Energy is about to get cleaner in Portland, and low-income households and people of color traditionally left outside of the green city ecosystem will be involved.

City voters in November 2018 approved an initiative to create the Portland Clean Energy Community Benefits Fund (PCEF). It’s to be capitalized with a 1 percent tax surcharge on the gross receipts of companies with $500,000 in sales in Portland and $1 billion nationwide. A PCEF management team is in place and a committee is being assembled to advise City Council on issuing the grants. Two-thirds of votes cast were in favor of PCEF, revealing its popularity.

Rules for governing PCEF are being developed, with plans calling for the city to begin accepting grant applications in summer 2020. Between 40 and 60 percent of the grant money is to be spent on clean energy projects, 20-25 percent on workforce development, 10-15 percent on green infrastructure and 5 percent on innovative projects that meet city climate goals while generating social and economic benefits. Clean energy projects include home weatherization, efficient HVAC and appliances, and rooftop solar. Both residential and commercial properties are eligible for grants.

Funds can be awarded to only qualified nonprofits, but the nonprofits can pass the money through to private entities for approved projects. Plans call for between $7 million and $10 million to be available for the first funding round. Between $54 million and $71 million is projected to be available annually thereafter, depending on health of the economy and whether exemptions are granted for certain businesses.

A principal goal of PCEF is to engage low-income households and people of color. Engagement will take various forms, from upgrading energy efficiency in homes and buildings to job training and apprenticeships for disadvantaged workers.

PCEF’s future looks bright, but some obstacles will need to be overcome.

One is the threat of lawsuits. Supporters of the initiative that created PCEF emphasized the tax surcharge would fall primarily on big retailers. Think of Target and Home Depot, as well as banks. But it now appears that other types of businesses – including construction contractors, refuse haulers and insurers – will pay as well. Citing violation of the Constitution’s Commerce Clause, groups representing these industries may sue in federal court to enjoin PCEF in part or its entirety.

Several businesses are seeking exemptions from the tax surcharge, and how City Council deals with these may determine whether lawsuits are filed.

Another challenge involves how investor-owners of properties – particularly multifamily buildings – will engage with PCEF. It’s no secret that owners and managers of residential rental properties in Portland are in a sour mood following enactment of rent control laws by the city and state. The initiative passed by voters prohibits landlords from using improvements funded by PCEF as the basis for raising rents. Assuming there will be some kind of matching funds requirement for income-generating properties, landlords wonder how they’re expected to recoup their costs if they can’t raise rents. Improving the efficiency of rentals housing low-income households is a primary objective of PCEF, and most of these units are investor-owned. The Portland City Council and staff will need to figure out how to engage the investor-owners.

A third area of concern arose earlier this year when it was learned that a group of former and current city and state officials, including former City Commissioner Erik Sten, were working with local businesspeople on a plan to tap PCEF grants to leverage as much as $150 million in private investment. The money would be used to acquire, rehabilitate (by improving energy efficiency) and finance construction of affordable housing in Portland. Fred Meyer Memorial Trust might also be involved. In return for PCEF funding, the group would commit to keep future rent increases modest.

As The Oregonian reported, close ties between the involved parties has fed concerns that the group will have an “unfair leg up” in competing for PCEF grants. There is also the aforementioned prohibition on basing rent increases on improvements funded by PCEF. While there is nothing untoward about the plan, it again points to issues that will need to be ironed out.

In seeking to bind climate action with social equity at a scale of $54 million to $71 million annually, PCEF appears to represent a first in the nation. Portland’s experience will be watched closely by those who may want to emulate it. PCEF’s upside is tremendous, but there are still some curves to be navigated.

Matt Slavin founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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A new kid on the block is carving out space in the Oregon economy’s pecking order. Bioscience is a diverse array of establishments spanning industry, education and health care entities. It can be sorted into agricultural feedstock and industrial bioscience, drugs and pharmaceuticals, medical devices and equipment, research, testing and medical labs, and bioscience-related distribution. The latter is categorized as delivery of pharmaceuticals, medical devices and agricultural bioscience products that often require specialized technologies including cold storage and regulated product monitoring, for example.

