Stuff makes me realise how different the knowledge of the situation is when collected by each of these types.

    The distinction between structure and self-organising is the distinction in my diagram between group and network. It’s a scale thing. Zappos embarked on a holocracy experiment because “when a city doubles in population, innovation or productivity increases per capita by 15%, which is the opposite of what happens when a company doubles.” The group is small enough to agree its own structures, fill different roles and build the relationships that create great teamwork.  Maybe bigger organisations work too but increasingly corporate-speak looks for leadership that empowers its groups and breaks down its silos. And groups aren’t always the ones you choose. The Water regulation examples I have found in the UK and the USA (Judith Innes – Diversity, Interdependence and Authentic Dialogue process) speak to similar values. When a group is forced to work together, ideally they overcome their differences and work as a team.

  2. I’ve always been aware that many decisions are made in the bowels of organisations. Many on-high decisions are stymied when they get to the practical doer who needs to implement and (in reverse) championship and good changes can happen at a very local level. It doesn’t need to be amongst the most powerful. Vineet Nayar reckons 10% of employees are the type of champion to care about an organisation and transform it for the better if you bring them with you. Nilofer Merchant says anyone can make their dent on the world. And I’ve written about the many and varied voices we need to hear from in achieving our energy transition.
  3. Frederic Laloux is famous for his take on ‘teal’ organisations which are more empowering (and successful) than normal corporations, and in this video he raises three key points which are mirrored in the organisation of ecovillages.
    – Effective admin and operations comes from natural leadership. Letting people lead when they can and want to. Letting them make decisions with a sensible scan, check in with some wisdom, involve those affected.
    – Space for people to be authentically themselves is important and if people turn up to work “whole” instead of just presenting ‘corporate me’, the organisation is better. (This probably relates to work and meaning at the personal level too)
    – Vision and organisational direction emerge. The space for the conversations that let this happen is important. I’m guessing it is the dialogic space.
  4. timmonsNext comes innovation. Change needs innovation so we can step forward into the unknown and create that future. Look at Timmons triangle (a well known innovation framework). Unsurpringly, it looks like the framework in New Power but Heimanns and Timms put the broader social movement or network in the place of “Resources”. changematrix.png
  5. Finally, power! I’ve thought about the matrix shown (from an article in SSIR, paywall sorry) in slightly different dimensions. Creation and destruction can be termed “Power-with” and “power-over”. Confrontation and collaboration can be thought of as outsiders and insiders. Activists are down in the blue quadrant, building a social movement with the power to demand that the system changes. But if we see everyone in the system as real people then the working together approaches are attractive places to put our efforts.

In summary:

  • at small scales we will create structure, at larger scales we might need to let the network, the empowerment and the sensing system emerge.
  • At the group level we need diversity and there will inevitably be different roles. These differences are key to creativity and a fuller picture of the situation.
  • At the group level we will have leadership, ownership, drive, responsibility but it can emerge everywhere and anywhere – the same with collaborations and helping each other.
  • The group level is the doing level and also creates the trust and safety for good work and belonging.
  • The group capitalises on innovative ideas and puts structure around idea development, even as the network informs, resources and supports that process.
  • The group relationship to the network and broader system could be collaborative and egalitarian but might need to be competitive and astute about power.networklevel.png

Networks are the only good way to scale. Culture eats strategy for breakfast. Any strategic direction needs to be based on a shared vision. A classic policy development diagram shows any major social change stalled at a backward and forward contest until the politicians have brought enough people with them to get the law passed (eg smoking legislation). The changes I am considering in this blog need many people to come on the journey, so a network that can scale is key to the concept.

  1. Self-organising is an idea that really excites me. It’s why I’m building wiki-based knowledge hubs. It’s why I explored the constellation model for collaborative policy making (and others, as you’ll see if you read the whole blog) and it was probably kicked off when I read Clay Shirky’s Here comes Everybody. If you didn’t read it before, there are three interesting examples in the governance and organising blog.
  2. Another theme that has followed me around is evolution and what it means to be homo sapiens. I like the idea that we are a group species and therefore have group behaviours, norms, cultures which help us survive. In fact in Mothers and Others Sarah Blaffer Hrdy posits that the care our infants need made us the intelligent communicating mammals we are. In Moral Origins Christopher Boehm suggests that bullies and cheats were easily dispatched in tribal groups so they learnt to hide or moderate their true nature, a key point in the development of a conscience. In Give and Take Adam Grant shows us how to give effectively and heralds the end of the takers as reputational information travels further and faster in the days of LinkedIn etc. (just quietly, bring on the demise of those who suck up and sh*t down)
  3. Paradigm shift can only happen at scale too. George Monbiot has a thoughtful effort at a new narrative, one of togetherness and belonging. He talks up the rebuilding of community.  And to quote Donella Meadows:

    So how do you change paradigms? Thomas Kuhn, who wrote the seminal book about the great paradigm shifts of science,7 has a lot to say about that. In a nutshell, you keep pointing at the anomalies and failures in the old paradigm, you keep coming yourself, and loudly and with assurance from the new one, you insert people with the new paradigm in places of public visibility and power. You don’t waste time with reactionaries; rather you work with active change agents and with the vast middle ground of people who are open-minded.

