 Okay. Good afternoon. Thanks, everybody, for being patient. Sorry, it took us a little bit to get set up today. Hi. My name is Sarah Ladislaw. I'm the Director of the Energy and National Security Program here at CSIS. I want to welcome all of you here today for our discussion on sustainable, resilient energy infrastructure. We're going to focus on the role of SRI in managing growing urban settings. As you'll see from some of our panelists, we've got sort of different definitions of what a city is. So we'll be talking about this issue across a range of built infrastructures. We're really excited to have today's session. It's the second in a series on global sustainability issues that we are pleased to be sponsoring here with the support of Bechtel, who has made it possible for us to look at sustainability across a range of regional and topical slash functional areas that we'll be looking at throughout the course of the year. So thanks very much. We're really excited about today's session. It's been something that's been on our minds for a while. For those of you who come to some of our events often, you'll notice some of these folks have been at other workshops or panels that we've had, because really we've started to see this focus on the choice between sustainability, both in the built infrastructure and technologies, and also sort of resilience, both to, as we were just talking about at lunch, either cyber attacks or natural disasters or incidents, as being a really important part of a discussion that we need to have both about planning and investment policies and regulation. And so we actually think this is a really timely topic and know a lot of you spent some of your time focusing on this, so we're looking forward to a good and interesting discussion. We're starting a bit late, so I won't go on too much longer. We're really pleased today, and I'll just give it to you in the order that they're going to be appearing. Today we've got Peter Evans here, who's the president for the Center for Global Enterprise, came to us. We've known Peter for a long time through his work with GE, and really was one of the first people that I'd had sort of a formative conversation with about sustainable resilient infrastructure. So really welcome him here to sort of talk about what that concept is and how we could start thinking about it. We've got Jan Vrens here, who's the managing director at Navigant, and Jan is wonderful at sort of explaining the changes that are going on in the technology space, especially on the electric power side, and how that fits into both how we're thinking about how sustainable technologies and resilience fit in the market structure that is evolving because of these new technologies and information systems. And then we've got Amos Avedon, who is the senior vice president and manager of engineering and technology with Bechtel. When we first started this conversation with Bechtel, you know, we wanted them to be on the panel because we know about some of the experience they've had, both in terms of thinking about the technologies that you can bring to bear for managing these two challenges, but also some of the planning that's required. And so I think that that sort of unique perspective, both on the capacity building and planning side and on technology, is a really unique perspective that they're bringing to the table today. And finally, David Rogers, who's the senior climate change specialist for climate and chemicals with the global environmental facility, also known as Jeff, David was with us at a previous rollout of Climate Scope, which was a report that was done with the collaboration of a number of development banks in Bloomberg New Energy Finance, and he really sort of talked about, you know, the challenge of getting developing countries to have the resources and to sort of finance that gap between energy infrastructure that they're considering and energy infrastructure that takes into consideration climate risks. And so he'll talk a little bit about the experience that Jeff has had in trying to seed some of that financing and build momentum. So without further ado, I'm going to turn it over to Peter, and each speaker will have a bit of a presentation, and then we'll have a discussion. So thanks again for being with us. Oh, I'm sorry, if I don't do this and we have a disaster at a resilience conference, I'll be in big trouble. So we don't plan on having any incident today. But if we do, the evacuation route is pretty simple. It's to the back of the room and out to the front of the building. You can also, I believe, get out this door, no, that door. Sorry, don't listen to me. That door, that'll leave you in the alleyway in the back of the building and you can get over to M Street. So, but I would recommend if it's not blocked, the one that, you know, you can see through the glass to get to the entrance. But that's our safety moment. So, Peter, we do, we use the hook and hook up there. Thanks very much. It's great to be here. Great crowd, great day, great panel. So what I thought I'd do today is frame this issue up. I've spent a fair amount of time reading through the literature and actually had a chance to travel around both to Europe and Asia and talk to a number of officials about this topic. So what I'd like to do is be more of a framing. We have a lot of expertise on the panel that can go into each of these items deeper. So my first slide is to prove that resilience is a big deal. There's a lot of reports out there on this topic. These are, I think, largely government related. The National Academies of Sciences, for example, in the U.S. has done studies. The World Bank has gotten into this topic. Some foundations like the Rockefeller Foundation have been doing a lot of interesting work in this area. So it is a very rich and diverse literature. And it comes from a variety of different angles. So you'll find the civil engineers have gotten very interested in it and they have their world view. The climate folks have spent a lot of time on this, or at least have gravitated to this topic. And so they have their literature. You have energy people. You have water people. And so it's a very diverse, and if anybody's interested in getting the short version, and you can please feel free to come and speak to me about it. And I've got a fairly sizable database now on the resilience literature. So there's a lot of attention to this topic. It's become a bit of a buzzword, but I think it does speak to a growing reality and that is the impact of shock events. And we can have a variety of types of shocks. You can have political shocks. You can have financial shocks. And then you can have these physical shocks to the system. So resilience really rises out of these physical shocks. So I think a first question, and I have a series of questions here that I'll pose to frame the discussion for today, is resilience to what? And as I mentioned, the climate folks are focused on climate related, but one of the biggest impacts to energy infrastructure is actually earthquakes. They do a huge amount of damage to systems. In Chile, in New Zealand, there was a big earthquake. And obviously the biggest, and this is what really got me into this topic, was the earthquake and tsunami that hit Japan a number of years ago. We know about it largely through the nuclear fallout from that, but it also knocked out a huge amount of fossil fuel generation that was critical to Japan's energy system. So there's a bunch of different types of disruptions that happen. Volcanoes actually can be impactful. Flooding is very, very damaging to the energy systems as we saw in Hurricane Sandy. It was that storm surge that impacted the distribution system and flooded quite a number of the substations. And then you have the storms and then other extreme. Another one that is not as dramatic in its immediate implications, but can have huge implications to energy systems or droughts. We've seen drought events in Brazil have very, very big impacts in California now as well. And wildfires can actually have, so there's a whole range, and depending on who's speaking on the topic or writing on the topic, they'll tend to focus on one or another. And then today at lunch, we also, so it was Charlie, raised the issue of human interventions, right? So you can have terrorist attacks or you can have cyber related effects that also create shock events to the system. So they're all different. And then you also have another question, which is who is vulnerable? And there's a lot of interesting emerging research in this area. This is a slide that basically takes the United Nations analysis of city related effects of hazards. And what's happening, you know, the mega trend is a concentration of more and more people in urban centers, which is great for culture and economic activity and the vibrancy, but it also concentrates risk. And so this map shows whether