An economic impact report released earlier this year showed Oregon’s 800-plus bioscience establishments to have contributed $6.5 billion to the state’s economy in 2017, with $3.9 billion in exports. These establishments supported more than 47,000 jobs directly and indirectly. A 2018 report from the Biotechnology Innovation Organization, the national trade association, shows Oregon having particular specializations in agricultural and pharmaceutical products and research and testing.

Major league players are here, including Lilly, Genentech and Amgen. But about half of the state’s establishments have four or fewer employees, and bioscience establishments can be found in each of Oregon’s counties. This is according to Liisa Bozinovic, who relocated from California to Oregon earlier this year to become the Oregon Bioscience Association’s (OBA) executive director.

Signs of confidence are readily found. One is $363 million in basic bioscience research funding obtained by Oregon hospitals and universities.

Then there’s two adjacent buildings to be built in Portland’s Central Eastside Industrial District. Dubbed the NIR Center, for New Industrial Revolution, it will provide 347,000 gross square feet of space – including bio-safety level 2 wet lab space. Bozinovic says these are the first facilities designed specifically to cater to bioscience needs to be built in Oregon exclusively with private money.

“It will help remedy one of the biggest barriers to growth of Oregon’s bioscience sector, which is the lack of lab space,” she said.

Construction of the NIR Center will follow renovation of a three-story warehouse to create a fourth floor. That building, also in the Central Eastside Industrial District, is named the Eastside Innovation Hub. Summit Development Group is the developer of both projects. Of the Hub’s 40,000 gross square feet, 18,000 will be occupied by Lake Oswego-based Revelar Health. Led by President/CEO Chris Marsh, Revelar produces an exhalent device that measures aldehydes in a person’s breath. Aldehydes are a product of cell damage, and measuring them can indicate the presence of diseased cells.

The plan is for the NIR Center to house graduates of the Oregon Bioscience Incubator. Operated by the nonprofit Oregon Translational Research and Development Institute (OTRADI), the OTRADI incubator opened its doors in 2007 in the South Waterfront District.

Many key players wear multiple hats. Take immunotherapist Dr. Bernie Fox who, with his son Bernard Fox III, founded UbiVac. They are developing drugs to enable immune system cells to recognize and attack different types of cancers. Current drugs don’t work in people whose immune systems do not recognize different types of cancers. Perfected, the market for these types of drugs is in the billions of dollars. As for other hats, the elder Fox holds an endowed chair in cancer research at Providence Cancer Center and also teaches at OHSU.

Many bioscience products are regulated by the FDA and other federal agencies while the patents’ underlying innovations are often litigated in state and federal courts, making engagement with government a core priority for OBA.

“Regulations with the best of intentions can have unintended consequences that obstruct the innovation and production cycle,” Bozinovic said, adding “intellectual property protection is a top priority.”

Access to capital is another priority.

“It’s about money, for academic and training programs and to incentivize outside investment in startups and early stage companies,” said Nancy Lime, an OBA board member and senior vice president at device and diagnostics company Sedia Biosciences. This fall, OBA will hold its first Legislative Academy – a day and a half of briefings, forums and visits to company worksites to educate lawmakers on what it takes to continue to grow the state’s biosciences sector.

One more thought: diseases that proliferate in warm climates will become much more widespread due to climate change. Those include malaria as well as dengue fever, Zika, chikungunya and West Nile virus – and North America won’t be exempt. By the same measure, warmer weather will unleash diseases that destroy crops.

CDP, formerly the Carbon Disclosure Project, has reported that executives at big pharma companies expect huge demand for medicines to deal with the climate-induced proliferation of disease. Linking Oregon’s reputation as a leader in the fight against climate change to its growth in bioscience could serve as another area where Oregon bioscience could produce both economic gains and better human health in a hotter future.