So if you start your change effort from within, you find your team and groups, and you work together in a scalable network. Then we all have a chance making the changes this planet so desperately needs. Let’s get working!

*A big thanks to Al Weinrub for his wise words, “change starts from within”, at the beginning of my Churchill journey. He published, “Energy Democracy: Advancing equity in clean energy solutions” shortly after and has no idea how much I’ve tried to wrap my head around the importance of his message.
**need some more inspiration?
– ideas are a network – watch this Ted talk
– learning is a social process – I’m reading Communities of Practice: Learning, Meaning, and Identity by Etienne Wenger at the moment
– leadership is defined by followership – my next blog will look at ideal leadership in the context of culture, strengths and context.

 

 

Posted in Changemaking, energy transition | Tagged , , , , , | 2 Comments

Regulating Water – together

Water_Collaboration_Image

The visit to Scotland has provided an opportunity for SA Water stakeholders to understand an exemplary process undertaken in regulatory price determinations in Scottish Water. Looking at the England/Wales process unearthed alternative views and process with some shared elements and many opposing views about what works best.

My Key takeaways?

  • The design of the process matters less than the approval of the process by stakeholders – which makes it legitimate. If everyone believes they can get a fair hearing, then the process is a good one.
  • We need to do more work understanding how to manage technical detail vs how to manage values. The skills and knowledge applied to each is quite different. Ideally diverse perspectives are applied in each case.
  • Independent and fair minded decision makers are important arbiters, but insufficient advocates. The ideal folk at the heart of the process are those who care deeply, have great credibility amongst those they advocate for, but who have that undervalued skill of being able to develop constructive dialogue with opposing interests.

please find my report from the journey below:

As background, the first few price resets for the business were typical (2002 to 2012). Economic indicators suggested Scottish Water could improve efficiencies when benchmarked against other utilities, Scottish Water provided detailed business planning and the regulator trawled through the detail looking for (and finding) areas of improvement. The incentives on the regulator were to make a case for lower prices/better service while also appearing reasonable.

As the room for productivity improvements became less clear cut, the ability for the regulator to make useful improvements to the water business decreased. In Florida, a consumer-led negotiation achieved more in price reductions than the regulator could have. Could this be true? And how?

Perspectives on stakeholder engagement

The libertarian academics argue that creating a consumer negotiation achieves two things –

1) providing the Utility with much truer insights into consumer priorities and values, thus validating opportunities to reduce costs/improve value against a litmus test of what consumers really think constitutes long term value.

2) taking the regulator as a middle man to the side of the process and therefore creating efficiency in the aim of delivering long term value by forcing the utility into direct decision making with its stakeholders.

This is an economics perspective.

A public policy perspective would be that helping stakeholders deliberate leads to better decisions. Empowering stakeholders to resolve their own differences and make decisions together is the most highly regarded approach across the engagement (IAP2) spectrum. In this context there are two dimensions (thanks Stephen Littlechild) the negotiation between SA Water and all consumers/regulator determines the size of the pie. The negotiation between different consumer priorities helps inform how the pie is shared. Questions about the level of detail needed to have such discussions and the timing of decisions (just for regulatory process vs ongoing) come into view about how successful stakeholder involvement can be.

An innovation perspective argues that user-led design provides the business with “outside-the-square” perspectives and allows it to learn and innovate for better outcomes. It is all too easy for the business, the regulator and all those who develop water sector expertise to be captured by the current paradigm. Improvements based on industry trends are easy, but adoptions from other sectors and coping with disruptive changes can benefit greatly from working with outsiders. OfWat talked about moving toward a co-design culture and highlighted a Welsh village which worked with its utility to agree the best way to manage a pipe replacement program that would have disrupted the whole village.

Finally, a management perspective recognises that good decisions are made within a collaborative organisation – and business planning should engage all parts of the organisation as stakeholders. This makes everyone more aware of the different trade-offs that are needed across the organisation and the higher aims that all departments contribute to. A customer centric approach extends the organisational sensemaking beyond staff to all the customers they affect every day. It also puts customer/stakeholder values as the chief aim from which all ambitions for long term, sustainable outcomes flow.

There is plenty of nuance in creating a successful process. Our visit highlighted many elements that contributed to the success in Scotland and helped us consider how these may be generated in South Australia. It is clear that transplanting the process from one jurisdiction to another cannot guarantee success. One of the best reasons for aspiring to negotiated settlement is the similarity of the Scottish situation to our own. A single, publicly-owned water utility, a regulator with only one water business to regulate and a small jurisdiction with the opportunity for strong relationships.