or not a city has one hazard, two or more hazards or three or more. And you can see that Asia Pacific has a high degree of vulnerability, but lots of other places around the world do as well. And if you've looked at any of the demographic trends, you'll just see the growth of cities being phenomenal and associated with that. Obviously, if you have a lot of people living in a city, that means you have a lot of energy infrastructure sustaining those populations. So cities are one way to look at this problem that's getting a lot of attention, but you can also look at regional or very local. So kind of the levels of analysis are important. The other is to understand the scope of this. And there's insurance agency, Munich Re, who puts this analysis together every year. And it's pretty dramatic, which is to look at the scope of natural disasters on a global basis. We usually in the news hear about individual events and it's kind of episodic and you hear about it and there's recovery and then you go on. But when you look at the scale of it on a global level, we see that we're now trending over 900 major events a year. And it's all over the map and it's very diverse in the kinds of disasters that happen. Some of them are drought events, some of them are earthquakes, some of them are storm related. So it's not just climate. It's also these other types of disruptions that can happen. And the trend line isn't looking so good. Back in 1980, you had about 400 of these events a year and now we're trending over 850. And that's largely due to the fact that the human built environment has just gotten bigger over the last 30 years. And so there's just a lot more stuff to be hit by these types of shock events. And so it's just part of living on earth that we live in an earth that has these perturbations. And so the environment that we build to live in gets hit by these types of events. And so we're seeing this happen and increase. And I think based on what I've seen, there's not more earthquakes happening. It's just that there's more stuff out there for those earthquakes or those storms to be impacted. And so this leads to an interesting set of questions about what is the policy imperative for today and going forward around energy. And we've seen over the last two decades a tremendous focus on sustainability, right? How do we get our energy system greener? But as these impact, these shock events become bigger. And particularly when they do things like hit New York City, which is both a center for economic activity, but it's also symbolic, right? That a lot of people look to New York as the city in the world. I mean, it has very important symbolic strength as well. And so when you have a major event in that kind of city, people begin to look and realize we need to think more about how do we protect ourselves against these shock events? And so you get an interesting question from a policy perspective of, do we focus on reducing carbon emissions and other things to make our energy system cleaner? Or do we make it more robust? And it turns out that there's some interesting questions about whether or not these are two goals that are synergistic or are they divergent? And so investment that you make in robustness does it take away from the sustainability or not? And there's a debate about this. But what's pretty clear is that the policy pendulum is beginning to shift to thinking more about the robustness equation. And so the question is, can we move into the upper right-hand corner which would be resilient, sustainable? I.e., can you combine these things together in a cohesive policy forum? So this leads to the question of what is resilience? And I just put up one definition. There's a lot of definitions out there. And that is this ability to bounce back faster from a stressor shock, endure one, or minimize the impact of the stressor shock. And there's a whole range of interesting diverse solutions that are proposed around diversification, greater intelligence, i.e., how do we use big data and analytics to improve the resilience of systems. This relationship between coupling and decoupling, i.e., we have these big centralized systems, how do you get away from them and decouple from them when you have a disaster, and then recouple because large centralized systems tend to be more efficient and you get a lot of benefits from being connected, but when those systems go down, how do you decouple? Pooling and coordination of resources, how do you bring in others that can help you during a disaster and how do you set those things up beforehand? And so there's a lot of interesting things, utilities from basically all the way into the Midwest help support conhead in the recovery. So how do you set those things up in advance and think about them? And then what kinds of levels of redundancy are hardening that you wanna put into the system? So there's a lot of diverse solutions and I think it's very early stages as to where will policy focus in kinds of sets of solutions that are thought about. Another is the problem of network linkages. I think that we hear a lot about decentralization of the energy system, but another big trend is the linkages between systems. And what's happening with the advent of shale in the US is two systems that had almost nothing to do with each other and now increasingly coming together and that is the gas network with the transportation network. The transportation network is looking to get the advantages of lower gas and so these two systems are coming together. What does that mean in terms of the interconnectivity of those? Hurricane Sandy revealed that when you lose electric power you also can impact your transportation system because gas stations require electricity to pump the fuel up and so you had a transportation crisis coupled with the electricity crisis and so are we setting ourselves up by linking natural gas with the transportation network if something happened to the natural gas system does that impact the transportation system? And I can go on with other linkages here but the point is that as these complex networks intersect how do they cascade through the system when a shock events happens and how do you protect against that? Timing is a really interesting and challenging and problematic question which is where do you invest in resilience along a continuum and that is you have the mitigation of risk that is before the event happens and you have the disaster itself and all of the chaos and all the challenges that are associated with figuring out what got damaged how do we manage that system and then we have the recovery portion so we have before, during and after and resilience I think and if you read the literature talks about different parts of this and you have advocates saying we should do more of the front end we should do more on the back end so thinking through where do you invest in resilience I think is a really important issue and then on the back end what do you recover to? People say well we should build a new system that will lead us in a better place in the future but the brutal reality is is when you have these shock events people want their systems up back and running right away and so what happens is you tend to rebuild what you already had and that's what happened again in Hurricane Sandy is you typically rebuilt the existing system not the system that people realize would be more resilient or efficient or more sustainable in the future. Another question is who pays and there's been some really interesting work and I think the PhD students that worked on it are here today which is following the money i.e. this is an example of a earthquake that happened in San Francisco in 1989 and it's very interesting to see the patterns of financial flows that is which local agencies, what state agencies, what federal agencies provided funding which charities contributed to that and you see these complex networks of financial flows emerge and this is of course in the United States which tends to have more resources these patterns are much harder to build and so in the emerging markets where those institutions are weaker and so thinking about who pays and how and when is a really important set of questions and just in the energy space is it the taxpayer is it the rate payer or somebody else in the system is very critical. And then finally I think a really important question is are we doing enough to spur innovation in resilience? So if you look at various countries and the kinds of programs they put in place to foster innovation you find the tremendous amount of attention to coming up with the new latest green technologies but not a lot on the resilience side and so a question is is public funding for innovation going to the right places and will we see a shift and if we do where should that investment go and is there a synergy of achieving both resilience and sustainability at the same