There’s a lot happening with bioscience in Oregon. Let’s keep moving the needle.

Matt Slavin founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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Communities relying on beach restoration to fend off erosion due to rising sea levels are facing a crisis. The globe is facing a shortage of sand, The Economist has reported.

After water, sand is the second-most consumed resource globally. With projections that the world will have 43 megacities with more than 10 million inhabitants by 2030, demand for sand to build roads as well as make concrete and glass and other accoutrements of urban life has risen inexorably as the world rapidly urbanizes.

Sand seems like a low-tech solution in a world increasingly likely to look to technology to address climate change. That is the message that came out of a March meeting in Nairobi that considered a proposal to have the U.N. Environmental Programme study geoengineering to combat climate change. The proposal was killed due to opposition by the United States and Saudi Arabia with backing from the hydrocarbons industry.

Pricing carbon emissions and electrification of energy are the two most direct paths to decarbonization. But carbon pricing and electrification may not be enough to forestall overshoot – a��1.5-degree Celsius rise��in global average temperature��above��pre-industrial levels at which point climate change’s��most catastrophic disruptions would be triggered.

Hence, there is rising interest in geoengineering.

Geoengineering is an umbrella term that involves manipulating the Earth’s natural processes to attenuate either the build-up of atmospheric carbon dioxide or its effects. The proposal rejected in March would have had the U.N. Environmental Programme study two approaches: carbon dioxide removal (CDR) and solar radiation management (SRM).

The most technologically mature CDR process is bioenergy with carbon capture and storage (BECCS). It involves burning biomass to generate electricity and scrubbing the resulting emissions to separate carbon and store it underground in large geological formations that can contain the gas for at least a long time if not for eternity. Burning biomass and capturing and storing the emissions produces negative carbon dioxide emissions because the feedstock is sourced from wood and other materials derived from plants that absorb carbon dioxide (Unlike coal-carbon capture and storage, since coal doesn’t absorb carbon dioxide).

BECCS has been tested and works. It’s also expensive, energy intensive, and practical mainly in areas where there are proximal geologic structures to store the carbon. Scaling up BECCS to deal with overshoot on a global level would take time, and it’s unclear if enough land is available to grow enough biomass to enable BWCCS to make a difference.

SRM solutions are based on conceptual models and have yet to be tested in practice. One approach called stratospheric aerosol injection (SAI) would seek to cool the earth’s surface by pumping gases into the stratosphere to reflect some of the sun’s heat. Simulations suggest it could be effective; however, it would be difficult to scale to global proportions, and doing it in just one country could trigger catastrophic weather events in another.

Another SRM approach, marine cloud brightening (MCB), would involve spraying sea salt into marine clouds to reflect sunlight. Simulations suggest it would work at a regional level, although with the potential for disruptions (albeit more localized than those associated with SAI). A third approach would use chemicals for cirrus cloud thinning (CCT), reducing the clouds’ heat trapping effect and allowing more long-wave radiation to escape into space, cooling the earth’s surface.

The practicability of geoengineering to remediate climate overshoot remains to be determined. Less uncertain are the catastrophic consequences that failure to effectively tackle climate change portends. Such events are of the sort of floods, hurricanes and wildfires we’ve seen over the past two years in Puerto Rico, North Carolina, California, Nebraska and throughout the Midwest, and along the Gulf Coast. According to the National Oceanic and Atmospheric Administration – NOAA – the cost of these extreme weather events exceeds $150 billion, not counting the costs of Midwest flooding, yet to be totaled.

A recent CBS poll showed the American people to be awakening to the need to act on climate change. In that poll, 62 percent of people agreed climate change is due to human activity and 79 percent agreed that impacts are serious now or will be in the future. And 59 percent said yes, humanity can do something to stop climate change.