At the heart of the Scottish negotiated settlement process is collaboration and a move away from old frameworks of advocacy and making demands (power over) to one of constructive challenge, scrutiny and negotiation (power with). This is an enormous ask. The culture for collaboration can only be built slowly. Shared success and the sharing of power, slowly build trust – trust that the process works and trust in the people to play their roles well. Relationship building comes before trust can be guaranteed and before conversations can become honest enough.

Interestingly, the American examples seem to balance hard nosed negotiation, resort to litigation and stronger joint understanding between customers and businesses. Collaborative progress does not seem to be at the heart of the US processes and when quizzed on this, Stephen Littlechild acknowledged that Americans have a stronger acceptance of private sector ownership and expectation that the key to success in business is good customer service. One of the concerns of the SA group was that a business can “capture” consumer negotiators in much the same way as it captures regulators. Outside parties never get to see information the business does not want them to see. If consumers agree with the negotiated result, can it be a bad result? Probably so – with grave concern that information asymmetry always benefits the business. The acceptability test becomes quite important. Tony Smith at CC Water pointed out that the water businesses had performed better than the FTSE. If they felt the regulatory process was too limiting, they could take their money elsewhere – but he felt they wouldn’t when profits were quite obviously reasonable. The issue of Thames Water shifting profits offshore was raised (even the Financial Times felt this showed the system was broken) and business behaviours like offshoring profits really do undermine the business’s social license. One benefit of a process with stronger customer involvement might be in increasing the power of customers to revoke social license.

The Scottish Water process appeared successful from the outset but during the first phase, “learning” there was little at stake in decision making terms. Trust was built as Scottish Water realised the ‘daft laddy’ questions to present proposed decisions at high level and in terms of customer value were valid and actually improved the business in how they thought about their work and communicated it. The willingness of Scottish Water to reflect on criticism and bring better information back to the Customer Forum built trust and demonstrated that the business was listening.

There is probably a year in this first phase that helped create the relationships. All three senior leaders – the Chair of the Customer Forum, CEO of Scottish Water and CEO of WICS have an excellent rapport and commitment to making the process work with honest conversations and plenty of out-of-session communications. This culture-making from the top is really important. It reminds me that the best teams perform when team members can openly challenge each other without reducing the strength of the relationships.

 

Insights

Others have written about the process so I will not provide detail. A number of design features were highlighted by those we talked to.

– aligned objectives. Broadly stable prices over the long term appears to be an agreed policy objective that brooks no argument. A customer orientation by Scottish Water (new at the time but strategically part of who the organisation wanted to become) helps set the tone for a positive relationship with the CF. WICS assertion that customer values are essential to priority setting is easy for all parties to accept.

– clarity on role. Policy – which could be contentious, had already been set by the Scottish Government. The tram tracks (band of acceptable financial outcomes) had been provided by WICS.

– diversity of perspectives. Many well respected senior folk and a few newer faces make up the Customer Forum. All have been chosen for their ability to think constructively together, to scrutinise, analyse and challenge and to ultimately make agreed judgement for long term public benefit. Some have only a lay perspective with no expertise in water.

– no one on the Forum as a representative. This provides a filtering effect to move away from what can be short term demands and feelings to a longer term deliberative judgment.

– excellent well respected Chair. “Peter ran the forum like a parliamentary committee” “don’t give the position to someone who is out to make a name for themselves”

– tripartied appointment of the Chair between WICS, SW and CAS

– performance indicators. Arguably the most powerful impact of the customer forum in Scotland has been in showing the business what customer expectations they need to perform to and negotiating new, customer oriented performance indicators.

– jointly agreed customer research. There were times when CAS commissioned independent research too but in general there was great benefit in the CF and SW jointly agreeing the research, questions, interpretation of results.

 

(the ongoing role of CAS is interesting. It has been able to remain strongly in its advocate and representative role. It has been able to continue pushing for change in government water policies and in the business approaches. But Gail Walker spoke highly of the stronger working relationship. The fact that many of the customer principles and approaches that she had been advocating for over many years, had been accepted by the business, “lock stock and barrel” seemed to be testament to the customer forum approach having an influence over the business and paving the way for new ways of thinking about consumer needs.)

 

One conclusion needs to be that a genuine collaboration between SA Water and a customer forum would lead to long term benefits for consumers, better decision making on investment and service priorities and a more open and customer focused organisation. Scottish Water suggested they saw major corporate benefits and would comfortably continue to resource this approach. The level of funding was considered “5m when a regulatory reset was a seperate line item, it is now integrated into the business in so many ways that if it is more than that, it would still be worthwhile.”

