The New California Capitalist Model to Initiate the Transformation of the Global Power Industry

Jose Antonio Vanderhorst-Silverio | Aug 17, 2010

        

Kate Rowland has set a challenge in her Intelligent Utility article Smart meter reflux continues of August 16, 2010, which I respond to below. The challenge is based on a quote made by Peter Darbee, CEO and president of PG&E Corporation, which says: 

As we go forward, I think the stakes are very great because once again, California is in the position to serve as the model for the rest of the United States when the United States has said it's not ready to move forward. And the challenge that we have is, are we going to be a good model, or a bad model, or an indifferent model

Hi Kate,

Thanks you for the challenge. 

PG&E and Its Discontents is an article written by Michael Kanellos, on August 12. At this moment it is the most popular discussion in greentechgrid 2010, to which I have added several comments. Next is a comment on two paragraphs:

“PG&E and Its Discontents,” signals a very old backward looking discontent with utilities all over the place. As customers have been unable to articulate their discontent, they follow a leader who gives then something to fight the utility, when the opportunity presents itself, with data that may seem to be convincing, such as the health issues ...

In that line of though, I respond the article Avoiding an Epic Smart Grid Failure, by Christopher Perdue, with the EWPC post An Epic Smart Grid Failure is in the Making, starting with the forward looking sentence “The smart grid is a transformation process of the global power industry. A transformation is not a trivial change. It is a big and complex change process that will satisfy ongoing customer needs, which they are not able to articulate yet.”

Using the same evidence of the above post, I added a comment with the title “A GIANT STOP SIGN! Let's Initiate the Transformation,” under Jesse Berts’ SmartGridCity Meltdown: How Bad Is It?, that says, “I am very sorry to respectfully tell you, and all the other intelligent and important persons, that this is not just the result of skipping the business case. This is A GIANT STOP SIGN, which Jesse saw as one of the alternatives.”

This is also under the article “PG&E and Its Discontents.  My general prediction is that the emergent smart grid is intended to be a shift away from a regulated Investor Owned Utilities Architecture Framework (IOUs-AF) based socialistic AMI monopolistic system, in place now for the retail market, to a capitalist AMI competitive system, which without any loss of generality can be defined under the minimalist, emergent, holistic Electricity Without Price Controls Architecture Framework (EWPC-AF).

 

The above prediction is based on the text Creative Destruction written by W. Michael Cox y Richard Alm. I like to know if the intention of the California government is to not allow once again the emerging creative destruction of the power industry to preserve the preexisting order. To make the meaning absolutely clear, I select a quote from that text:

 

“Over time, societies that allow creative destruction to operate grow more productive and richer; their citizens see the benefits of new and better products, shorter work weeks, better jobs, and higher living standards.”

 

“Herein lies the paradox of progress. A society cannot reap the rewards of creative destruction without accepting that some individuals might be worse off, not just in the short term, but perhaps forever. At the same time, attempts to soften the harsher aspects of creative destruction by trying to preserve jobs or protect industries will lead to stagnation and decline, short-circuiting the march of progress. Schumpeter’s enduring term reminds us that capitalism’s pain and gain are inextricably linked. The process of creating new industries does not go forward without sweeping away the preexisting order.”

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