time. So to wrap up just to summarize again I think going forward this interconnection between resilience and sustainability is what we face in the future for our energy system. Some of the key challenges are timing to incentivize the right allocation of resilience between before, during and after the shock. Funding that is figuring out who pays for resilience because it has a lot of the attributes of a public good which means that the private sector tends to under invest in resilience and then finally are we doing enough to spur innovation in this space and if so what kind of innovation would make sense. Thanks. Okay well we get Jan's slides up. I think those are great framing questions timing, funding, innovation certainly add to the list you know planning right whose responsibility is it to plan and think about some of these things. So those are questions I think that the rest of our speakers will also address. So I just want to welcome Jan Vrens from Navigant to talk a little bit about how we're really dealing with these issues of sustainability and resilience on the car while it's running right. The electric power sector is something that shifting pretty dramatically we focused on it in other sessions here. So take it away Jan. Thanks Sarah. Also excited to be here talking about this topic. I think Peter covered a lot of ground. I will talk about two macro technology trends that we see around energy infrastructure. Technology never stands by itself. Regulation, people, processes, organization, business models, market structures are part of it but we see two big technology trends happening now in the energy infrastructure space that can become game changes. To start, and Peter spoke about that, global urbanization, these are some numbers in terms of what's gonna happen over the next 35 years where currently 50% of the world population lives in cities that will increase to 70%. It will rise up to 6.3 billion people living in cities in 2050 using 70% of the world's energy use only occupying 2% of the world's space. So these are some interesting numbers from an overall global urbanization perspective. We classify the century as the urban century. There will be more people moving two cities in the first half of this century more than we had so far combined in human history. So that's quite interesting. And this raises questions around sustainability, resilience, also affordability and cost and how do you manage energy infrastructure underneath. One of the concepts, I'll talk about two concepts, smart city and energy cloud. And I will explain energy cloud in a bit. Smart city, I think everybody has heard about the concept of smart cities. We do believe that, and this is the definition of smart cities, it's enabled by technology but it clearly focuses on sustainability, citizen wellbeing and economic development. As Peter said, resilience is not part of the definition yet so that's quite interesting and the question is should it be added? But this is more or less of a common definition right now. All the smart city projects globally hit on those three elements. We see very recently as of last year discussions about sustainability and can that be part of the definition of smart cities and what that means. But again, smart cities aimed at providing more convenience to the people living in the city, reducing greenhouse gas emissions, building a cleaner energy infrastructure. Energy efficiency is a big component of that. We strongly believe that energy efficiency is underutilized. I think it will change rapidly over the next couple of years at the global level, not only in North America but specifically in Europe and then obviously the Far East as well. And housing, street lighting is part of that. This is energy resources, energy management systems for buildings are part of the smart city concept as well as transportation obviously, electric vehicles or otherwise. And economic development is always part of these discussions because that's the big motor behind investments and what governments as well as private organizations are trying to accomplish as part of smart city initiatives. So this is smart cities. The energy cloud is a concept that we developed where we see right now a big transformation happening in the industry from a one-way power system where you had centralized power generation, mostly nuclear fossil fuels, some hydro here and there, transmission, distribution into your house, you get your monthly bill, you pay the bill, if you don't pay the bill, the utility would cut you off. That was pretty much the system that we had built so far in the last 100 years or so. To what we call the energy cloud, which is really evolving rapidly right now, big players in the industry are embracing this concept. We see a lot more distributed energy resources, wind, solar, and whether it's utility scale solar or rooftop solar on top of your house, community solar facilities on campuses of universities and medical facilities, electric vehicles, charging stations, using car batteries to discharge at certain moments in time back into the grid. Concepts of I have rooftop solar, I generate power, I generate more power than I use, I sell it back to the grid, to a community storage facility and my neighbor who does not have rooftop solar buys power from that utility storage facility, sorry, from that storage facility in the neighborhood. Two-way power flows, consumers of power become producers of power, so consumers, very complicated financial transactional relationships will appear, complex regulation, but it's happening as we speak. If you look at renewable penetration in California, there are days now in the California ISO territory where at three o'clock in the afternoon, there's less demand for power than two o'clock in the morning. So the traditional demand curves that we see on the left side of this picture will drastically change on the right side picture because of rooftop solar, because of wind and other renewables and distributed energy resources. Storage will be a game changer once we add storage to solar and wind, we don't depend on the sun or when the wind blows anymore, we can store it and we can use it whenever we need it. I was reading an article on my flight in about a new battery technology, alumni-based, where a cell phone can be charged within one minute and it can recharge more often than the traditional even lithium battery technology. So technology will come, it's not a matter of if it's a matter of when and when they reach grid parity and when they reach the point where they become economically viable. I was in Dubai three weeks ago, four weeks ago. DUI just bought a utility-skilled solar facility at six cents per kilowatt hour. Those are groundbreaking rates for solar. It will continue to go down and it's coming from Hawaii, California, Arizona, it's up in Jersey now, it's coming to Arizona, sorry, to Georgia, Carolinas and Georgia and ultimately in Florida where I live, which is the Sunshine State, but not very favorable for solar. But we're doing a study right now for the utility in Florida looking at distributed solar integration into the grid. What this means for the grid is quite significant. The grid will undergo significant changes to manage all those intermittent resources, to understand demand of power, meet it up with supply across the entire value chain. What this also does is there's multiple new players developing, building, or maintaining and operating these distributed resources. And it will be very complex to manage, because ultimately you wanna manage demand and supply, but with clearly the demand side of the equation changing rapidly, users generate their own power, don't rely on power from the grid anymore, at least not when the sun shines, when the sun goes down all of a sudden I need to rely back on the grid. And then with all those intermittent resources it will be a very complex entity to manage. And we're doing a lot of studies now and thinking about how that will work, because again the traditional rules won't apply in this energy cloud concept. By the way energy cloud comes from cloud computing and this whole movement there, which is quite interesting, plug and play, anybody can produce his own power and plug it into the grid basically. In terms of some of the technologies underlying the energy cloud, here are some. I spoke about storage, I spoke about distributed generation. So I think I covered that. The right side of this slide, we talked about the configuration of the grid. We're gonna need to have systems and applications in place to manage all these distributed energy resources, these intermittent resources. And then there's other technologies that support that. Smart inverters, smart meters, smart routers, advanced skater, demand response and building energy management systems. So there will be a lot of technologies layered on top of the grid that actually