 

The OfWat processes are different in England and Wales. The proposals endorsed by Customer Challenge Panels may not be taken into account by OfWat in the final determination. The CCPs’ main role is to report to the regulator about the effectiveness of the Water business’s customer engagement. Strictly speaking, if the business is listening to its customers well, their priorities will inform the business plan. Regardless of the differences, both jurisdictions believed that turning the water businesses to face their customers was leading to improved businesses. In England and Wales, the regulator can easily see this impact with differing results across the 17 or so businesses under regulation. One comment was that about half of these businesses might drop customer engagement tomorrow if the regulator didn’t force them to do it – these were not considered the best performing businesses.

 

We were also able to talk to an independent academic, Martin Lodge, who could contrast the WICS and OfWat processes. One takeaway from that discussion was that the detail within the process was less important than the endorsement of all the actors within the process. Ie legitimacy becomes a key part of process design, and if everyone can agree that a process will get good results, they will work toward that.

Another important point that Martin made relates to how well the system works when the issues at play create deeper divisions. He gave the example of the aviation airspace regulation and concluded that having the ability to revert to the regulator as ultimate judge becomes an important fallback in the context of difficult decisions.

 

So a number of key questions need to be asked:

  • how do we make sure new approaches deliver better decision making?
  • how do we build a genuine collaboration? (and a realistic timeframe/resource for this)
  • who will provide the best reflection of consumers long term interests?
  • what new roles should we envisage for the existing actors?
  • what is an efficient use of everyone’s time?
  • how much detail is enough to launch an effective challenge?

 

Better Decision Making

I believe in the following key components:

  • Don’t underestimate the power of diversity. Water folk all labour under a water infrastructure paradigm. Economists see the world in a certain way. We need these dominant types to try hard at creating a shared view of the challenges and potential solution, only partly through schooling others about their world view and more importantly by thinking through the impact of other world views on their perception of the issues.
  • Anyone can give good advice about the way they would make a decision if they are given time to understand the trade offs and deliberate over the issues.
    • This means we shouldn’t dismiss people’s views just because they are non-expert. It is our responsibility to define issues in terms of the customer value trade-offs that we are asking about.
    • It means we shouldn’t dismiss advocates just because they start from an extreme and uncompromising point of view. What we can ask of advocates is that they approach conversations with respect and that they believe in the good-will of both sides in a debate.
  • We need to see the decisions that are made throughout SA Water all the time and challenge the business to do a good job of articulating customer values so that all decisions can be confidently framed for customer outcomes.
    • Note that Scottish Water was sending its operational staff out to do customer interviews, understanding that everyone in the business needs to improve their understanding of those they serve.
    • Note the 9 criteria by which OfWat will evaluate PR19. These criteria provide an interesting list of ‘customer value’
      •  engaging customers;
      •  addressing affordability and vulnerability;
      •  delivering outcomes for customers;
      •  securing long-term resilience;
      •  targeted controls, markets and innovation;
      •  securing cost efficiency;
      •  aligning risk and return;
      •  accounting for past delivery; and
      •  securing confidence and assurance.

 

Collaboration

  • The best collaborative culture will take time to establish
  • There is always risk of capture.
  • Strong relationships that can survive robust challenge and differing points of view are essential.
  • The ultimate goal should be a porous organisation that is collaborating with stakeholders and customers at all levels simply because SA Water works better that way. The internal processes that establish this culture and listen to staff who will have their own customer insights are equally important to any high level processes established under the banner of ‘customer engagement’.

Choosing the negotiating team

The negotiating team can be understood in a similar way to a board. A board acts in the interests of the business. It has access only to high level information but operates with high levels of trust through the CEO to see that the business performs well. Shareholders elect the best board they can because they know that the right diversity of skills and perspectives working as a team will ‘steer’ the organisation in the right direction. The board is expected to be networked and knowledgeable, act strategically, manage risks, monitor performance and set goals. They are expected to be able to dive into the detail and challenge the business when things go wrong. To manage all this at a high level the board needs to monitor performance and also be concerned about the systems and processes that reliably produce the intended results.

 

The negotiating team needs to act like a board which is tasked with stakeholder outcomes, ie the best interests of all South Australians. It needs to be clear when the organisation acting in its own interests is likely to contradict customer interests and it needs to be given access to information when required to dive into the detail around issues that raise concerns.

 

There seem to be three key elements of each individual to consider:

  • Passions: What do they care about? What is their world view? Do we trust that these passions can be aligned with the long term interests of all South Australians? Will this give them a ‘strong backbone’ when pushing for the outcomes to be the best they possibly can be? Who will be the beneficiaries of any discretionary effort that this passion unlocks?
  • Incentives: How will they be compensated? Is their reputation at stake? Will doing/keeping the job override their passions? (ie not a good outcome)
  • Skills: Can they be tough negotiators? Can they understand the detail sufficiently to challenge it? (see also ‘how much detail?’) Do they have the interpersonal skills to create a good productive environment? Will they succeed in improving the way SA Water understands, communicates and measures customer value?

