Sunday, October 30, 2011
When I am not musing on DOD energy policy, programs and machinations, I try to run a business advising commercial entities on what that market looks like and what it is likely to do.
With many of the manufacturing and technology companies, I am asked about the Buy American Act. As in everything DOD, it is intricate, convoluted and understanding it will make your head hurt. I could explain it here, but somethings come with a price tag.
That being said, I couldn't resist the photo shown above, sent in by an alert Scout. Literally. The most American of groups (the Scouts) visited the most American of buildings (the Pentagon) and bought a memento of their visit. That it was a tool for conserving resources (water bottle) was secondary to having something from the Most Admired Institution (the Military).
If only it could have been made in Canton, Ohio instead of Guangdong, China.
Friday, October 28, 2011
My handsome younger brother, Jon Gensler, combat veteran, former tank and mortar platoon leader, and current energy entrepreneur weighs in on speed in energy goal attainment by DOD. Given Solyndra and recent DOD IG reports to the contrary, Gensler argues that speed in government energy efforts are necessary for the country. Project velocity ( the speed at which you can push, pull, or coerce a large scale project through contracting, design, negotiations, procurement and the various other hurdles that underpin any large scale opportunity) can be accelerated through breeching or by passing the obstacles presented by site procurement interpretation, decision maker inertia, Power Purchase Agreements (PPA) complexity.
For a guy with a meager education, (USMA, MIT, Harvard) he makes good points. Recommended reading for anyone in the industry AND Government. Especially Government. The Army is attempting to address these with the EITF which is sponsoring a three hour meeting next week in DC. This will be an opportunity to ask new TF Executive Director, John Lushetsky, former DAS Energy Efficiency and Solar Program Manager at DOE, questions based on Gensler’s article.
One of my scouts was attending FUPWG this week in Philly. Early reports indicate that there is still some disagreement on long term PPAs among the Services. Would be useful to have a definitive statement from Dorothy Robyn, Deputy Under Secretary of Defense Installations & Environment on the issue. Please sort out U.S. Code 2922A, Madam Secretary, and I won’t ask for anything else for Christmas. Promise. Dan Nolan
Monday, October 24, 2011
On Feb. 17 2009, Congress passed the American Recovery and Reinvestment Act. President Obama signed it into law four days later. As part of the stimulus package DOD received funds to support various renewable energy projects. Because of the nature of the funding, many renewable energy projects classified as Military Construction (greater than $750K), got funded very fast. As any one familiar with MilCon will tell you, this is normally a laborious and much scrutinized process. Years are spent in planning and preparation before a project is "shovel ready". But what happens if you don’t do that? Some predictable bad things.
Annie Snider has an excellent piece on a series of DOD IG reports addressing $117M received by AF and DON. (This article is outside the usual paywall; the really good stuff is on the other side.) Turns out if you want it bad, you get it bad. Windmills without wind, in front of radar; ROI rules that were unwritten and many senior positions in DOD vacant when decisions were required. If that weren’t enough of a recipe for less than sterling outcomes, compressed timelines forced decisions to be made before their time.
It is a shame that every dollar of the $335.7M earmarked for RE didn’t work 10% better than the proposal required and that the return on investment wasn’t 40% with a nine month payback. Damn shame. But what must be remembered was what ARRA was supposed to do. It was supposed get people working and money into the economy. Regardless of your opinion of the act, it did those things. What DOD got out of it was lessons learned. The DOD board that now clears RE projects to ensure that they do not detract from the mission and the Army’s Energy Initiative Task Force are examples of those lessons. Let’s hope they can reduce the errors in future projects.