This message has not gotten through to the powers that be in Washington who in March shot down the proposal to study geoengineering. At this point, the stakes are too high to not at least investigate whether geoengineering can be harnessed to help remediate climate overshoot. This message needs to be driven home.

Matt Slavin founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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Drawing attention to the flaws of the Green New Deal (GND) is not to cast doubt upon the exigency of acting to combat climate change. The time to have acted is long past; yet the consequences of failing to act now are too great. If the GND isn’t the answer, what is?

Sorting through the increasingly dire warning of catastrophe in store due to anthropomorphic climate change has become a numbing exercise. In its most recent assessment, the Intergovernmental Panel on Climate Change said global carbon dioxide emissions need to be cut between 40 percent and 60 percent of 2010 levels by 2030 to avoid a nightmare scenario.

After years of torpor, Americans are awakening to the threat, spurred on by seemingly permanent drought affecting wide swaths of the country, horrifically destructive hurricanes, fires destroying areas the size of Rhode Island and the melting of a Greenland ice shelf three times the size of Texas that could raise sea levels along the eastern seaboard to above snorkeling depth. Mosquito-borne pestilence could threaten the health of millions of Americans. A recent survey by Yale University and Virginia’s George Mason University found 69 percent of Americans are now somewhat worried or very worried about climate change.

Headlining the GND resolutions introduced in Congress is the call for a 10-year national mobilization aimed at reaching net-zero greenhouse-gas emissions by 2030, when 100 percent of the nation’s power would be sourced from renewable and other zero-emissions resources. Energy efficiency upgrades would be made to every home and building in the country accompanied by greening of the nation’s infrastructure and transportation system.

Also called for are guarantees of universal health care and education and food security – noble aspirations but perhaps included more to attract support than to decarbonize and foster climate resiliency.

The core problems with the GND are practical and political. There’s the fundamental question of feasibility. Vibrant Clean Energy estimates the cost of achieving the 2030 net-zero goal at almost $1.7 trillion annually – equal to about 9 percent of U.S. GDP and 40 percent of annual federal spending. This is a conservative estimate by a firm that advises the renewable energy industry on managing solar and wind assets. Higher estimates have been proffered by less sanguine constituencies.

Holding constant for Social Security and Medicare, spending on the GND at these levels would crowd out almost everything else the federal government does. Despite Americans’ newfound appetite for raising taxes, there’s no politically palatable level of taxation that would solve this.

Investments in industries made redundant by the GND would become worthless, depleting retirement accounts. And large numbers of workers would find themselves displaced, many without the skills needed to fill jobs in the newly ascendant greener industries. Cutting transportation emissions would require downsizing suburbia to achieve greater densities so commuters would not have to travel as far to work, reducing millions of homes’ values. There’s more, but you get the point. It’s a recipe for unraveling hard-earned public awakening about the need to get serious about climate change.

The place to start with a practicable national climate action program is with a carbon tax or cap-and-trade mandate. There’s no rocket science here – carbon pricing is a known quantity. Taxing carbon incentivizes economy-wide decarbonization, and carbon costs can be stepped year-over-year to accelerate progress without the sort of wrenching dislocations implicated in the GND. The key is to properly value carbon emissions and avoid oversupplying carbon allowances under cap and trade to avoid flaws that have undermined prior carbon pricing schemes.

Next, no matter how successful the United States is in reducing carbon emissions, it will make no difference if other big carbon emitters like China, India and Brazil don’t reduce theirs. The way for the U.S. to incentivize others to decarbonize is to place tariffs on imports of goods from countries that do not impose measurable and enforceable action to reduce their own emissions. Doing this requires the U.S. to rejoin the Paris Agreement to avoid claims the U.S. is engaging in protectionism than versus bona fide global decarbonization.

The third critical element is an accelerated drive to green the nation’s infrastructure. The need is great, but a short list includes accelerating deployment of no- and low-emission vehicle infrastructure, expanding transit, targeting roadway investments to encourage denser development and retrofitting landfills and sewer treatment plants for methane recapture to produce renewable natural gas.

