resilience: global imperative for 2013 and beyond_mesh evans april 25 2013

General Electric © 2013 – All Rights Reserved

Resilience

GE

Peter Evans, PhD Director Global Strategy & Analytics Mesh San Francisco April 25, 2013

Global imperatives for 2013 and beyond

2 GE Confidential & Proprietary Information. GE © 2011 – All Rights Reserved

Global shocks Global economy confronts major disruptions

Source: Oxford Economics Outlook, August 2011 and various media reports

Global economy Recent shocks

GDP growth

Social/political unrest

‘Arab Spring’

Natural disasters

Japan earthquake

and tsunami

Financial

European debt

crisis

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3

US Natural Disasters - Energy Impacts

Hurricane Sandy October 2012

Source: U.S. Department of Energy; EIA

Category 1 hurricane.

Second-costliest hurricane in US history

Customers lost power

>10 Million

>$50 55% Key East Coast oil refining capacity

shutdown • Millions lost power across 21

states.

• New Jersey was the most

badly impacted with 10% of

customers without power –

while other states saw less than

3% of their customers suffer

electricity outages.

• 0.6 million barrels per day

production loss through refinery

shut downs or reduced runs.

• Two refineries were shutdown,

and one refinery reduced runs

due to hurricane Sandy.

Other impacts: • More than 600,000 cars could be

damaged.

• According to IHS Global Insight.

Sandy could cause about $20 billion

in property damages and between

$10 billion and $30 billion in lost

business.

Billion In total estimated

damages

4

Rising economic cost of disasters Over $160 billion in overall losses in 2012

Hurricane Sandy, USA

October 2012 Overall losses: $50bn Insured losses: $25bn

Top 3 largest natural catastrophes*

1 Drought: Midwest USA

June-September 2012 Overall losses: $20bn

Insured losses: $15-17bn

2 Earthquake, Italy

May 2012 Overall losses: $16bn Insured losses: $1.6bn

3

Note: Ranked by overall losses; Source: Munich Re NatCatService 2013

5

Over 26,000 units are in areas of medium to extremely-high water stress

Global generation units with water stress* Medium to extremely-high stress

*Notes: Includes thermal and hydro plants. For visualization purposes,

plants with design capacity less than 100 MW are not shown.

Source: Platts UDI Database 2012 and WRI Aqueduct data

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Water-reliant generation units Percentage residing in areas of medium to extremely-high water stress

India

66%

USA

49%

*Notes: Includes thermal and hydro plants.

Source: Platts UDI Database 2012 and WRI Aqueduct data

China

51%

7

Cities at high risk around the world Exposure to multiple natural hazards*

~60% of major cities/ ~1 billion people at risk to at least 1 major natural disaster

*Risks to cyclones, droughts,

earthquakes, floods, landslides,

and volcanic eruptions

Source: UN DESA/Population Division, World Urbanization Prospects: The 2011 Revision

*Notes: Includes cities with more than 750,000 inhabitants in 2011.

Hazards


8

World-wide natural disaster trend Annual rate of over 800 events in recent years

Source: Munich Re, January 2012

Number of events


12,000 Number of world-wide disasters

likely in the next 15 years*

*Assumes continuation of current trend rate of 800+ natural disasters per year


10

Resilience… the ability to bounce

back faster after a stress or shock, endure greater stress or shock, and/or minimize the impact of a stress or shock.

11

Growing attention to resilience Selected list of organizations and programs

Stockholm Resilience Centre

Sandia National Laboratories

“Energy, Climate & Infrastructure

Security”

Durham Univ.

Institute of Hazard,

Risk & Resilience

Univ. of British Columbia

Institute for Resources,

Environment & Sustainability

World Bank

“Planning for Urban Resilience in the Face of

Disasters” (2012);

“Climate Resilient Cities” (2008)

Rockefeller Foundation

Asian Cities Climate Change

Resilience Network

UK Energy Research Centre

“Building a Resilient UK Energy

System” (2009)

Asian Disaster Preparedness Center

“. . . sustainable development through

disaster risk reduction”

Australian Govt.