What should bother us about the article is the lack of response from OSD in addressing the issue, specifically Dr. Robyn's office. I checked with Ms. Snider. She queried them, but they had no comment for record. If DOD has learned anything from previously bad events, it is to address it up front. When this stuff comes out, get it out. Tell us what you know, what you don’t know and what you are doing about what you don’t know. DON's Tom Hicks is always accessible and we appreciate his candor. The rest of the folks could take a cue. Why should OSD do this? If the Army wants $7.1B in private investment, they (and the rest of DOD) need to engender trust. Transparency goes a long way to doing just that. Other wise the press has only old retire guys with whom to talk. Dan Nolan
Thursday, October 20, 2011
Just returned from a Military Smart MicroGrid Conference in D.C. that once and for all settled on the fifteen acceptable definitions for a smart microgid. What a relief that is! In essence, a smart microgrid is smaller than a minigrid and bigger than a nanogird (right, Dr. Cross?). It can accept any kind of power (DC, AC, Super), store it, and dispatch it instantaneously, independent of the commercial grid, while being omniscient, omnipresent and omnibenevolent. With briefings from every branch of the Federal Government, except the Post Office, the discussions were far ranging, sometimes frustrating but always educational.
The current major player on the block for DOD is, of course, SPIDERS, one of fortyeleven MG projects ongoing for the Department. The project manager (technical), Harold Sanborn attended, but did not speak. Since he is standing by to accept a deluge of proposals for Phase 1 he had to attend the conference wearing a gag as stipulated by FAR 100X02.z24.$$. But I could still see him smiling behind the gag.
Ihave been critical of many of the Department’s efforts in energy purely because it has just not been fast enough to satisfy me. I reflected on this after I went up to speak with ASD, OEPP Sharon Burke following her excellent presentation and she asked me if I was going to punch her. It kinda hurt my heart. So I would like to write a love note to all the DOD energy bubbas and bubbettes I have abused this past year.
To all of you who have taken on the thankless job of attempting to transform the most intransigent and prolific energy user in the nation: Thank You. What you do on a daily basis has the potential for transforming the Nation and resolving one of the four great challenges Tom Friedman and Micheal Mandelbaum enumerated in their excellent book, “That Use to be Us”. If you haven’t read it, get it, read it and then we will discuss.
DOD is the ultimate camel maker. We asked for a horse, they went into committee and we got a camel. If we were asking for a speedy steed that could win the Derby, we are disappointed. But if we wanted a beast of burden that could carry a heavy load with great efficiency, we are happy. As we watch the various products come out of OSD and the Joint world, we (I) have to accept that it will always be product of compromise. Whether it is a strategy or a less than optimal RFP, it is what can make it out of committee. Compared with what is coming out of the Legislature these days, the OSD energy crews are craftsmen.
Now don’t worry. This does not mean I will not return to being my crotchety old self. Andy Rooney retired, I did not. I am still going to call them the way I see them. If it is a low velocity marshmallow, I will say so. Just wanted our government readers to know that I do appreciate how hard the work is and how, sometime, you have to make it look like someone else’s idea. Thanks, Harold for always having a smile on your face and thanks, Ms Burke, for the herculean task that you take on daily without ever letting them see you sweat. The picture above is her visiting troops in Bagram. When she talk about visiting our wounded heroes at Landstuhl, you can hear the passion for what she does in her voice.
OK, everyone back on your heads! IDGA 3rd Annual Alternative Energy for Defense next week in DC. Be there! Dan Nolan
Monday, October 17, 2011
This past week, the Association of the United States Army gathered in Washington, D.C. for their annual meeting and exposition with the theme: “The Strength of the Nation”. Every star and luminary of the Army attended as did every major defense contractor, innovative technologist and U.S. Government office with a need to see and be seen. From tiny Power Breezer off in a far corner to the giants like Northrop Grumman and Lockheed Martin, the show filled all of the massive Washington Convention Center. In a time when one would have thought that the industry would be conserving resources, they appear to be doubling down. I was interested to see how energy would be reflected in products on display so I hit the floor and started asking question.
