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Secretary Rick Perry and the Psychology of the Energy Revolution

July 6, 2017

 

 

“That binary choice between pro-economy and pro-environment that has been perpetuated… has set up a false argument. The fact is we can do good for both.” --- Secretary Rick Perry

 

 

That was the sound bite that stood out at Secretary Perry’s White House press conference last week. He hit on a topic that sits at the nexus of business, politics, media, and, surprisingly, basic psychology. For the most part, his observation is correct: we do have the option to solve many issues at once, if the industry can further adjust how American consumers approach the energy market.

 

In the United States over the past 10+ years, we’ve experienced a trifecta of developments that have now led to a major shift in how we power our country; improved cost efficiency of renewables and energy storage, expanding capabilities and capacity of cloud based energy controls software, and a relatively stable low-cost supply of natural gas. This has enabled individuals, companies, governments, and utilities to envision a grid that is not purely a centralized model, but one that is increasingly distributed, highly specific to the needs of the consumer and more tailored to the realities of their locality. As highlighted in David Crane’s Energy Manifesto, “Now we are headed for the same goal, but in the opposite direction: down the path toward a distributed-generation-centric clean energy future featuring individual choice and the empowerment of the American energy consumer.”

 

The energy consumer has exponentially more options for how they source energy than they did a generation ago, but the way it is discussed in national politics has largely remained the same. Primarily various parties advocating for shifts in the large, monolithic energy grid. The problem with addressing energy from a political approach is that there is a latent consequence. The discussion perpetuates the idea that there has to be binary “sides” to the argument. That one has to put all their weight into a single opinion in order to make incremental changes to our highly centralized and complex energy system. This lends itself to a hardening of confirmation bias and heuristics, which is a term psychologists coined to define the mental shorts-cuts we use to simplify our world.

 

The issue with these mental short-cuts is that the average consumer becomes encapsulated with the loudest voice that confirms their bias (i.e. confirmation bias). What is lost in that discussion is the increasing amount of granular choice consumers do in fact have. There is less need for promoting a single approach to the macro grid, when on-site and distributed energy systems are becoming cheaper, cleaner, and more reliable. These systems can be customized to the consumers’ needs. The design can be tailored to the financial and performance objectives of the consumer. The way the system is paid for and financed can be aligned with the consumers’ necessities. The operations of the system can maximize the benefits to the consumer and adapt to changing conditions in the future. This results in cost savings and control, increased reliability and resiliency, and reduced emissions.

 

The key to unlocking this potential wave of consumerism is to change the thinking and discussion about the consumers’ options. There is no need for mental short cuts in this conversation. The consumers that avoid these psychological tendencies, and approach this issue with a pragmatic focus, will have the ability to decide what is in their best interest and use their purchasing power and creativity to speak louder than the typical trite political narratives.

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