 

 

Role of existing representatives

The process is legitimised by existing representatives and their trust in the outcomes is important. While everyone retains their right to advocate for stronger outcomes for their stakeholders, the chances of achieving these improve if they are considered from the outset. Damning feedback/submissions at the end of the process would suggest that the process has failed.

The work of designing future pathways is always a process of bringing everyone on a journey, or at least the majority. The negotiators must bring the existing representative bodies along and those bodies must bring their constituencies along too.

People may not agree, but they must, at the minimum, understand why decisions have been made and they must feel listened to.

 

 

Efficiency

An overwhelming amount of advocate and customer time appears to be taken up by the proposed process. This is hard to justify in a small jurisdiction like South Australia.

At an individual level, an advocate or irate customer champions something they care about. The level of time and effort they choose to invest can demonstrate how important the issue is to them and also reflects the the amount of time and effort they have available. Those with less availability want their interactions with the process to be as efficient as possible or they want to trust a process where sufficient resources are applied to dealing with the issues they raise.

The SA Water and regulatory cost-benefit is quite different. In the context of billion$ expenditures and asset base, small additional investments in planning and design can pay dividends. If the business is oriented to:

  • Delivering efficiently
  • Delivering the right things
  • Innovating and planning effectively for the future

Then everyone is better off.

 

Models for consideration:

  • The public policy and regulatory consultation models are well understood but may not be considered efficient or effective
  • Citizens juries place high value on deliberation and do not question the time intensiveness of the process
  • Co-design and user-led design funds professional design expertise to be the listeners and testers of outcomes. It recognises that design is an iterative process and that users don’t always think through their choices but their behaviour speaks volumes about their values.

 

How much detail is sufficient?

There was much talk about ‘looking under the bonnet’ and improving how much visibility and understanding was afforded to the negotiators. This metaphor can be extended. If an innovative future is to be adequately considered, other insights might need to be included to explore alternative arrangements of the components under the bonnet.

 

Agenda setting is also a critical issue. If SA Water sets the agenda, the negotiating panel may never get to see aspects of the business that are worth challenging. In Scotland the regulator deliberately designed a number of brainstorming sessions between stakeholders, policy makers and regulators to explore issues that it saw as worthy of broader discussion.

The process builds on the status quo. Is this acceptable? When should this be challenged? It could be argued that the existing social contract may not be up for challenge, but it should always be visible and SA Water should be able to articulate it clearly in terms of the long term value it produces.

 

Some folk will burrow into the detail and sometimes this is necessary to challenge the basic assumptions that SA Water uses. The negotiating team can improve the way information is framed and Scottish Water highlighted the improvements it had made as it got better at understanding how to deliver its information in terms of customer value. It had also changed its performance measures, so that conversation about what the organisation is trying to deliver is likely to change.

 

Like a board, managing and communicating trade-offs at the high level is essential to most of the smooth operation of the process. Using the ‘burrowers’, applying additional resources/expertise to problematic areas and being prepared to go into detail when necessary is also important. How to know when to dive deeper? Like a board, the negotiators need to have good visibility to how well the SA Water processes work and they need intelligence from other sources to monitor the organisation and its customer engagement.

 

Appendix: Consumer Principles developed by CAS, consumer water advocates in Scotland

CAS principles

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Future energy – People want in

I gave a Western Australian audience a whirlwind tour of community energy last week. My talk below was actually much shorter, but these are all the things I wanted to say.

Most importantly, I wanted to be sensitive to the feelings of a coal mining and coal power station based town, Collie. The Shire is trying hard to start a conversation about alternative economic activities, but the reality is a town that powers 50% of the SW of WA has relied on its centralised dollop of energy to produce wealth and in the renewable future, the energy wealth will be spread around more. I suspect the 10-15 year life of the coal assets would be much shorter if the renewables juggernaut has its way. Time will tell if anyone in the community or government has the courage to prepare for this possibility.

Western Australia is a strange market. The government has attempted to introduce competition but many constraints, corporate power (govt. is the shareholder) and government decisions are slowing down the investment in renewable energy.

My biggest takeaway was that consumers want to be part of the energy future. Horizon, Western power and Synergy all acknowledge this, as do the state and local governments. It causes both friction and hope.

You can find my powerpoint here. Please enjoy the speech below.

powering

What a lot is changing in our energy system at the moment.

Its ‘game on’ for renewable energy. Prices are falling, every time the cost-effectiveness of projects change, new opportunities emerge.
It’s ‘game on’ for distributed energy too. We are staring with so many rooftop solar system and if you think of solar and batteries as the technologies of this decade and they both work well at a small scale, distributed amongst the energy consumers.

And I think its ‘game on’ for communities as well because most of us are not feeling comfortable about the shape our energy transition is taking. And for me, community involvement is the defining feature of community energy.

Let me do a quick poll – who here would say that things are moving too fast? not fast enough? And finally – who is worried about where we might end up?