manage demand and supply across the grid. And that's where a lot of the investment goes to right now that the large investor in utilities are doing. Either they're investing in hardening the grid, so just moving the substation to higher altitude is our investments that are being made or putting some of the distribution cables underground to make it more resilient. Things that are, that PSNG is doing right now up in Jersey. And the others are around making the grid smarter to manage demand and supply more efficiently and to manage all the distributed energy resources that are appearing. In terms of, oops. In terms of the combination of energy, clouds, smart cities and then resiliency. Peter spoke about that, you know, more people are moving towards large cities. There's 360 million people that are currently living in coastal areas that are just above 10 meter of sea level. Very vulnerable, and this is just one element. New York City, the population of New York City that is now in a flood zone doubled in the last, you know, 30 years or so. Cost of hurricane Sandy, don't need to talk about that much. I think Peter covered that. And then the energy cloud, is that a good or a bad thing from a resiliency perspective? And there's some pros and cons here. Energy cloud has built-in redundancy. I have my rooftop solar facility. If that doesn't work, I go back to, you know, the grid, microgrids will provide more resiliency to the grid. The fact that the grid will become smarter, it gives higher visibility and control over demand and supply. So, you know, you can actually manage it more actively. You can see where the outages are very quickly and you can restore outages much quicker. PSNG is looking at technologies where they actually use their customers to take pictures of damaged infrastructure. Those pictures, you know, are being sent through their mobile application into their SCADA system. It looks at the configuration of the pole and the crew is being sent out one time to fix the damage. While in the past, crew had to come back two, three times because they need to look at what the damage is. They need to find the right inventory for it, send out the crew to repair it, et cetera, et cetera. So, it will help in terms of, you know, restoring quicker and improving overall resiliency. And then customer choice and reduction of dependency where I don't wanna rely on my utility for my power. I'm gonna generate my own power is something that is also on the left side of the pros. Cons are complexity, increase points of failure, which is a big issue. How do you manage all those distributed energy resources to Peter's point, you know, central is easier, looks easier. And I think the next speaker will talk about that a little bit more. Security, definitely an issue. The grid will become digitized and will be open for security threats. So that's an issue that is being looked at and debated broadly. And then the complexity overall of managing demand and supplies is not easy, specifically not in a deregulated market. So it will be very interesting to see in deregulated markets like California or New York or Texas where distribution and resources are really taking off, where the number of entities involved in producing transmitting and distributing power is significant higher than in my state, Florida, where I just have FPL, which is an integrated, you know, utility, they do it all. And what that does in terms of their ability to manage the grid effectively. Energy cloud might lead to re-regulation in some areas, which is quite an interesting statement and we can talk about that. Let's see, my last comment on this slide would be power doesn't stand by itself, power ties into water, Peter spoke about that, but then also public safety, you know, street lighting, transportation, electric vehicles, emergency service integration and all other. So that's back to the smart city. You kind of look at power by itself, but power is part of a broader infrastructure and you need to look at all elements of that if you wanna be successful in either building or rebuilding. Closing energy clouds here to stay, it's not gonna go anywhere, and smart cities will evolve and adapt. Most of the smart city projects right now are in the pilot phase, but they are evolving in broader implementations around energy efficiency, demand side management, transportation, smart meters, smarter equipment on the grid as well. Resiliency will, resilience of the infrastructure as well as convenience to the citizen, I think the customer choice element will become more predominant and more important as part of the discussions around smart cities and the energy cloud. Online infrastructure is changing really quickly, whether it's replacement or new build and key technologies will continue to evolve. Again, storage will be a game changer, provides resiliency and will help sustainability as well because it supports solar and wind. At the macro level, the objectives can contradict. I think at the micro level, we'll find solutions to make it all work. And then what is needed, and Peter spoke about that, is that public, private entities, government, non-government utilities play a key role in this. We'll have to come together, figure out a strategy and implementation for a city, for a state or for a country, and do some sort of a long-term, we call it integrated resource planning, but also a plan to build your infrastructure underneath cities and states and countries based on energy waste, transportation, building infrastructure. Thank you. Thank you very much, John, that was great. So next, I'd like to invite Amos Avedon to come up, senior vice president from Bechtel to talk from a practitioner's perspective about doing big infrastructure projects with both sustainability and resilience in mind at the planning phase and thinking about technologies that are brought to bear. Thank you. I'd like to thank CSIS for bringing this panel together. I appreciate being here, and thank you for the audience for coming here and those who are joining us on the webcast. I hope you find it interesting. I think one of the main reasons to talk about this, I think, and both David and Jan and Peter mentioned this in our discussions before, is we need to increase awareness of the importance of the confluence of designing for a more sustainable future and for a more resilient future. We hear a lot about sustainability. We need to hear equally about resiliency. We believe at Bechtel that they're both synergistic. We also don't believe they necessarily have to cost you more. You just have to plan for them and put them into your planning, and I'll try to show you some of that in my talk. The other thing that's important is years ago when we talked about resiliency, we mostly talked about hardening of facilities. You have a power plant, you build a big wall around it, so if there is a flood or something, it can protect it, and that's still important. But increasingly, what I'd like to show you today, this is changing dramatically to some of the things you've heard from Peter and Johan about, we now live in an information age, and we look at systems. And just like reliability-centered maintenance, we're not trying to back up equipment or individual components. We want to make the whole system resilient, and that definition of resiliency is how fast can you bring it up to speed? And I'm just thinking about what an area to work in. If you really plan well for resiliency, your measure of success if is, well, a big event happens and nothing much happens. So many of us feel that's maybe not enough a reward. I don't think that's the reason we are not going in as much into it, but that is truly the measure of doing it well, is that nothing much happens. So we live in an information age, and that information age transform everything we all do in our lives. We all know it. It's real. Data is truly transforming everything we do. It's a new resource. It's changing the whole world very rapidly, and you've seen smart cities take advantage of all that. What I'd like to show you is this information age is also dramatically changing how we plan, design, and build big infrastructure projects, including energy infrastructure, and how that's helping those structures not only be more sustainable and more resilient, but also transfer all this information to our customers and through a whole life cycle of those projects. So let me see, there you are. So we truly live in an information age, and you've heard the phrases, the internet of things. That's very real. All this construction equipment we have out there today is highly automated. It can maintain itself. It knows what it's doing. It's know if it's operated in a safe manner. As a matter of fact, it can be operated remotely by people, or the next step, it can be operated by the three-dimensional model that designs the plant can actually operate equipment. So