One of the areas I asked about was the impact of the energy on acquisition decisions. The requirement to use the fully burdened cost of energy in the Analysis of Alternatives process and to consider energy as a Key Performance Parameter have been in place for some time, but to what affect? I spoke with folks from corporations with interest in the ongoing Joint Light Tactical Vehicle Program, one of the pilot technologies for evaluating the efficacy of FBCE. When I asked how energy efficiency had impacted their considerations in developing their prototype, the vendor said it was a major consideration, but at this time it was kind of like asking if you preferred the portholes opened or closed on the Titanic.
According to a Congressional Research Service report on the JLTV, “once testing was to be completed and technology requirements established, a full and open competition was expected to be conducted in the late summer, 2011 for the Engineering and Manufacturing Development (EMD) Phase and the Department of Defense (DOD) planned to award two contracts for the EMD phase, which was scheduled to last 24 months”. However, in February 2011, the Army announced that the award of the EMD contract would be delayed until January 2012 because the Army changed requirements for the JLTV. The change in this program, at a time when programs across DOD were being cut or eliminated, sent shockwaves through the industry. Another blow to industry confidence came with the establishment of the Joint Select Committee on Deficit Reduction as a provision of the Budget Control Act.
If the Select Committee legislative process fails to result in a law, that will trigger $1.2 Trillion across-the-board spending cuts in discretionary spending, Medicare, farm subsidies, and a few smaller entitlements. It is anticipated that DOD would take about half of these cuts. Recent speeches by the C, JCS, the CSA and other DOD senior leadership have been to remind Congress of the history of drastically reducing defense at the end of conflicts. I heard this theme echoed from industry across the board. Nobody was sweating, but nobody was particularly ebullient.
Even the Army Energy panel echoed these topics. Capo di tutti Capo for Army energy Katherine Hammack assembled an impressive collection of uniformed leadership. Her battle buddy, LTG Rick Lynch was not in attendance, but Installation Management Command was ably represented by Deputy CG, MG Al Aycock. For the first time, the Army Staff and Operational Units were represented by the soon to be G4, MG(P) Ray Mason and current 1st Armored Division Commanding General, MG Dana Pittard. In another first, the Acquisition Community was well represented by the exceedingly handsome MG Nick Justice, Commanding General of the Army Research, Development and Engineering Command (pictured above). Each speaker focused on their roles in providing for the three elements of energy concern: Basing, Soldiers and Vehicles. I took copious notes, only to find that they had already posted ALL the slides. They are here for your perusal. Worth taking the time to read.
In general, what we heard was that the Army would invest in energy efforts that had immediate, tactical impacts, but when it came to large, scale renewable energy what the Army wants to hear is, “I got the money, honey, if you got the……land”. The theme of third party finance resonated through every discussion of installation energy security. In another cost savings measure, the Army Energy Initiatives Office Task Force became the Army Energy Initiatives Task Force and announced an Army Energy Initiatives Task Force Summit for four hours on 3 November 2011. Registration is open until 21 October 2011, but when I attempted to register, the website informed me that they were at capacity and that I would be placed on a waiting list. I would have supposed that if I were hoping to do outreach, I would have it in a facility that could accommodate the potential crowd. Perhaps a web link so we can participate? We have the demand; are they out of land? Dan Nolan
Thursday, October 13, 2011
The agenda includes:
- Remarks by Secretary of the Navy: New Energy Future
- Remarks by Chief of Naval Operations
- Affecting Culture Change: How to Create Spartan Energy Warriors
- Retooling Our Fleet: Successes and Challenges
- Combat Enablers: It’s About the Warfighter
- Strategic Outlook
- C5I (Command, Control, Communications, Computers, Collaboration, and Intelligence) Considerations
- Energy Efficient Acquisition
- Game Changing Solutions
Thursday, October 6, 2011
This project, in two phases, is estimated to cost $5.2M with a small business goal of 50% of the overall project cost and a period of performance of eighteen months. Although this seems like a lot of work for a big firm with only $2.6M in the return, this will be about getting there “firstest with the mostest”. The company that wins this will have a leg up on what is expected to be a $5B market.