I’ve been looking at community energy around the world – here is where I went on my Churchill Fellowship. I wanted to know whether all these great towns and cities – some achieving 100% renewable energy, some battling their local politicians and energy corporations for more renewable energy. I wanted to know if they were knitted in to the system, if their changes were part of the larger energy transition.

And I’ve been looking at the emergence of community energy here as well. Australia now has over 100 community energy groups and 70 community energy projects in most parts of the country.

together we are going to take a journey through some of the stories these communities tell.

Because stories are a theme. Every community has them. Every place has an energy story to tell. Next time you come to somewhere for the first time, ask yourself why the place is there… and look around for the signs that it has been shaped by its energy story. I traveled to many regional towns whose wealth and prosperity had been premised on agriculture – in an era when energy resources were distributed. At the beginning of the 20th century Australia might have been the most urbanised country on earth – our centralised cities and big dollops of centralised energy go hand in hand. But this renewable revolution represents something quite novel for our regional towns, distributed energy can give our places new stories.

And each story is unique. The resources we access, the challenges we face – they all differ from place to place. Importantly, how we go about solving them differs hugely as well and I don’t know if its a good or bad thing that many of our communities in the sector seem to be starting from scratch. I like to think of it as a sign that we are in the entrepreneurial phase and there is plenty of innovation because there needs to be.

So, of course, at the heart of these unique stories we find heroes, champions, community leaders

Let me introduce you to Lisa, Matt, Margaret, Chris and Alison. They would all hasten to add that they are only part of the story. They would credit all of the people who have worked hard with them.
People like these guys are the gold behind community energy – they’ve stepped up to make good things happen and it is their stories that inspire others. If you are looking for heroes in your story – think about these descriptions

The far seeing people. Some people can sense the future much sooner than those around them.
The people with lousy timing, in many ways the early adopters of solar should have waited, things would have been much cheaper – but where would we be now if they hadn’t been out there advocating for solar 20 years ago?
The guards of the drawer, because the difference between communities that made great strides and those that had plans but hadn’t acted on them was the action plans and targets were allowed to be parked in the bottom drawer. The guards of the drawer stopped this.
chris weir bendigo sgAnd Chris Weir from Bendigo sustainability group likes to talk about his Ninja team. He says the best groups have a small group of hardworkers at the heart and they cover four main skill sets – project management, finance, technical and comms.
Chris and his group have been active for a decade and they’ve just become a community energy hub with some funding from the state government – Chris really hopes this will give them some dedicated capacity to ramp up their activities.

Lisa Lumsden repower pt augustaI thought I would start with a story of a community for whom the energy transition was moving too fast. When Lisa Lumsden tells this story she says, “but first I must go back to the beginning” because outsiders don’t understand what it is like to live in a town where the work generated by two coal fired power stations and a coal mine have dominated the town for over 50 years. And the relationship was not all one way, Port Augusta’s fierce mayor, Joy Balusch had fought for years to hold the power stations to account and improve the pollution coming into town. So when Lisa sat down at a town meeting to hear about solar thermal in 2011, it was with an open mind. The town knew that the power stations and mine would close in 2017 unless major investment could be justified and here was a proposal that created baseload power to replace a coal fired power station and it created jobs – because making mirrors could be an industry where much of the value stayed in South Australia.
Lisa slowly got drawn into the campaign. She had the hard conversations with people about the eventual loss of the power stations and the need for the town to take the future into its own hands. She remained perpetually surprised by the amount of support they got from around the country for the work of Repower Port Augusta. For a long time there seemed to be little political support. They had managed to get interest from all around the world and solar thermal suppliers from Spain, from the USA were visiting Port Augusta and checking it out, but little help from state or federal government. The power stations closed suddenly, a year early and no transition plan was in place. In early 2016, these were dark days. All their hopes seemed to hinge on a single opportunity for Government to include solar thermal in its own contract for buying electricity.
And finally, with an election in sight, an infamous blackout behind it, rallies and billboard advertising in Adelaide, the state government announced what many thought would never happen. Port Augusta will get its solar thermal power station, and at a reasonable price – 7.8c/kWh. The Premier at the time went to Port Augusta to acknowledge that this was a community victory. The local member for Port Augusta is our new Energy minister.

Now, if you look at the region of Port Augusta there is an absolute hub of activity. They will have employment for years if all the proposed projects come to fruition. None of it is community owned energy but the leadership shown by the town ticks my box for changing the outcomes. How much of this would have occurred anyway? Well there is no doubt that the infrastructure from the old coal fired power stations is the main reason the developers are here but Repower Port Augusta gave this town the profile it needed across the globe and without that movement, the welcome mat would not have been laid out for developers.