there's a dramatic revolution that we're in the middle of it. This revolution relies, of course, on satellites, GPS systems, drones increasingly, of course, connectivity in all ways. The three-dimensional models that you're all familiar with, I'm sure, the ability to plan in real time, and then increasingly, mobility. When we think of the construction workforce that we are seeing now, and what it's being changed into, these are people with highly sophisticated mobility tools. There's fewer of them, but they can do much more. And they have access to real information, not to paper drawings. The big difference here is we lived in a document age. We were designing in a 3D world but communicating in a 2D world. And we want to get rid of all of that. We want to move to a data-centric world. We call it virtual project delivery. And I'll show you a couple of examples of how this actually works. We are right at the edge of it. This is a true revolution. This is a bigger revolution in our world and in engineering and construction than the introduction of computer was compared to drafting tables and slide rules. I look at my audience and I know more than half of them have no clue what I've just said. But this is truly game-changing. And the opportunity here is to deliver much better project. What I mean by that is to plan for these projects to be sustainable, to be resilient, to be lower cost, faster schedule with less resources. And very important to the fact, when you look at all this infrastructure that my colleague talks about, we are talking about trillions of dollars. To be able to commit to those levels of investment, especially by private investors and by partnerships, you need predictability of these big capital projects every now and then you hear of capital projects that greatly exceed what was promised. And those tools can really help you with much better predictability. So, I guess you have to press it like you mean it. So here's an example of how we use, how we design a smart city. But this can apply to anything. This happens to be an example for basically redoing the whole planning for the infrastructure of a whole country, Gabon, and the city of Libreville that's being transformed into a smart city through this process. And what you can see through here is there's different layers of information. We start with GIS information. GIS is more just maps. It's very sophisticated maps that have a lot of information embedded in them about everything that is important to design of that element. Above that, you have a lot of information about what's already in the ground. We need to be obviously for safety and security reasons then for knowing the underground layouts. And there's more and more ways to get this information and transform it to real data. Above it, you have the whole grid of roads and public transport and communication systems that drive any kind of city, smart city, or one of the more old-fashioned ones that's being transformed to a smart city. And above that, of course, you have the interaction of people where they live, businesses, and how that city works. And then above it, you have everything else, like the infrastructure, the energy infrastructure. Energy, as my colleague said, drives everything in today's world and the communication channel. So this can be done from scratch. This is being done to improve existing systems. And this is really what's changing the whole work process. And this work process is illustrated there on the chart. It's for planning, for engineering, for the global supply chain, which today is truly a global supply chain, for construction, which, as I said, is more automated and using sophisticated information-driven tools down to starting up those facilities safely, transferring them to the owners. So the big difference here is instead of transferring a whole book of documents, and there's many books of those big projects, it's transferring the whole data that was gathered to build and design it as the operating data for the customer. That makes a huge difference for the safe and quick ability of those, the owners of energy facilities, to operate them quickly, safely, and reliably. And then, of course, it looks at the life cycle, and that's where sustainability comes in in a big way, and then it looks all the way through the commissioning of these facilities. What does it mean? And these, as I said, these systems are here today. They're being used, but we're just beginning to see the benefits of these systems, and there's a long way to come to really fully utilize and take advantage of these benefits. So let me show you a few examples. Just collected some pictures here of some of the projects we are working on. So on the left, nuclear energy. Nuclear power plants are there, their lives are being extended. Of course, this is the local issues in different countries. People look at nuclear energy differently. From one aspect, of course, it's a major part of the solution of the greenhouse gas reduction issue. It's, there's a lot of construction of new plants. There's also new technology being developed to lower the costs of nuclear energy. But the key with nuclear energy, of course, is that it has to be very reliable, very safe, and very resilient. And that is something that is going on. The lessons are being learned. If you look at these incidents like the Fukushima Daiichi, yes, there are issues of hardening infrastructure, as I said, against natural disasters. But there's also, how do you quickly recover? How do you provide immediately power so pumps can pump water out of it quickly? How do you make sure all that recover resilient infrastructure is in place? And that's something that people are looking at today. The other one, of course, the big story, as was just mentioned, shale gas, and the lower price of natural gas, and the fact that the resources of natural gas would last us more than this whole century, is really there in the middle picture on the top. You see one of the modern natural gas power plants that are being built everywhere, certainly in the US, they are a great match for renewable energy like solar and wind, they're a great synergy between them. And the costs of planning for these facilities to be resilient and sustainable has come down dramatically with this kind of approach that is described as virtual project delivery approach. So for example, when we build one of these combined cycle power plants, like the one we're just building not too far from here in Virginia, it's a copy of a template that was built before designed, has all the information in it, and the amount of engineering you need for a plant like that is less than 20% of what it would take to design a plant from scratch. That's a major impact, and that's why I have this belief that these technologies and all these don't have to add cost on the country, we should look at them all as opportunities to lower cost. There's also, we like many others believe in all of the above, resiliency is also diversity of supply, and so we are involved in hydropower, in solar power, we built one of the largest concentrating solar facilities in Ivan Podic shown in the diagram, and as mentioned, the cost of PV power is coming down dramatically to the point that it's truly competitive. It's a game changer. All of these plants, by the way, use exactly the same approach that I showed for Smart City for their design and operations and maintenance. And of course, I just would like to finish on this one with liquefied natural gas. Liquefied natural gas, again, is a major business worldwide, it's bringing natural gas everywhere, and these facilities have an outstanding record of resiliency, sustainability, and just people feel comfortable that they would run for decades as they are. And now, surprisingly, we all will believe that several years ago, but we are building some of the largest facilities of that kind in the United States. We're gonna become a major natural gas exporter. So the paradigms do shift, but the technology really is what's driving them just as it is for shale gas. Just one couple of quick examples here. Crossrail. Crossrail is a major rail dig across London. It's one of the biggest changes in London's infrastructure since the Victorian age where all the train stations were built in the periphery and there's limited connectivity east-west. So this is a dramatic change in all of London, and this was specifically designed for sustainability, for resiliency, for scenarios of what happens if sea levels rise, temperature rise, people's mobility patterns change. This was all taken into account. And in terms of sustainability, we are working on this with an integrated team with the owners, the transport for London. They wanted to lower greenhouse gas emissions throughout the life cycle of this project. And surprisingly, 15% of the greenhouse gas emissions from 120 years of operation are in the