“Critical Infrastructure Resilience

Strategy” (2010); Trusted

Information Sharing Network

United Nations

Division of Sustainable Development;

Rural Resilience Initiative;

International Strategy for Disaster Reduction;

“World Risk Report” (2011)

EU

European Network & Information

Security Agency, “Critical Information

Infrastructure Protection and Resilience”

National Academies

“Disaster Resilience: A National

Imperative” (2012)

Colorado State Univ.

Institute for Society, Landscape &

Ecosystem Change

Source: Various media reports, 2013


12

Managing shocks

Time

Critical Assets

Risk Mitigation Recovery

Disaster

Preparation

Response

Source: Adapted from World Economic Forum, “A Vision for Managing Natural Disaster Risk”, April 2011

Before, during and after

Supporting business continuity is a growing need

Business continuity


13

Building resilience

1

2

3

4

Diversification

Redundancy

Couple / decouple

Pooling/ coordination

5

Intelligence

Machines

Facilities

Fleets

Networks


14

Resilient-sustainable infrastructure (RSI) Green + robust = RSI

Source: GE Energy, Global Strategy and Planning, 2012

“RSI”

Status Quo

Greener

Environmental footprint reduction

H

L

Robust

Resilient L H

15 /

GE Confidential & Proprietary Information. GE © 2013 - All Rights Reserved

Innovating for Resilience New products and business models

EX

IT

M

ET

RI

CS

EX

IT

M

ET

RI

CS

CROSS THE CHASM

SCALE THE BUSINESS

RUN THE BUSINESS

OPTIMIZE THE BUSINESS

1 2 3 4 5

EX

IT

M

ET

RI

CS

GET TO MARKET

EX

IT

M

ET

RI

CS

Commercialization

INCUBATE

Innovation

ACTIVATE

16

Digital…crowdsourcing resilience Mobilizing ‘digital volunteers’

Digital Tools & Platforms

Medical care/ shelter

Damage Assessments

Allocation of skills and expertise

Financial assistance

Maps & Coordination

17

Fukushima’s digital response

March 11 March 12 March 14 April 8

Events

Examples of Digital Response Systems

Earthquake Nuclear Accidents

Mandatory Power cuts

Start

Power cuts End

Timeline of 2011 events and digital response

1 day 2 days

Crisis Response website (Mar 11)

Volunteer info (Apr 25)

Power forecast (Mar 23)

IPhone person finder (Mar 16)

GIS tools for Shelter Info (Mar 12)

Radioactivity info systems (Mar 15)

Source: Adapted from Utani A, Mizumoto T, Okumura T,“How Geeks Responded to a Catastrophic Disaster of a High-Tech Country,” ACM SWID 2011

25 days

Volunteer platform & relief supply matching system (Mar 12)

Baby refugee evacuation tools (Mar 20)

Scheduled power-outage info (Mar 13)

GIS tools for Traffic Info (Mar 14)

Animal/pet finder (Mar 13)

GE’s FastPower delivers a fully functional, onsite power plant

Rapid deployment and integration technologies add or replace energy assets world-wide

Fast backup power:

Product Innovation:

19

Distribution automation… Recloser Control System (URC) enables the efficient recovery of distribution system networks

Source: General Electric, 2012

Software Innovation: Deployment of intelligent automation of grid networks to reduce customer outages


1

Call to Action Identify and implement measures that ensure that critical infrastructure is resilient as well as sustainable.

Close governance and policy gaps Enhance coordination across government bodies responsibility for sustainability on the one hand and natural hazards preparedness on the other at the local, state and international levels.

Accelerate innovation Devise new policy architecture and incentives to advance technologies that provide resilient and sustainable infrastructure in US and globally.

What’s next… the missing pieces

Resilience

GE

Peter Evans, PhD Director Global Strategy & Analytics Mesh San Francisco April 25, 2013

Business imperatives for 2013 and beyond

resilience: global imperative for 2013 and beyond_mesh evans april 25 2013

Technology