 Energy man Stan Osterman here coming to you live and direct on the thing tech from Kailua Hawaii and uh hope everybody's doing well staying healthy um staying sane after all the stuff that's been going on the last couple weeks and uh keeping your head on your shoulders but today shows a a little bit different I was telling the production folks that um this is kind of the sister show to a show I did back in October of 2016 actually was on October 14th 2016 where I talked about critical analysis and why critical analysis was so important before we made big decisions about energy storage and things like that that you know things like batteries and and hydrogen and and um pumped hydro and things like that you couldn't just go energy and energy out decision made you actually have to look at where the products materials come from you know where where are those located who owns those what countries own them are they in short supply are they hazardous um you know are they dangerous does the technology cause any other problems like fires and things like that and I was pointing out in that video that you know we we tend not to do a lot of critical thinking nowadays and I I attribute that to the fact that information is so available um with Wikipedia and Google and you can do a search here you can get a GPS location just get your way there we just become so used to quickly finding information that we don't bother in many cases to do in-depth studying and the bad side of that is then you can easily manipulate people because you can give them just part of the truth or part of the story and deceive them that it's actually a good decision and that that happens a lot a lot more than most people realize nowadays um but the sister topic of that is the one I'm going to talk about today which is risk management risk assessment and to start off with I want to talk a little bit about you know why um that's kind of a focus of mine uh you notice in the background I have a couple of airplanes on pedestals and stuff there airplanes that I flew in the military and in the military um we used to say in the air force safety first and after a couple of years people started talking about that in terms of a mantra and saying well if safety's first then we shouldn't do this and we shouldn't do that we shouldn't be in combat we shouldn't do this and we because none of that's safe and if safety is first then we can't do our mission we we can't fly airplanes because flying airplanes isn't safe and flying airplanes in combat certainly isn't safe so is it really safety first and so our air force safety folks really and they're awesome people they do incredible work they started training us on risk management risk analysis risk management uh and how that fit into our routine so let me kind of give you a picture of what it's like in a like a fighter squadron when you're doing everything from scheduling crews to putting missions up to going to combat what you think of as a leader in one of those organizations and you're trying to handle risk in other words you know what you're going to do is dangerous but how do you minimize the danger how do you minimize the risk and then at the end of the show we'll talk about how that dovetails in to energy and why it seems like sometimes we can't get the good parts of energy online fast enough or or you know brought about and and get over that hump and a lot of it has to do with risk avoidance in other words people don't want to do risk analysis so they don't know how so they just avoid the subject all together and just kick the can down the road so in the military if you were in a flying squadron the first level of risk assessment or risk analysis is done by the scheduler the schedule would sit down and say okay how many airplanes do I have who needs what kind of training and he starts putting a schedule together starts building the schedule and he tries to make all of the training fit the number of airplanes he has and the number of sorties that the pilots need who's who needs the currency the the soonest because they're going to run out of currency and landings or something so he does the kind of mechanics and he's the first level of risk analysis because what he's trying to do is not take somebody who hasn't been flying for a long time and turn around and stuff them into a really complex mission to get a whole bunch of their training done and and oversaturate them and put them into a situation where he could get overwhelmed kind of balances the training that needs to be done with the time that's available and the missions that are available to do for that week because sometimes you're doing air to air sometimes you're doing air to ground sometimes you're doing navigation missions sometimes you're doing instrument training sometimes you're in night flying sometimes you're doing refueling and how does that all fit together so the scheduler actually has the first crack at risk analysis and trying to make the right crew members fit in the right spot on the schedule way above the scheduler is the ops officer or the squadron commander but usually the ops officer because he's a more hands-on guy now what he's looking at is he's looking at the schedule and going well wait a minute you know captain so-and-so he just came off of being down for a flu virus and so he's still got some medical side effects and maybe even taking medication I don't know if I want him doing that sorty and so the ops officer is looking at things like that from a big picture or he may know that a certain aviator has financial issues that the rest of the squadron doesn't know anything about because it's kind of confidential or maybe having personal problems or things like that where the ops officer and the commander might be aware of this stuff but the rest of the people running the squadron don't and so they look at the schedule and they look and they see are we really doing the right thing by having this particular aviator doing that particular mission are we over are we gonna oversaturate him and maybe bring him into an unsafe situation and in between those two individuals you have what we call the SOF or the supervisor of flying now that guy he's kind of what we put at the tactical level he's the one that's taking the schedule and getting the crews together and executing it but he starts to bring in factors like what's the weather like have they shut down the primary runway on the base and we got formation takeoff scheduled but the secondary runway