- - Saturday, March 6, 2021

Where the widespread failure of the electric utility system in Texas, known as “the Grid,” falls on the spectrum between extensive negligence and the collision of a centurial anomaly with rational cost and risk decisions remains to be fully determined.

What is clear already is that the provision of electricity has joined water and health care in the transition from luxury good, through public service to human right. This has significant implications and suggests opportunities in the competition with China for the United States and allies to provide durable, affordable and clean energy to the world.

The digitalization of our lives has made electricity ubiquitous and essential; we have become dependent. Impacts of outages go beyond losing connectivity and comfort. Electricity is the medium upon which our system of systems is built; it animates everything from public transport to sanitation.

It powers the pumps in our utility systems and the nodes of the Internet of things that monitor and control a vast array of infrastructure.  Our supply chains for food, fuel, heat, water and information rely on it and so do we. The reaction and political fallout in the wake of the blackouts is indicative of the instability and unrest at stake when a system fails.

Across the developing world, the demand for electrical power is growing. Estimates show electricity demand growing at 2.1% per year out to 2040, at which point developing countries will account for 67% of global energy use. As the world population further urbanizes, growing to 9.8 billion by 2050, the demand for electricity and its status as a human right will become a definitive feature of geo-political considerations.

As the fragility of the grid demonstrates, our world can ill afford disruption of service, and while this problem is noteworthy in Texas it will be nightmarish in the highly urbanized and nascent economies where politics and security are already volatile. In a world pervaded by the use of electrical power, safe, reliable and affordable production and supply of energy is key terrain in the struggle to preserve the liberal order.

In light of this, the deliberate efforts of the People’s Republic of China to construct electrical supply infrastructure in the developing world through their Belt and Road Initiative (BRI) are indicators of where the U.S. and allies need to engage, why engagement is critical and how vulnerable the Chinese strategy is to Western intercession.

The BRI has been predominantly focused on energy with two-thirds of investment in that sector. The efforts include both fossil fuels and renewables and account for generation and distribution. Geographically, they are diverse, spanning from the Americas to Africa; the largest number of projects are concentrated in its Southeast Asian neighbors, notably Indonesia, Laos and Cambodia.

This ambitious reach for energy market share is a precursor to expansion into a global energy grid, and a global industrial base and supply chain. The supply chain resilience issues highlighted by the COVID-19 response are instructive in framing the implications of these steps for captivating the developing world (imagine the coercive power of dictating the flow of electricity). 

As a stratagem, the BRI has not been uniformly successful. High project costs, unequitable contracts that favor Chinese investors, lack of skill transfer to the host nation (due to importing Chinese workforces) and particularly the imposition of unmanageable debt are increasingly convincing BRI target countries that China’s industrial cooperation plans are not in their best interest and marred its popularity. This feature is a gap which should be exploited by fielding modular nuclear power systems and smart grid technology into the developing world.

While the PRC maintains an asymmetric advantage in many areas of energy supply construction, this is not the case in the field of small modular nuclear reactors.  

Nuclear power currently provides the only realistic solution for meeting the predictable demand for clean electricity facing our planet, while concurrently addressing emissions at the scale needed to meet climate objectives. Advanced small modular reactors (SMRs), for example, offer multiple advantages, including “relatively small physical footprints, reduced capital investment, ability to be sited in locations not possible for larger nuclear plants, and provisions for incremental power additions.”

Further, the U.S. industrial base can provide the durable technology and advanced efficiencies needed in next generation electrical grids and outperform the PRC in key metrics of quality, fuel-cycle protection, and maintenance. This provides U.S. and allies a precious opportunity to secure the future through the delivery of secure and affordable energy. 

To seize this opportunity, the U.S. government must lead by providing guidance to the Departments of State and Energy to take the initiative with relevant countries (particularly, the U.K., Japan, Canada, Australia, the UAE and Korea) to enable formation of public-private partnerships. 

The United States should immediately engage with the U.K. and Japan to form a U.S.-led, allied-supported strategy to deliver Energy for Humankind, leveraging alliances with 5 Eyes, NATO, and the 3 Seas Initiative. These provide the foundation for a strategy by which the U.S. can move from transactional energy independence to Geo-Political Energy Dominance and Leadership.

The president should introduce a private sector led global energy strategy that addresses concerns about de-carbonization while re-establishing America as the 21st-century leader in clean infrastructure development.  

The dual lessons of the coronavirus pandemic and the grid’s failure have shown the folly of dependence on the PRC and the criticality of safe, reliable, electrical supply for stability around the globe. It is imperative that the United States and allies provide an alternative for energy supply to the developing world.  

The U.S. nuclear power heritage and industry in operations remains the best on the planet; a U.S.-led, allied-supported global energy strategy will empower the private sector to compete in the international nuclear arena and instill confidence in the $10 trillion global nuclear energy market that the U.S. is returning to its important role as the country of choice for the peaceful delivery of clean energy. 

• Robert C. McFarlane is chairman of an international energy company and a former assistant to the president for national security affairs. Matthew R. Crouch, a U.S. Marine Corps lieutenant colonel, is a senior military fellow at the Atlantic Council. An Olmsted Scholar, he lived in Shanghai, China, from 2009-2011. The views and opinions expressed here are those of the authors and do not necessarily reflect the official policy or position of the U.S. Marine Corps, Department of Defense, any agency of the U.S. government or other organization.

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