For Margaret and Matt – the energy transition is not happening fast enough.
margaret hender corenaIn 2012, Margaret was one of those not-from-port-augusta folks who did the 200km walk for solar from port augusta to adelaide to demand a faster transition. And with time on their hands, they talked about how to make it easy for everyone to make a practical contribution to reducing emissions. This is the birth of Citizens Own Renewable Energy Network Australia, CORENA – an organisation that puts solar on the roofs of community buildings by offering technical support and interest free loans.

When you look at the community energy sector, many groups have yet to build their first project. Some have one or two. But two organisations have Over 20. CORENA and clearsky solar. CORENA is a donation model. They have built up a fund of over $150,000 in donations. Because loans get repaid and the money can be lent over and over, they have now lent over 287,000 to solar and energy efficiency projects. Clearsky is an investment model. They find the project and call for investors, with returns typically offered in the range of 5-8%. Their investments sell out quickly, sometimes in less than 24hrs – and one of the things that pleases them is that they are making solar appealing to people from all backgrounds and all political persuasions.
Both of these models are speeding change with community funds and technical support.

matt CJ TRYMatt was one of CORENAs earliest customers. He helped get solar panels funded for Beechworth’s Montessori School but his real passion was in Yackandandah. The local petrol station in Yack is community owned. When the petrol station threatened to close in 2002, there were plenty who didn’t want to drive 40minutes just to fill up a tank. Matt convinced the Yackandanadah community development company to put solar panels on the roof of the petrol station and from that core group that rescued the petrol station came a conversation about their energy future. Soon they had a goal to be totally renewable by 2022 and TRY was born.

They’ve engaged the whole town. The local hospital also received a CORENA loan. It and the local water treatment plant both have solar panels and they’ve been running energy audits throughout town and awarding Golden Yaks to their best performers.

And their hard work has been rewarded with growing support from councils, governments and energy companies. They are currently in the midst of a minigrid roll out with their distributor – Ausnet services. They have been putting solar and batteries throughout a newish suburb with some control over the batteries, for energy reliability purposes, handed back to Ausnet. Finding a way for the energy company and the community to benefit is a Nirvana and that leads us to….

My final story and my favourite. We’ve seen that the drivers that get communities passionate can be quite different, from the energy transition going too fast, to it going too slow. And we’ve seen that the strongest community leadership often forms in response to a crisis. But my last story is about the importance of listening – because when you listen to what your community needs, you get the richest response.

alison crook enovaMeet Alison. Alison comes from the Northern Rivers region of NSW, a region that was appalled by fracking and successfully shut it out of the region. Alison, like many others, felt that while it was important to oppose fossil fuel development, it was also important to be part of the solution – so a group of them all trooped off to the first Community Energy Congress in 2014 and came home all inspired, ready to build a big community owned solar power station. But the more they investigated what this project would look like, the more people told them, we can build the power station but what we really need is a friendly retailer.
You probably need rocks in your head to even contemplate building a brand new energy company in the competitive, ‘big boys’ landscape of energy retailers, but these are competent, determined people, not afraid of a few headaches along the way so creating Australia’s first community energy retailer is what they set out to do.

And here are some of the things I love about ENOVA
– they are a company, not an NGO. But to make sure they remain democratically controlled, the most votes anyone can have is 3 – even though some shareholders own much more than 3 shares
– they told their shareholders during the original share offer (where they raised $3m) that everyone would get half the normal dividends and half would be reserved for a not-for-profit, Enova Community which would help everyone in the community reduce their energy costs with energy advice and other helpful energy services.
– they worked out that if their region spends $300m in electricity charges, they could help keep $80m in the region. For a start all the retail charges convert into local jobs because ENOVA has located its entire business operations in the Northern Rivers. And by buying locally generated energy, by helping customers keep their energy use and energy charges low, all these elements contribute to a locally owned and operated system that genuinely services its community.

At the end of the day, isn’t that what we want? An energy system in service to its customers, towns and regions.

That is what Enova’s story is about. It is what you get when a community is concerned that the energy transition isn’t quite going in the right direction and they stand up to correct it.

So I hope the stories I’ve told help you understand what community energy can be for you. I hope you are already thinking about the unique assets and challenges your community has and pinpointing a few potential community leaders. Unless your community is completely complacent about the changes going on in our energy system – there are plenty of concerns to kick start a conversation about what the energy future looks like.

And everyone who is paying attention will notice that I slipped in a 7th theme there – public good! What I mean by that is there are opportunities in this energy transition to deliver benefits that a market struggles to provide and governments aren’t paying enough attention to. There are public benefits, for example ways we could share our rooftop solar or our emergency battery capacity? Ways we could help lower the bills on our community buildings, ways we could look after the most vulnerable members of our society, many of whom risk falling into energy poverty. We can already see in the examples of Yackandandah and Enova that community groups are choosing to unlock these benefits and I believe the best model for unlocking these benefits is Government funding and community delivery.

 

So as we watch our energy transition play out and as we watch significant financial and political resources lurch our systems toward change, we have to ask the question – can communities’ and their limited resources even influence this?