There also needs to be substantially greater investment in research and development. This challenge is twofold: first, practicable and affordable technologies to reduce and eliminate carbon emissions, and second, projections of when our ecosystem will reach the climate tipping point keep getting shortened. Many experts have concluded that even if emissions can ultimately be brought under control, there will be a period during which at least some regions exceed the tipping point (some may have already). R&D needs to focus on not only emissions mitigation but technologies to make the most at-risk places resilient to support continued habitation.

You can call what’s needed a Green New Deal, the Climate Emergency Mobilization and Investment Act or whatever you like. What we need now is action that is both forceful and able to gain the level of political support needed to ensure that it’s enduring.

Matt Slavin founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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As the new year begins, Congress should place high on its order of business enactment of a 10-year, $1 trillion national infrastructure act. It should provide investment capital to renew, rebuild and harden the nation’s transportation, water and wastewater, energy and other critical infrastructure. The $1 trillion should be made available each year in tranches of $100 billion.

The need is clear and present, as delineated in the American Society of Civil Engineers’ (ASCE) most recent national infrastructure report card. It gave the nation’s infrastructure a grade of D – one grade removed from failure. Among the most pressing needs it named:

• $2 trillion for surface transportation, including highways, roads and bridges (only an estimated $942 billion funding is available, leaving a gap greater than $1 trillion)
• $105 billion for water and wastewater infrastructure
• $177 billion for electric transmission and distribution infrastructure
• $200 billion for airports and marine ports, rail networks, inland waterways and dams
• $102 billion for public parks and recreation infrastructure

All told, ASCE has identified a shortfall of more than $2 trillion for investment in national infrastructure assets through 2025. This is more than 40 percent of the $4.5 trillion that needs to be invested through mid-next decade.

There’s no shortage of ideas. Industry groups, labor interests, politicians, universities and think tanks have all weighed in. To be most effective, a forward-looking national infrastructure program should heed the following:

First, and most importantly, smart infrastructure policy requires that highest-value investments be prioritized, with projects being evaluated on a case-by-case basis while eschewing the next shiny object. A national infrastructure bank should be organized along lines similar to the Federal Reserve, with regional banks weighing proposals and making investment decisions under the aegis of a central board composed of congressionally confirmed officials. Organizing along the decentralized lines of the Fed will allow confluence with economic realities on the ground while helping insulate it against political hijacking of investment decisions.

Capital raised through sale of private activity bonds by regional banks would be used to issue loans during each appropriations cycle for projects located within a bank’s geographic region. The regional or district banks would collect repayment of the principal and interest to be recycled to make new loans in the manner of a revolving loan fund. Over time the banks would become self-sustainable. The treasury, via the infrastructure bank, would insure the bonds against default to optimize low-cost financing.

Infrastructure bank investments should require matching funds, a baseline requirement being a 20 percent match, as is generally required for federal transit projects, for example.

Investment criteria needs to acknowledge the different levels of government by which our infrastructure is built, financed and operated as well as that much of our infrastructure is provided by private business. Steadily growing in popularity, public-private partnerships should be encouraged by according private activity bonds the same tax advantage accorded publicly financed infrastructure bonds when projects are undertaken under the aegis of a regional infrastructure bank.

High-value projects for which loan repayment is difficult could be placed on a sliding scale or loans made forgivable, effectively converting them into grants, while smaller projects could be aggregated to achieve the best financing terms.

Projects should be prioritized based on objective scoring methodology that weighs favorably investments that will reduce greenhouse gas emissions and build resilience in the face of extreme weather events like drought, hurricanes, flooding and rising sea levels. Priority should likewise be given to projects that are smart-grid enabled and that harden the nation’s infrastructure against cyberattack.

