SimpliPhi Celebrates A Decade of Innovation With an Urgent Call to Action
Written By Catherine Von Burg, CEO & President
Since our founding in 2010, SimpliPhi Power has been on a mission to create universal access to safe, reliable, and affordable energy to empower people, communities, and enterprises globally. Today, SimpliPhi has deployed energy storage systems in more than 40 countries, optimizing a diverse portfolio of energy generation assets across a broad range of applications and markets. From inception, our company set out to leverage energy storage to make an impact on six overriding imperatives that are still highly relevant today:
- create resilience and security by providing customers access to power 24/7;
- solve the intermittency of renewables;
- increase renewable generation in urban and rural, as well as developed and developing, communities;
- reduce reliance on fossil fuel generation and thereby decrease GHG and CO2 emissions that drive climate change;
- deliver power to the 1.2 billion people who are economically marginalized simply because they lived beyond the grid, and
- create opportunities for sustainable economic development, innovation and job growth.
In 2010, the intermittency of renewable generation was a strong deterrent to rapid and widespread adoption of renewable energy generation. When the sun set or the wind stopped blowing, people lost power. In 2020, intermittency in power supply is as much a problem for the electrical grid and its outdated model of top down centralized transmission and distribution as it is for renewable generation. As climate change and catastrophic weather events continue to increase in frequency and severity, disrupting and in many cases destroying utility infrastructure, leaving millions across the US without access to power for days or even weeks at a time, it has become clear to homeowners and businesses that customer-sited energy storage is more critical than ever. Whether energy is generated by fossil fuels or renewables, or is centralized or distributed, people and communities are recognizing that they need to store power and create their own reserves to make sure their lives and businesses are resilient and secure.
Climate Data: Disasters & Economic Impact
According to NOAA, as of July 8th 2020, there have been 10 severe climate disaster storm events with losses exceeding $1 billion each in the US so far this year alone. The annual average for catastrophic storms has increased from 6.6 events in 1980–2019 to 13.8 events in 2015-2019 (CPI-adjusted). In California and other western states, we have severe drought, heat and wind culminating in catastrophic fires. Cal Fire reports as of today that 16,400 firefighters continue to battle 23 wildfires in CA alone, with new fires started as of yesterday. Since the beginning of 2020, there have been more than 8300 wildfires that have burned “well over 4 million acres” with over 8819 structures destroyed in CA. Fires continue to rage in other states as well. The danger, beyond the catastrophic impact of these climate events themselves, is that the mounting numbers may seem so abstract that they defy comprehension or sound decision-making . But they are not abstractions, particularly for the tens of thousands of people fleeing their homes and communities in search of safety and shelter. Think about it: these are climate refugees – right here in America. In 2018, The World Bank estimated that climate change will force at least 143 million people around the world to become climate refugees by 2050. Climate scientists now view that estimate as too low. A 2020 ProPublica/New York Times analysis estimated the number of climate refugees in America alone could reach the tens of millions.
As I look out my office window in southern CA, unable to see the mountains due to excessive smoke and particulate hanging in the air crowding out the noonday sun, these numbers feel very real. What is the root cause of all these mounting disasters? Our federal government has suggested the fires are the direct result of CA’s failure to “clean” and “sweep” the forest floors. If this were the case, the federal government would do well to remember that it owns and manages 47.7% of CA’s total land mass, and approximately 28% of all land in the US. So the lack of federal action on fire mitigation techniques based on ‘sweeping and raking’ the forest floor is as much on the feds as it is on CA. But this is just one piece of a global phenomenon being tracked by scientists all over the world. The Amazon forest is on fire (still), the glaciers are melting, sea levels are rising, storms and flooding are increasing. Just ask Floridians.
How much more catastrophic data do we need to accept that these severe weather events are evidence of climate change? NOAA also notes that “the uncertainty of loss estimates differ by disaster” and that “in 2019, six of the fourteen billion-dollar events (i.e., three inland floods events, California/Alaskan wildfires, tropical cyclones Dorian and Imelda) have higher potential uncertainty values around the loss estimates due to less coverage of insured assets and data latency.”
Subsidies: Taxpayer Dollars at Work
In a 2019 working paper, the IMF estimated that global fossil fuel subsidies in 2017 alone totaled $5.2 trillion, or 6.5% of total global GDP, with the US representing its share at approximately $649 billion. The paper goes on to state that “if fuel prices had been set at fully efficient levels in 2015, estimated global CO2 emissions would have been 28% lower, fossil fuel air pollution deaths 46% lower, tax revenues higher by 3.8% of global GDP, and net economic benefits (environmental benefits less economic costs) would have amounted to 1.7% of global GDP”. The International Energy Agency (IEA), estimates that annual global fossil fuel consumption subsidies that developing countries spend to provide citizens with fossil fuels at below-market-cost approximate $400 billion. These are staggering numbers that governments spend, using taxpayer dollars, to prop up an industry that is literally poisoning the air we breath, the water we drink and the environment in which we live, not to mention igniting super fire and storm events displacing people worldwide. This is not sustainable. Despite these advantageous subsidies, big oil and gas stocks have under-performed according to the S&P 500 for a decade – dramatically in the past five years. VDE, the biggest energy ETF lost 57% over the past five years, and nearly 53% over the past 10 years, while the S&P 500 has gained nearly 70% over the past five years, and 190% over the past 10 years. For the first time in history, it is a matter of fiduciary duty to divest from gas and oil companies. That is, if fund managers are truly doing their job to protect the returns on their customer’s investment portfolios. Hence, the move by large pension fund managers to divest from gas and oil.
Going Forward in 2020
When we founded Simpliphi in 2010, we knew that innovating safe, non-hazardous and enduring energy storage solutions could be a transformative force in mitigating some of the world’s biggest challenges, particularly in reducing dependance on fossil fuels, decreasing CO2 and GHG emissions, as well as empowering people and communities to build resilience with customer-sited reserve power. Today, the six goals that inspired the founding of SimpliPhi Power, are even more critical as the human and economic toll of catastrophic climate events accelerates and challenges us to act – now – before it is too late.
As COVID-19 continues to undermine international businesses, markets and supply chains, simultaneously exacerbating economic, social and racial inequities in developed and developing countries alike, solutions are all the more urgent – and available now, as SimpliPhi board member and sustainability pioneer Hunter Lovins writes in the groundbreaking book, A Finer Future. In our first 10 years, we’ve made progress, but there is still much to do. As former UN Secretary-General Ban Ki-moon said back in 2012, access to “energy is the golden thread that connects economic growth, social equity and environmental sustainability”.
SimpliPhi is a profitable, revenue-based company – a rarity in this industry – that continues to grow because of the efficacy, safety, cost-effectiveness and flexibility of its technologies, as well as our focus on leveraging energy storage to solve real-world problems. The company has not accepted VC money and has had at its core a fundamental belief that companies executing on the integrated bottom line, or triple bottom line – people, planet, profit – enjoy a healthier return on investment, including start-ups and early stage companies, while catalyzing change for the better.
As a company, we could not have had as great an impact without our customers and partners, domestically and abroad. Therefore, integral to our celebration and success is a celebration of you, as well as a recognition and call to action that we must do more going forward – together. All of us must divest from fossil fuels and continue to invest in our companies, the renewable energy industry at large, as well as each other through ongoing collaboration and sustainable, community focused projects. Thank you all for a great 10 years, we look forward to continuing the hard work to change the world for the better.
Stay tuned for announcements as SimpliPhi introduces more innovative solutions and initiatives that formalize the guiding principles that have served our company and partners so well.
Catherine E. Von Burg