construction phase. So we may put a dramatic effort to lower those greenhouse gas emissions. For example, using diesel-hybrid construction equipment, much more efficient tunnel-boring machines, LED lights, so you need less of them and less cables, dimming lights automatically. All this information, the technology, the internet of things is allowing you to do all that. This is not cost-increasing. This is actually decreasing the cost and doing good for the planet. So this is very important to note on crossrail. And this is, again, happening in rail systems around the world. And it can also be used to retrofit all the rail systems to those kind of standards. And my last example is, again, going back to Gabon and the master plan for that country, because that, to me, is a great development model for the developing world. It's today, just like with cell phones, many countries that never had landlines moved to cell phone technology. There's an opportunity for the developing world to leapfrog a lot of this and design smart and resilient infrastructure. Thank you. Okay, thank you very much, Doctor. I've done that. That was wonderful. Last but not least, David Rogers, coming to talk about the work that Jeff's doing in this area. Thank you very much. And how much time do we have? Oh, we have 30 minutes. Okay, okay, very good. Thank you, everybody. It's good to see some friendly faces here. And thanks to Sarah and Peter for building this panel discussion and focusing on this very important topic. The Global Environment Facility, it's been around since 1991. It's the largest public funder for environmental projects in developing countries. Japan is our biggest donor, but US is our second biggest donor. And we're talking about urban, and so let me focus some of my talks on what we've done in the urban sector. We've been doing urban projects since 1999, more than 100 projects in 60 countries, investing more than 600 million. Now, it's true. Most of that investment focused on sustainability. And I think that gets to the feature that Peter is discussing, is how can we move beyond that and integrate resilience into sustainability. Here's a couple of examples, though, where we've been able to do some of both. So in Tianjin, an investment we did in China, they focused on using the land better, developing a transit-oriented land use planning system, and adopting a vegetation and water network to be more resilient. And this has ended up being a very effective test case for a city with 12 million people, but has been a role model for other Chinese cities that are going through rapid development. And again, some of the features here included an integrated urban plan that focused on regulatory and policy development, energy efficiency in public buildings, as has been mentioned, and public transport systems and non-motorized transport modes. Now, here's another example in a rapidly developing city in Cameroon. This is a city of two and a half million people, and their challenge was primarily adapting to weather-related events, including flooding. And so here, we helped promote community-based adaptation measures with larger-scale investments in flood risk management, water, and sanitation. And I think one of the aspects of this that gets to the points our speakers mentioned was that energy, and we can reduce energy consumption and waste water treatment, while also making that treatment system more resilient in case of floods. So these are a win-win if you have the right engineering and the right perspective going into that. So I made a short list, I think sort of repeating some of what my colleagues already said, but from our experience, we have seen a lot of work on sustainable cities, we've seen a lot of work on sustainable energy, and I'd like to see those come together in a future sustainable energy resilient city. So I think from our experience, we do want to reinforce that you have to rely on and reinforce and strengthen the natural systems that led to the founding of the city in the first place. And how can you take advantage of those rather than try to reverse engineer or geo-engineer them? And I'm thinking, for example, right now, in Los Angeles, there's a very nice development project to restore the LA River, which is gonna be nice for recreation and for green and for sustainability. Well, the original engineering on that was to protect against floods, flash floods. So what if 20, 40, 50 years ago, they could have had the foresight that we now know and could have built a resilient system from the beginning that promoted natural systems for that city. And they can get there again, but it's gonna be much more expensive now than it would have been before. And I think, as Peter mentioned, an energy resilient city is going to know where its water is and it's going to be able to manage water before a shock event, during and then after a shock event. And energy and water, I think, to this audience is probably no need to repeat, but in most folks' mind, very, very critically linked. And it would be a crime, really, to build a power plant now and not know where your water is going to come from for decades down the future. But unfortunately, unless the folks hire Bechtel, they might not think those things through, but they need to. So we absolutely have to know where the water is going to be during these shock events. Is it going to ruin all the nice energy-efficient equipment on the subbasement floor in your building or have you thought ahead and have you moved that to a higher floor in the building? My favorite topic for an energy resilient city echoes on one of my fellow speakers, is that you need to prioritize energy efficiency in buildings and equipment. You're going to not only lower peak demand, which allows you to deliver energy to the community through peak events, through shock events. You're, we're going to take advantage of better windows, advanced glazing to help moderate climate variations and protect against severe weather. And that's got to be done through either your insurance company is going to make you buy that, or it's going to be building codes and politicians are going to make you buy it. But someone needs to make sure that those type of advanced windows are in all buildings going forward. I do think, as our speakers mentioned that a resilient city has diverse sources of energy supply and hopefully storage and that when they can build out a distributed or self-reliant installations that can become a backbone in a shock event like the hospitals that had their backup generators running became a resilient safe place for first responders in Hurricane Sandy. But you can plan ahead on that so that you have a network of resilient self-reliant installations that in good times are connected to the cost-effective grid and in the bad times can become islands of reliance and resiliency. And I think as most of our speakers already mentioned resiliency is going to build information and communication technology system that allows data collection, dynamic controls allows decision makers to be able to improve operations on a regular basis and then respond appropriately when there are events. And I do think in our examples, many of the sustainable cities that we like to fund are also thinking about transportation alternatives that give added resiliency in the case of a shock event. So public transport, human-based transportation options, multiple avenues and good urban planning are gonna give you resiliency in your transportation system. Now I have just a couple of things that I wanted to let you know as sort of an advertisement. If you are working with developing country partners or would like to, the Jeff has about $200 million to invest in low-emission urban systems in the next three years. And this can be oriented on transit, energy efficiency, distributed energy systems, municipal waste systems. And we have another approach which is our sustainable cities integrated approach pilot which is asking cities to take a very long range plan to their sustainable cities design and look beyond just climate and not just water, not just chemicals, not just waste, but to try to look at things in an integrated fashion across the board. So in our sustainable cities, and this competition has been open now for about six months, each of the participating cities that's being selected is going to develop a sustainability plan and have a common set of tools that are informed by Rockefeller Foundation, World Resources Institute, ICLEI, R20, C40, et cetera, because this will be a very collaborative approach. I'm going fast to leave time for questions, I apologize, slow me down. But we have tentatively selected 11 cities, countries, I'm sorry, with multiple cities that will be a part of the program ranging across the world. And these cities have offered to put in their own resources. You can see some of the numbers there, for example, in Mexico, they'll be finding 110 million of resources to match with 15 million of Jeff funding. And we expect many of these programs to over the next five years to develop very proactive investments in sustainable sitting planning. And the opportunity to engage with them on resiliency is very high. We do also see that this integrated approach pilot should help establish sustainable urban management as a leading effort in the next several years. It's a very crowded space. The Jeff is not trying to reinvent the wheel but trying to facilitate people coming together in this effort. Now, my colleague, Xiaomei Tan couldn't be with us today, but I know she's very interested in talking to you about our sustainable city's effort. So let me just conclude with several thoughts. Okay. Number one, we need to move beyond little pilot demonstrations. I think clearly we have the technologies now, we have the experience, and so for a sustainable energy, resilient city of the future, we need proposals that can get to scale, that can look at the entire city and protect the entire population. And I encourage folks to think about not a little demo here or a little pilot here, but a large scale transformative investment. And I think what Peter mentioned about the timing of investments is so critical. And I think it calls on us, those of us who are involved in the international financial institutions, the world banks and the Asian development banks and others to rethink the way we deliver investment. Because right now, they can only deliver investment either five years ahead of an event or in a crisis, but we do not have the ability to help invest at all the times after a shock event to encourage resiliency. I do think Peter's point about trade offs is very important to understand, but I like the way that Amos reframed it is that in many cases, a low cost resilient sustainable decision is actually a low cost solution if you can get away from legacy thinking about the way things have been done in the past. And I think as well, if there's one challenge I would make to the panel and to those in the audience is that the intellectual understanding of resiliency is a critical step and I think we've reached that. But the political understanding of the benefits of resiliency is another critical step, which politician is going to get rewarded because they proactively thought ahead and invested in resiliency and then created the non-event that Amos was talking about, right? And I think unless we figure that out, we're going to struggle and it may be that businesses will be in the lead because they will use bottom line reasoning to make these proactive investments. But if unless we can also educate politicians to support these type of investments, we will be short changing ourselves. So with that, thank you very much. Okay, well, we've got about 15 minutes left for discussion, but I just thought I'd make everybody aware in a funny, not ha ha funny, but eerie funny kind of way. There's a big power outage throughout DC right now. So we picked a good day for our resilience conversation to be had. So I don't think it's anything terribly serious, but there's a lot of places, including I guess the White House State Department don't have power right now. So we're lucky. We planned it this way. We're resilient here. And in approximately 30 seconds the lights are going to turn off. Yeah. Listen, I want to open up the, since we have limited amount of time, I'd like to open it up to the audience for questions. If you're not forthcoming, I have lots of them. So please raise your hand, state your name and affiliation and put your question in the form of question, wait for the microphone because we're webcasting. So we'll start right here in the aisle. Mariah, go ahead. And maybe what I'll do is like take two or three questions and then we'll take them as a group, please. Yeah, hi, Dave Ramoswamy with Africa Agribusiness magazine. My question is a kind of follow up to what David said about the political system being trained or re-paradigm to think long term. My question is how do you get the financial system or financial funding organizations which are focused on efficiency to think about resiliency and how do you get pension fund and foundation capital into investing in energy assets? And the second follow up question is in emerging markets where all the new urbanization is happening, how do you deliver appropriate energy technologies to ensure sustainability and resiliency? Simple example, a lot of cities in Africa and India over the last 20 years have cut down trees. And now 20 years later, air conditioners need to run all the time which take out the grid. So how do you balance smart technologies with cheap technology, thank you. My name is Andy Reynolds. I work at the Department of State and urbanization is in our wheelhouse. Everyone looking to Habitat 3, all that the United Nations is doing and transitioning between MDGs, Millennium Development Goals and Sustainable Development Goals. But my question is to the whole panel, it was a very interesting complex storyline but I didn't hear much about demand sized management in the smart cities concept and maybe Amos Evident can particularly talk to that on the front lines. Moreover, in the urbanization challenge, we're talking about a billion people already living in slums. And by 2030, it's going to be two billion people living in slums and the economic momentum and development momentum of the world is not going to change that trajectory. So how do we address the slums and the minimal infrastructure under current slums and growing slums before we talk about shining cities on the hill? I'm Bob Hershia, I'm a consultant. What is being done to try and use the internet to get together the people who want to fund these things and get an economic consensus of them? Okay, anybody want to take any one of or a group of those questions? I'll take the demand side management one. I mentioned it briefly. We believe that demand side management and demand response will be a key part of where the industry is evolving towards smart cities, the energy cloud, however you want to call it. We've actually made some decent progress here in North America. I think there's a lot of work to be done in Europe and there's EU guidelines that recently, well, recently late last year came out. There's the whole EPA 111D discussion here where one of the pillars is demand side management and demand response. We follow discussions where demand side management and demand response would actually be considered another resource. Do I build a plant or do I run programs to manage demand and reduce overall demand and put a return on it? I mean, you know, Ralph Esow from PCNG has been very vocal about the fact that the government and the regulators should actually put a return on investment on demand side management and demand response programs. So we believe it's the start. It's the way, it's the point to start. At the same time, you will need an infrastructure that can actually support that if you want to do it really effectively. I mean, you can change light bulbs. That's one thing and it helps. 25, 30% of savings on energy usage for a building. But it really becomes interesting if you talk about smart city lighting where you have smart devices that know when city lights need to be turned on and off. Also, you know, looking at from a security perspective. So I think there's still a lot of, you know, technology advancement that is possible to even go beyond just changing light bulbs. Sir, I'd like also to address the question of energy, demand, the demand side of it and people living urban centers and increasingly in slums. I think that's a very important aspect of it. So first of all, in terms of energy, we talked about energy as all of the above. And one thing I think we many agree on, I certainly think so, is that we are not short on resources. We are not running out of uranium or natural gas or hydrocarbons or anything else. So despite occasional, you know, peak oil or peak coal or peak solar energy or we are really not running out of resources. The problem is never the resource. The problem is the planning, how to make it sustainable, how to lower greenhouse gas emissions which is a big part of sustainability. And especially important when you talk about urbanization is although energy is growing much faster than almost anything else in real terms, when people move more into smart cities, energy consumption per capita actually decreases and greenhouse gas emissions decrease. But when we go from seven billion people to nine billion people and more and more of these people expect to their expectations rise and they will live a better lifestyle. And those who live in slums and certainly want to get out of that kind of existence, that does drive the need for energy. But other than resilience that we talked about and sustainability and the fact that you don't have to worry about that there's plenty of it out there, it's again that all overused adage that the stone age didn't end because of the lack of stones where the hydrocarbon age and the current energy age is not gonna end because of lack of resource. But delivering them smartly also that last element in this is delivering them economically. And the technologies exist today to do it. And that's one of the biggest factors that can improve the quality of life for people around the world is delivering reliable, resilient, sustainable and lower cost energy. That to me is a main driver. Yeah, I just mentioned an interesting trend and that is you see mayors appointing chief resilience officers around the world. So that, as you know, you said that there's a lot of education that needs to be done but these shock events I think have woken up those that are responsible for these important urban centers. And if actually if you look around the world it's actually cities that are the key elements in generating GDP. It's not the country, it's actually the cities. So the cities are actually important engines of economic growth. And those engines, if the shock events send them into off the rails, it has lots of repercussions. So I think there is a growing number of mayors and if you look at the conferences that the mayors and others in this space are attending and the topics that they're speaking about you're seeing the resilience definitely rise to the occasion, rising up the agenda. And that is leading to a lot of thinking about how do we deal with the financing issues? How do we create the right incentive structures? And on the private sector there have been a number of instances in which supply chains have been dramatically disrupted and so companies are thinking about where do we invest? And that has I think an interesting set of repercussions and incentives for those cities that don't invest in resilience they may not get the next wave of investments. So hopefully that leads to a positive outcome where we see cities taking this seriously and investing it so that they continue to build those kinds of resilience cities that we're seeking. Thank you for the questions. Regarding financial investments I think in the development community the Holy Grail is to somehow unlock the massive flows of financial capital that are sitting in Calpers and Dutch Danish pension funds, et cetera. And have that steer toward clean sustainable development. Well a couple of the things that seem to be necessary to help make that happen are a good predictable return, risk adjusted and a strong project pipeline. Well I think there's a lot of money out there that's made itself available for good returns in green bonds, et cetera. But the project pipeline has not responded yet sufficiently. So one of the big important things is to create key projects that are investable and bankable in cities that foster sustainability and resiliency. One area that we're working on with the World Bank is the international lighting efficiency facility which will help cities attract financing for installing energy efficient LED street lighting. And as you know these systems are very cost effective, very reliable, dynamic controls, easy to install, low maintenance, but the upfront capital investment is a barrier for many cities which have poor credit ratings. So this facility in this case is just one slice of this very big apple is designed to pool cities funds so that they can attract a better rate and attract large investments from the financial flows. So it's one idea, I think it's very important to focus on the additional project pipeline development so that we can help our pension funds find and invest in these large scale sustainable projects. So we have just a couple of minutes left, let's go to Bill right there and then we'll try and take one more question you on the aisle there. Bill Iqord, independent consultant. Jan, I think principally for you, you made a brief comment earlier about the possibility of needing to re-regulate in some areas in the context. I have a feeling I know where you were going with that but my question would be so 30 years ago in the regulatory systems you'd build in redundancy by the PUC or would say build this percentage excess capacity and the rate payer would pay. So fast forward 30 years and the debate now is around things like feed-in tariffs and who pays what rate and that sort of thing. So I'm interested in you unpacking your comment a little bit and maybe others commenting on the state of the regulatory debate about who pays for the resiliency and the redundancy. If I knew the answer that would be great. Now there's a lot of debate happening right now around feed-in tariffs, rate structures, around the distribution of resources that are becoming a bigger part of energy supply. I don't know the answer. What I do know is that certain countries and certain states have made it themselves really complex in terms of regulation and it's, you almost wanna take a white sheet of paper and start again but I think that type of thinking is needed to get a breakthrough because I think the whole foundation of the regulation build up over the years and even deregulation and deregulation, let's be honest, in the beginning it really didn't work well. It wasn't intended to increase competition and improve service to customers at all. It really didn't need one of them. California has the highest rates of the country. Texas, the first three years of deregulation every single customer switched five or six times in the first three years. So again, in the distribution energy resources world you can debate having a highly deregulated environment, how manageable the whole entity is of demand and supply. So I think simplification, I think even to provoke the discussion, white sheet of paper, how would we do it? Not looking at what we have right now or how the regulation was built up over the years but how would we do it in this more distributed environment where again, you have different relationships. Ratepayers becoming producers of power. All these paradigm shifts are significant and I think if people continue to pile on how it was in the past and how regulation was built up I think the solutions will take significant time. So I would say just for the argument's sake design it with the future in mind. San Francisco will be 100% renewable sometime this century. It will happen and it will be 100% renewable sometimes this century. And century is not that long. It's only 85 years from now but they will hit high percentages of renewables and distribution resources really soon and I think the regulation needs to be adjusted significantly as the way the grid is being operated and the different players in that space. Don't know the answer, simplification. Build your regulation with the end state in mind versus on top of what we have now. That will be my advice. Anybody else want to choose? We're just about out of time but I did want to ask one more sort of parting question. Doctor, I've done, you had described sort of the ability to deliver some of these projects that were sustainable and resilient and cost effective and even more on time than in the past with some of these methods. Why wouldn't anyone do that? Why wouldn't you do that? Because there have got to be people who choose not to incorporate all of the sort of most sustainable, most resilient systems. What's the biggest barrier from a practitioner perspective? I'd like to believe that everybody would like to do it if they are, you know, everybody's educated to the possibilities today. There is a very fast rate of change so I think it does take time sometimes as we talked about, for example, the awareness of resiliency as an equally important and sometimes synergistic component. It's always been there but the awareness of it hasn't caught up. Now it is partly due to the events mentioned by my colleagues like Superstorm Sandy and others. So I think that this is part of why we do these kinds of meetings and what the work you do here is to increase awareness. We'd like a sophisticated customer to say, I've heard about this, that's what I'd like. Deliver this to me and we'd like it to be equally private investors and cities and governments and developing world everywhere to just simply raise their standards of what they're asking for. Knowing that it is possible if you plan for it. Well listen, we'd like to get people out on time. I just wanna say a big thank you to Peter and Jan and Amos and David for being with us. I also wanna say thanks to Tam and Anna and Lisa and the whole energy team here at CSIS for helping put this together. We'll be doing more conversations on electricity and transition and I hope there will certainly be other focused events on the Global Sustainability Series so please stay tuned. Thanks very much and join me in thanking our speakers. Thank you.