Allocation of the money to fund the infrastructure bank will require courage by Congress. It will likely need to reallocate money authorized elsewhere along with debt issuance and/or tax increases, including raising and indexing the federal gas tax, which hasn’t been raised in 25 years.

ASCE estimates that failure to make needed infrastructure investments will reduce national GDP by $3.9 trillion and cost the nation 2.5 million jobs over the 10-year period while McKinsey estimates raising U.S. infrastructure spending by 1 percent of GDP would add 1.5 million jobs to the economy.

Creating a national infrastructure bank won’t totally solve the nation’s infrastructure investment deficit. But it will go a long way toward repositioning the nation to effectively compete in the modern economy while meeting the public’s need for healthy, safe, accessible and reliable public infrastructure. An infrastructure bank is exactly the type of national endeavor that all of us should be able to agree on.

Matt Slavin founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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It might be a stretch to refer to the electrification of transportation as a holy grail, but only slightly.

The Edison Electric Institute, the electric utility industry’s main trade group, calls electrification of transportation (EOT) the industry’s biggest opportunity. It’s not hard to see why. Bloomberg New Energy Finance projects that by 2040, annual global electricity consumption from electric vehicles could rise 3,000-fold, from six terawatt hours to 1,800 terawatt hours. Market research firm Frost & Sullivan projects electric vehicle (EV) prices will achieve parity with internal combustion vehicle prices by 2025, when 8 percent of new vehicles registered will be electric, up from 1.4 percent now.

The technology sector is on board, seeing EOT as a missing link in creating “Internet of Things” smart city connectivity. Environmentalists see EOT as a key to reducing globally warming fossil fuel emissions. Wall Street insiders are eyeing traditionally stodgy electric utility equities and stocks of makers of transformers and other electric system components needed for EOT as long-term buys.

State governments will play a leading role in forging the EOT ecosystem because their public utility commissions regulate electric utilities that own and operate the electric distribution lines, substations and associated infrastructure upon which EV charging depends. (Investor-owned utilities are regulated by PUCs; publicly-owned utilities are regulated by governing boards of directors usually composed of elected officials.) Some utilities also own nonregulated companies that operate the approximately 16,000 street-level EV charging stations installed throughout the U.S. That number that will grow exponentially.

Optimizing EOT raises a number of issues. These include:

• identifying and quantifying potential benefits and risks EOT presents for electric utilities, their residential, commercial and industrial customers and society in general, including climate resilience;
• identifying the infrastructure investments needed to build out the EOT ecosystem;
• determining how the investment costs should be apportioned between utilities and nonregulated competitors, government and consumers;
• determining whether EOT infrastructure costs should be recovered from ratepayers as a whole or only those who directly use EV charging; and
• discussing how financial and regulatory incentives can be used to accelerate development of the EOT ecosystem, including in underserved urban areas and nonmetropolitan areas that may not see early EV adoption.

In this context, several issues are paramount.

When forging EOT policy, it’s important to take a big picture view. Most states are divided into utility service areas, but the biggest gains won’t be achieved until seamless connectivity of EOT infrastructure can be established not only within service areas but also between service areas both within states and between states to allow for substantial mobility. A patchwork system in which EVs can be charged in one service area but not in adjoining areas will substantially sub-optimize the benefits that EOT can otherwise bestow.

Next is the need to recognize that optimization of EOT will require massive investments in modernization of electric transmission and distribution grids. They must be strengthened so they can support the substantially higher loads implied by EOT and more seamlessly balance the nation’s growing renewable energy generation portfolio. Advanced grid architecture that integrates into the bulk power system, customer-owned distributed energy resources, smart metering systems and storage technology such as battery storage and power to gas technologies will be needed.