DOD has some specified tasks it must accomplish. We have listed them before: buy biofuels, reduce energy consumption, and consume more renewable energy. In the case of installation energy, there are a number of implied tasks:
- Develop systems that will provide the military effective countermeasures to asymmetric vulnerabilities associated with fragile grid conditions and escalating costs while building in mission assurance and energy security for installations
- Provide improved solutions to energy security and clean energy requirements, enable opportunity pricing and offer cooperative environments where utilities may better service military installation needs.
- Communications and controls that allow synchronization and load optimization
In addition to the R&D effort associated with this JCTD, there are folks putting smart grids on the ground today, and in some pretty tough environments. Project Manager-Mobile Electric Power (PM-MEP) is running the Afghan Microgrid Project or AMP in Camp Sabalu-Harrison. They are receiving forward engineering support from the Research, Development and Engineering Command's Field Assistance in Science and Technology – Center, part of the 401st Army Field Support Brigade.
The team put in a one-megawatt microgrid that can replace up to 20 60-kilowatt TQGs. These Tactical Quiet Generators had been producing more than 1,300 kilowatts of power to meet a demand of less than 400 kilowatts. The situation is not atypical of spot generation in theater and, if this works, could serve as a blueprint for future operations.
Even as these R&D efforts move forward there are efforts to just be smarter in how the Services deploy energy. When units first hit the ground, every facility has its own generator. Over time, the simple process of position improvement dictates that this inefficient method be replace with some sort of mini grid. This is now being done in a significant enough effort to warrant the scrutiny of the NYT. In an article last week, Annie Snider highlighted the efforts of COL Tim Hill and the Army’s operational energy program. The system is basically just “ganging” generators together for greater efficiency, but that is a start.
At last week’s 2011 Washington Energy Summit, Dr. Dorothy Robyn, the Deputy Undersecretary of Defense for Installations and Environment said, “(The) microgrid is a triple play. It's a set of self-generated electricity and controls that allow us to operate more efficiently ... in a normal mode but [also to] facilitate the incorporation of solar, wind (and) other forms of renewable energy. And most important, if the grid goes down it will allow us to prioritize and continue to operate activities that are most critical".
It looks like the lessons from the frontline are making it back to the home front. The AMP does not appear to have integrated renewables or storage as part of its construct. Putting those into the mix would seem to be the next logical step in demonstrating the importance of the smart microgrid. From dumb, ganged minigrids to smart microgrids that provide true energy security requires government investment. Third party financing for these efforts will be challenging; tough to make the business case. The technology is mature and the results are a saving in dollars and lives in convoys and ensuring mission accomplishment at installations. Without intelligent power management, renewables are just tinkering at the margins of energy security. Dan Nolan
Monday, October 3, 2011
Everyone talks about the weather, but NDU is doing something about it. Not terrestrial weather, but storms in space. Dr. Rich Andres brought this to my attention. This Wednesday, 5 October, the Energy & Environmental Security Policy Program and the Center for Technology and National Security Policy at National Defense University (NDU), in conjunction with US Congressional EMP Caucus, and InfraGard National Members Alliance (INMA) will gather to discuss recent war games on the impact of space weather on the electric grid.
As if we didn’t have enough to worry about, these good folks will talk about “how to better prepare for widespread and long term power outages as outlined in a number of studies from the National Academies of Science, the US Congressional EMP Commission, the Federal Regulatory Energy Commission (FERC), and the North American Electric Reliability Corporation (NERC)”. We know what happens when a tree limb falls in Ohio or STUXNET gets into the firmware. Now we have to worry about what happens when the solar wind blows. As a former nuclear targeteer, I have studied the effects of massive electromagnetic pulses on electronics. We don’t get thrown back to the 19th Century….more like the 16th. That those effects could be created by solar activity is indeed frightening.
Registration is required so go here to sign up. If anyone attends, please send in a report. Dan Nolan