I believe they can and I believe community energy plays an essential role in nudging our energy system toward better outcomes.

 

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Who supports community energy?

CE election.pngLast week 7 community energy organisations wrote to the key political parties about community energy.

Everyone is making announcements in the energy policy space but do they really understand how excellent a community energy policy could be? It is not enough to throw money at individuals or big corporates without working on the collective challenges that we face at a local level. Working with communities to make our energy systems better would be a win-win-win, as I’ve written in numerous places on this blog[1][2][3].

We got replies.

The Greens are an excellent bunch. Mark Parnell read the letter, the blog and agreed to use their balance of power position in the Upper House to influence the decision makers of the next term and advance community energy. They’ve also signed up to the Repower agenda on community and renewable energy proposed by Environment groups and a public benefit electricity retailer has been Green party policy for some time.

I have plenty of time for the Dignity Party.  They have recognised that working through community would align with their agenda of tackling disadvantage and they have written back thoughtfully and supportively. Their energy and climate policies recognise that vulnerable South Australians are further disadvantaged unless we embrace an energy transition that works for everyone.

SA Best provided a disappointing, standard reply along with their energy and environment policies which are both pretty good. They have made headlines with their community benefit retailer proposal, which will help raise the profile of the idea with the major parties and they have agreed with much of the Repower agenda. They have emphasised the importance of energy efficiency, which you can do well via community. They also have an interesting group of candidates – I have plenty of time for folk with a track record of working in community and/or advancing renewable energy.

Labor were the only other party that replied. They have a bad habit of not answering questions and promoting their own agenda. I am not convinced the community energy message has been heard in the inner Labor circles, despite our repeated attempts. While I approve of much of the Labor party energy policy, I despair for the lack of attention to issues that are harder work, like energy efficiency, like supply/demand balancing, like community work.

While the Liberals didn’t reply, they gave positive responses to some of the Repower proposals and they have modelled their energy policy on the Finkel Review – which has much to commend it. I was pleased to see demand management explicitly mentioned.

I can’t recommend Australian Conservatives because they haven’t taken the effort to clarify their position. Curtailing renewables feels like an ideological position and at odds with the stated aim of reducing energy costs. I was hopeful that provision in partnership with community would appeal – improving energy independence and empowering regional communities could both align well with a conservative agenda.

I’ve pulled together the party policies as they apply to the 11 areas of community energy support we advocated for last week.

Please peruse, please use your vote wisely, please tell candidates that they should advocate for a community energy policy within their party and I’ll see you on the other side of March 17!

PS Please share. If you would like to keep informed about community energy progress in SA, you can sign up to keep up to date with South Australian energy news and/or join our Facebook conversation at Community Energy Action SA.
[1] Why parties should support community energy
[2] The case for community energy
[3] A community energy program for resilient hills and coasts

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Deep Work – can I summon it?

deepwork2 I understand the value of deep work, the opportunity to truly focus and to create the space to do so. But I’m not sure I could give it the priority Cal Newport does.

That’s the point though, isn’t it? Deep work isn’t something you can do part time, and so this book leaves me with somewhat of a dilemma.

Newport does offer a number of models though – His own involves effective blocking out of time where no distractions are allowed; going to a retreat may be useful for those whose day-to-day will never be distraction free; and separating the pattern of the year so that interacting activities (eg teaching) are only for part of the year is also an option.

At the start is a very insightful story about how Newport trained himself. Building the habit to sink into deep work is another challenge many of us have because distractions feed the gratification monkey as we try to push ourselves over the initial hurdles and into the state of flow and concentration. Newport describes a building design that an architect once described to him. Two preparatory chambers allow users to firstly socialise and discuss the work ahead, then gather all the necessary resources from an uber-library before finding oneself in an inner sanctum of silence, motivation and time. I want one!

Deep work is valuable, rare and meaningful. You don’t need to sell me on this but I appreciated the first half of the book for comprehensively making the case. The challenge is there, for all of us – if deep work is so good, how much of our lives should we spend on it?

This remains my key question. Newport’s assertion about how much he got done when he really focused is impressive and he acknowledges that maybe he pushed a little too hard and the year was quite exhausting.

He celebrates the boundaries – coming home and reading in the evening, finding time to relax and be with this family. If you’ve read CEO of Me, then you’ll know that folk suit different styles in the life/work blend. He actively acknowledges family as an important element to the thinking about deep work and where to fit it, and made me question whether it was fair to accuse him of having no idea what it is like to be the ‘on call’ parent.

And I wonder about the rules, because they made me think – what is life for?

  1. #work deeply
  2. #embrace boredom
  3. #quit social media
  4. #drain the shallows

But I won’t dismiss the concepts straight away because I acknowledge that there is a need for deep work in my life – if not at the extremes practiced by Newport.

 

 

 

 

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