Public support needs to be built, and will require effective media awareness campaigns to explain the benefits of EOT. As EVs gain parity with internal combustion vehicles, EOT should be presented as offering consumers new mobility choices with lower lifetime costs and environmental benefits. There’s a particular need to emphasize the benefits of EOT for non-adopters – consumers who choose for whatever reason not to buy electric vehicles. Showing how all customers can benefit through lower bills when utility-fixed costs for generation, transmission and distribution are spread across more kilowatt-hours needed for EOT optimization can be a persuasive message.

As with many challenges that lie at the intersection of government and business, forming a task force to make recommendations on EOT policy, regulation, finance and messaging is a good idea. The core of such a task force should be drawn from utilities, automakers, regulatory authorities and other state and local government stakeholders, EOT ecosystem trade allies, and not-for-profit public interest advocates. Involvement should be geographically diverse with the aim of getting broad-based buy-in.

A good place to start is with lessons from states that have established reputations as early adopters. Among these are: Hawaii, Maryland, California, Illinois, Ohio, Minnesota and Washington. The latter has created a $10 million fund to make matching grants to local governments or public and private electrical utilities for piloting approaches to EOT.

At more than $1.4 trillion, transportation ranks only behind health care, housing and food as a major sector contributing to U.S. gross domestic product. It will take years before the full benefits of EOT will be realized, and there’s a lot of unpredictability ahead. Those that get early starts in addressing the issues will best position themselves as early beneficiaries of what may be one of history’s greatest economic transformations.

Matt Slavin in 2018 founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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Portland planning and design firm Mackenzie has filed for a pre-application conference with the city of Portland on behalf of a developer looking to convert about 110 acres at the Portland Meadows horse racing facility into an industrial park. According to the pre-app documentation, plans call for a building of between 822,000 and 942,000 square feet with two or three smaller buildings all suited for warehousing, distribution and light manufacturing.

A forward-looking concept would target a clean tech industry park focused on sustainable power and smart grid and interrelated smart water and smart transportation, generating competitive returns with products and services that help reduce or eliminate negative ecological impacts and improve the productive and responsible use of natural resources. Components for and assembly of fuel cells and battery storage for commercial, industrial and home use could be among products designed and made.

Clean tech at Portland Meadows would build on the city’s existing commercial and institutional assets and help meet its sustainable economic development goals.

In terms of assets, Portland is home to the Bonneville Power Administration. Along with the Northwest Power and Conservation Council, also headquartered in Portland, BPA has made substantial strides over the past two decades in encouraging deployment of energy efficient and renewable technologies throughout the Northwest.

With 3,200 megawatts of installed capacity, Oregon ranks 10th nationally among states for wind power, and Portland is home to the North American operations of Vestas – the world’s largest maker of wind turbines. Despite a reputation for cloudy days, Portland ranks 16th among U.S. cities in installed photovoltaic solar.

The city is also home to a number of consulting and business service firms that serve the clean tech energy sector, including ICF, Cadmus and Research Into Action. Three major utilities are headquartered in Portland: Portland General Electric, Pacific Power and Northwest Natural Gas. Reformulated natural gas is a major source of hydrogen for fuel cells.

A clean tech energy park would support a more diverse workforce than a conventional light manufacturing and distribution warehouse scheme by mixing engineers and technicians with lesser skill vocations. It’s not the right model for a clean tech energy park in Portland, but jobs at the plant being built by Taiwan’s iPhone assembler Foxconn in Wisconsin are expected to average $53,000 a year. It’s hard to imagine a conventional warehousing business paying as well.

The park would embrace advanced cleaner production best practices in energy and water efficiency, solid waste and hazardous waste recovery and other site operations. On-site material handling would be performed by automated vehicles. Think self-driving forklifts and pallet stackers using geo-navigation and laser sensors. These vehicles are already on the market.

An advisory board composed of professional and technical experts drawn from local business and academia would not only add value from an operations perspective but prove a useful ally for branding the park and attracting tenants.

Forward-looking leaders have already recognized Portland’s potential for establishing itself as a magnet for clean tech energy with the newly inaugurated graduate certificate in energy policy and management at Portland State University. The program brings together study in engineering, administration, planning and economics. Graduates would provide a local source of professional and technical talent to meet the clean tech energy park’s workforce needs.

There’s little public information available on what Mackenzie is discussing with the city. It could be that the proposal is for establishing clean tech energy on the site. It’s difficult to tell based on limited information, although information available suggests a more prosaic distribution warehouse use.

The question at Portland Meadows is not whether the use will be industrial. It’s whether the property can be repositioned to engage the new economy and further empower Portland’s goals by developing a clean tech energy park that meets two of Prosper Portland’s targeted industry cluster goals in sustainability and manufacturing.

The racetrack property is probably the last large tract of land available for industrial use within city limits. Possibly, and even probably, the developer has an end user in hand, since it’s unusual to permit 800,000 square feet of industrial space on speculation. But if the horse hasn’t yet left the gate, it’s time to take a good look at how Portland can continue to build upon the reputation it has established for forward-looking urban development with a clean tech energy park at Portland Meadows.

Matt Slavin in 2018 founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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The Oregon Legislature has established a task force to make recommendations for regulating operations of autonomous vehicles (AVs) on state roadways. Composed of government, industry and consumer stakeholders, the task force is to report in September on policies and rules that can form the basis for enacting legislation during the 2019 session.

At least 47 states, including Oregon, have enacted or are considering laws, executive orders or other actions to regulate self-driving cars and trucks, according to the task force. It’s a critical move. Public skepticism has been aroused by collisions involving AVs, but McKinsey & Co. analysts and other leading experts continue to see a growing market for AVs accompanied by auto electrification, connectivity and shared mobility as inevitable and disruptive.

There’s a lot of ground for the task force to cover, and it’s divided into committees. Here are some issues they’ll deal with:

First, any laws need to make a distinction between vehicles categorized among three different levels of automation:

• Level 3 conditional automation: automated systems perform all of the aspects of driving, with the expectation that a human driver takes over if necessary
• Level 4 high automation: entirely automated driving within pre-programmed geographic areas
• Level 5 full automation: entirely automated driving anywhere, including non-programmed areas

The risk that Level 3 automation might lull drivers to inattention with collisions resulting has led the industry to want to emphasize bringing Level 4 vehicles to market in the current cycle.

A high-profile issue that will need to be addressed pertains to following distances between trucks operating in a “platoon,” which generally is defined as a group of motor vehicles traveling in a unified manner in the same lane utilizing vehicle-to-vehicle communications technology to coordinate movements.

Like cyclists in the Tour de France, a connected line of trucks faces less air resistance and can accelerate and brake together over closer truck lengths, producing fuel savings that grow as more trucks are platooned over longer distances. A platoon exemption is a priority for the logistics industry and has generally proved non-controversial elsewhere because of savings efficiencies and environmental benefits.

Another big issue is insurance. Exactly how AVs will alter insurance markets remains unclear, but recommendations being prepared by the task force will likely begin to lay the framework for bringing Oregon’s insurance laws into the self-driving-car age.

There’s a general assumption that the safety premium generated by automated systems will reduce collisions, most of which are due to human errors, not technological ones. Currently, liability insurance rates are based upon drivers, but none of the occupants would be driving a vehicle operating completely driverless, which is the mode of operating insurers would assume to cover risk. So AVs create an imperative for insurance companies to shift liability risk from vehicle occupants to the vehicles themselves in some way.

Another consideration: states that enacted AV laws early generally freed or otherwise provided some legal protection to autonomous vehicle makers, because the AV technology was an after-market retrofit and because they wanted to get in the front seat of the AV revolution. Now, with GM and Ford and others having acquired their own automation technologies, state laws are being amended as necessary to address liability attributable to vehicle makers and the computers, algorithms and artificial intelligence used in self-driving vehicles.

Taking the human entirely out of the equation is an important psychological and logistical step before truly driverless cars can hit the road. At this point, