Pittsburgh’s Transformation Is a Model for Clean Energy Innovation
A subscription to Harvard Business Review would’ve spared President Trump his embarrassing “Pittsburgh, not Paris” punchline, delivered as he pulled the U.S. out of the Paris climate accord. Abandoning the treaty was predicated on preserving American jobs, but if he’d tuned into our HBR webinar, Delivering Economic Resilience in the New Energy Paradigm, he’d have been forewarned that Pittsburgh dismantles his argument. Instead of suffering from the Paris accord, Pittsburgh and its corporate partners stand to profit as pioneers of a clean and green energy future. As Bill Peduto, mayor of Pittsburgh, said after the announcement, the city has already done what the Paris agreement calls for. What Pittsburgh is doing has implications, not just for policy, but also for business strategy and the future of public-private collaboration.
In his inaugural address, the president portrayed cities like Pittsburgh post-apocalyptically, as being filled with “rusted-out factories scattered like tombstones across the landscape.” That vision was correct…about 40 years ago. With the collapse of the coal and steel industries, Pittsburgh experienced an existential crisis in the 1970s, with a deep recession that decimated the city’s population. The crisis called forth what locals call “the Pittsburgh Way”: the ability of community leaders in government, business, and academia to come together and collaboratively tackle the city’s problems.
Pittsburgh’s leaders recognized that attracting businesses and talented professionals would require revitalizing its polluting and aging infrastructure. With the fracking industry booming, some thought the city’s recovery lay in fossil fuels. But with its “Smokey City” moniker, Pittsburgh had paid a heavy price in the last industrial revolution; most people didn’t want to go back to the “two-shirt-a-day” metropolis where streetlights burned around the clock to pierce the smoggy air. The choice for Pittsburgh’s leaders was investing in the future or the past.
The energy that ran the city came from a centralized macrogrid-based power system. Created at the turn of the century by industrialists like George Westinghouse, Pittsburgh was arguably the birthplace of the energy system that lets you toast your bread with electricity generated hundreds of miles away. While world-changing in its day, Westinghouse’s technology is now decades old, and years of underinvestment have left the macrogrid increasingly inefficient and unreliable. Repairs to get the system up to snuff are projected to cost tens of billions of dollars.
To tackle the infrastructure challenge, Pittsburgh’s city leaders pulled together a broad collaboration that included Carnegie Mellon University, the University of Pittsburgh, and Duquesne University along with corporate partners such as Duquesne Light, NRG Energy, and Siemens in an effort to think strategically with local businesses and nonprofits about moving the city forward.
The resulting plan has put Pittsburgh at the forefront of the clean energy revolution. Instead of rebuilding the old centralized system, the smart city project moves toward an intelligent series of district-scale microgrids that interconnect energy generation, transportation, and communications to provide high-tech infrastructure for universities, health care campuses, data centers, communities, and even a city-owned electric vehicle fleet. The new decentralized system will be cleaner, greener, and more resilient, since microgrids can share power in the event of a district outage. With the intelligent data system, even the batteries in electric vehicles become part of the system’s stored energy resources.