is not wide enough for formation takeoff you know he starts dealing with the nuts and bolts of what's going on on the ground and what he's got to deal with to make sure that we can fly safely you know he looks at the the weather in particular and says wait a minute I've got two young guys flying this instrument sortie and it's no joke really instrument conditions you know and I need I probably should have an instructor in that flight and not just two young you know basic level entry level fighter pilots or whatever so he'll sit there and he may actually adjust the schedule or change cockpits or change missions a little bit after coordinating with the scheduler and the ops officer to make sure that he's taking the the real what's what's happening on the ground in the air with the weather and some other things like that and fitting it in there so maybe all of a sudden the wind comes up and your sea state's so high that it it gets dangerous to fly period and he might even have to cancel some of the flying because it's just not safe you've entered something not safe so the military's done a really good job especially the aviation community in doing what we call risk analysis and the unfortunate thing is risk analysis takes time and it takes really trained people that are looking for the full spectrum of things that could impact those flyers and what they're doing the weather their their personal lives their medication their their mental state their currency and flying have they not been fine did they just come back from combat operations one of the things I'll tell you when I was flying in a crew airplane is actually counterintuitive but but for me played a big part in my risk analysis was do I have two instructors or three instructors on the flight deck you would think that that would make it a really safe safe flight if you have three highly qualified instructor evaluators on the flight deck I think if you looked at flying history you'd find that that's the most dangerous combination of people on a flight deck because they all know what they're doing and nobody questions the other person when they're doing something that doesn't look right and I remember Korean Airlines flight that landed in in San Francisco with a highly experienced crew on board and they let a very experienced pilot fly the airplane right into the ground shorter the runway and they were lucky they didn't have more fatalities in that flight and that's the scenario you're you're better off with an experienced instructor and a really inexperienced co-pilot or a brand new co-pilot and another pretty experienced but not an instructor or just maybe a brand new instructor in the co-pilot seat you know you really have to watch it it doesn't necessarily mean that the most experienced person is the best person there so the the Air Force and the Military Aviation Committee in general has done a really great job of risk analysis but we in the civilian world in the business world in the political world in in the energy world we don't we're not so good at it and the reason is it's too easy to just defer it and say oh it's too risky we're not doing it it's too risky my investors won't go for it it's too risky you know maybe we're just going to stick with our current technology so how does that come down in say a company you have a company they're really they're really comfortable in in the business that they do they've got a track record they've had steady growth in their whole history but a new technology comes along and they're they're saying no you know our we've always had a track record this is good you know we we've got a history we've got proof that our our business model works well think of the bell telephone company think of what happened when cell phones hit and everybody started dumping their landlines on their home phones because of cell phones you can't just get comfortable as a business with what you're comfortable with or what's made you successful in the military we say you you don't you can't build your future fighting the last war you can't use the same weapons and the same tactics and the same everything because guess what your enemy's read your history books and and watched you and now analyzed your your tactics and things so at the very least your enemy's up to speed and how you usually do it you need to be ready for the next war and that's true for businesses too they have to be ready for the future they have to plan for the future they have to look at the future one of my personal projects when I worked for the state in the energy side was trying to get Hawaii gas uh our local gas utility that has PUC regulations because they're they run gas lines across tax map keys and and they're basically regulated to to make sure they treat the the population fairly and pricing fair and everything and I had a hard time convincing them in fact I'm not sure they're totally convinced at the higher levels that the next natural gas replacement is hydrogen and a bunch of their engineers that understand hydrogen and understand that technology they get it they're all over it they're telling me to stand we we understand this but you know the shareholders that's who the leadership reports to and they're not quite there yet so we're just going to have to take our time and keep plugging away so at the company level you have risk management that's driven by shareholders you have risk analysis that's that's pretty short sighted it's like you're taking care of your current shareholders but when the bottom drops out of your industry and suddenly you find yourself chasing the guy who has the latest technology your shareholders won't be really happy so you better start doing some some risk analysis start looking at new technologies and try and project out in the future and plan your future if you're running a company so but it's not just it's not just companies there's people on the other side venture capitalists you know we're we're big into a new industry and high tech transition here and a lot of a lot of different industries I mean I can't think of an industry that's not impacted by high tech at this point even agriculture farmers are using GPS in their in their tractors and their combines they're using computers to analyze their soil moisture and programming which way their their irrigation systems do most of the the hydrating of their fields and when they do it and you know throwing in weather analysis to make sure they do it at the right time and time of day and things like that and if you don't if you don't do that stuff if you don't take that into account as part of your risk analysis you know what's going to make me succeed in the future you fall behind really really quickly but venture capitalists they're the people that work on these startup companies these tech companies you know they can't afford to be risk averse they have to sit there and they really that's why usually a venture capitalist look at companies that are emerging and they really go and tear the business plan apart and try and bring in new technology questions and and looking and so I'd say venture capitalists that that help tech companies and help new businesses are probably some of the most adept at doing risk analysis because their new investors will lose confidence in them rapidly if they take too much risk and or don't look at things well enough to recognize real good technology because they didn't do decent and not critical analysis as I go back to that October 2016 show the critical analysis with venture capitalists then you have another sector that really I don't think people realize how much is driven by the insurance sector it's really really big and if there's one word that can be associated with insurance directly it's risk so what we're going to do is we're going to take a quick break here and when we come back from the break I'm going to talk a little bit about the insurance companies that that help us stay legal driving our cars and and pretty much every professional has an insurance policy to protect them from being sued we'll talk about that after the break aloha I'm John David and the host of history lens on think tech Hawaii history lens deals with contemporary events and looks at them through a historical perspective or what we call a history lens the show is streamed live on think tech Hawaii.com thanks so much for watching our show we look forward to seeing you then mahalo and aloha back to Stan the energy man Stan Osterman here and we're talking risk and we we before the break we talked about insurance companies and if anybody does risk analysis in industry really really well it's an insurance company insurance companies look at all kinds of risk they they look at the particular professional risk that certain you know contractors or companies have to take on but a big chunk of the risk that seems to occupy their time and their financial concern is what we would call liability or tort risk where people like doctors or other professionals who would get sued for malpractice or not doing a professional job at whatever they're doing or counting or whatever can be taken to civil court and sued and those insurance companies have to do a risk analysis on that so if you really want to get into studying you know risk analysis on a corporate level look at an insurance company let's look at some of their customers like doctors for example how does risk start to drive things like medical costs well if the courts are taking civil cases where a doctor makes a mistake and causes harm to a patient and then the patient comes back and sues that doctor in civil court and then the courts award one million two million ten million dollars for damages and punitive damages and and and other damages the insurance company usually pays a big bulk of that or sometimes the insurance company will go to court against the doctor and try and contest the fact so they don't have to pay that much of it and leave more of the burden on the doctor well if you can imagine that kind of insurance for malpractice gets pretty pricey especially depending on what kind of surgeon or doctor you are you can actually have so much liability out there and so much risk that it's hard to get medical insurance coverage for you and when you do it's really expensive so like every other product when there's an expensive piece to it that's that's got to be paid and is part of the basic cost of doing business it gets passed on to the consumer that means it gets passed on to the patients who have to put the bill for their medical care or the insurance companies that put the bill for the medical care now that's that's not just for medical malpractice so to speak but also the fact that when you have a doctor that say he's got a pretty good idea what's wrong with you and so he wants to prescribe a few things and does a few tests but he eliminates a couple tests because he's he's pretty certain that's not a factor well there's people with two doctors because they didn't do tests so the standard practice now in a lot of medical professions is i got to give you every test even though i don't think you need to test or i got to give you every drug even though i don't think you need a drug because if i don't i'm going to get sued for not having you try it and that also is just crazy in terms of risk analysis so our legal system and our tort system i think needs a little bit reform on the medical side because risk analysis is obviously missing from some of the the logic in how we do medical care finally because i want to kind of wrap this thing into the energy side is politicians um i've noticed fairly recently and i talked about it in that october 2016 show one of the most risk averse um career fields in the world is politics um you've got politicians who just look at polls and they'll be conservative one day and liberal the next day based on a poll of uh you know or a couple polls that say he should be one way or the other and that's a hell of a way to run a career and and you know run governance or do leadership is to sit there and flip flop on issues based on polls not actual facts or data or statistics or morals or anything but you're just trying to please your constituency and get votes or please the people that contribute to your campaigns and and that's where we run into a lot of trouble and therefore you dovetail in the energy piece which is the crux of what i wanted to talk about today and i'll wrap it up with that you know we're in an in a world where we're talking climate change and carbon reduction and getting rid of fossil fuels and things like that and if you watch my show at all you know i'm all about that i'm all about cleaning up our internal combustion engines in our cars and cleaning up our grid and the pollution especially here in hawaii that we generate burning fossil fuel for electricity i'm all about you know solar and wind and even the good old-fashioned hydroelectric i mean we have we have hydroelectric sources on in our state that are untapped we used to have have flumes that moved water all over this island for sugarcane and pineapple and we should be using those for hydroelectric power and we don't but why the reason is our politicians are risk averse they look at what's going on in the world or their community right then and if it conflicts with what we should be doing long-term strategically and well thought out and well planned and well risk analyzed um we'd be focusing on cleaning up our energy if we if we focused on our economy in hawaii we would be focusing on energy not all the other garbage that seems to be important to you know people today and why do i say that i don't know what economists in the state that would look at the amount of money that the state of hawaii spends on fossil fuels or transportation and for electrical generation and if you if you told that economist we're going to get rid of all of that bill that entire expenditure and we're going to be self-sustaining we're going to not buy energy from anybody else we're going to take the energy generation we have from geothermal and from solar and from wind and from hydroelectric and from any other number of sources wave motion ocean thermal whatever and we can produce and i've talked to a lot of professionals around the state we can produce about eight times the electricity that we need in the state and transportation electricity included if we're all electric vehicles from our natural resources here in the state and if we did that we could actually have a completely robust economy that didn't depend on just a couple markets to keep us afloat so let me give you a current example of that we used to as i said have sugarcane and pineapple as part of our agricultural backbone or economy and the three legs of this economic school in hawaii has always been agriculture and tourism and the military because the military has a big presence here the military brings in a lot of federal funding and a lot of soldier sailors airmen marine coast guardsmen that spend a lot of money in our stores and buy cars here and things like that so the military is a big chunk the military is the biggest customer of wine electric so the military is really important here but so is tourism tourism creates a whole lot of jobs in Waikiki whether it's housekeeping or cooking and tour tour guides and tour buses and you know it's huge but we lost agriculture we don't grow much pineapple or sugarcane anymore we have a couple of notional fields up in in kuniya where we have pineapples for the tourist it's it's basically to to give pineapples to the local market here and to have pineapples to show tourists what we used to have in hawaii in terms of a big agriculture so we're down to military and tourism well what's happened to us with the COVID-19 is we've had no tourism since early march we quarantined our local inner island travel up until this week where you had if you traveled inner island to another island you couldn't leave your hotel room or your residents for 14 days that's lifted as of yesterday or day before yesterday and now we still have a quarantine for tourists coming in and we've arrested a whole boatload of tourists who have violated their quarantine and turned them into felons or at least lawbreakers find them and even sent them home because they couldn't stay in their hotel room for 14 days after spending a bunch of money to get here even our local bed and breakfast folks are getting slammed for not quarantining people that come in as tourists so two legs of our stool are pretty darn either not existed anymore or so fragile that the next pandemic or the next the next thing that stops our tourism whether it's high oil prices or whatever is going to cripple two of the three legs of our our economy already and all we have left is the military and that's really scary for the people that live here and have to survive so why is it that getting our environment and our energy sector self-sufficient like as soon as you can why isn't that a priority it's because politicians are risk averse politicians don't focus on the long-term big issues they look at what's going to get them a vote this week or next week they're notorious for kicking the can down the road and worrying about it later they talk a great story everybody was poo-pooing president trump for backing out of the paris climate accord every single one of our mayors and our governor said well we're not going to do that we're going to go full steam ahead i don't see a whole lot i mean not a whole lot of actual work being done of actual things being done to eliminate our fossil fuels even Hawaiian electric they still they're doing battery testing they're doing they're trying to put some more solar panels up here and there but they can't take a whole lot more intermittent renewables on their grid it's too unstable so when we talk about risk and we talk about risk analysis and risk being risk averse we can't get new technology out if adventure capitalists don't want to put the money in there because they don't trust the technology we can't put new technology and better energy solutions out if the politicians are so risk averse and can't do good risk analysis to do strategic planning and give them a better picture of how they could improve a bigger picture if they would do full risk analysis we can't go anywhere if we keep a narrow band on our view of how we view risk even the fact that the the quarantining or the the stay-at-home orders that were issued by governors and and professed by the cdc they were totally medically driven but not economically driven and it wasn't too long before we saw the economic impact but there were there economists that would have told you the economics are shutting everybody off and telling them to stay home it's going to be devastating well it took the politicians two or three weeks to figure that one out that's the kind of short-sighted risk analysis we do nowadays we can't afford to do that with energy we need to put the energy pieces together that are going to keep us going clean up our environment get rid of carbon-based fuels and and co2 we need to do it sooner rather than later and if we don't do good risk analysis we're going to do a poor job at that so i think that's about it for risk analysis and energy today thanks for listening to my thoughts on it i've been around the world for 66 years and learned an awful lot and just trying to share it with you so until next week just stand the energy man signing off all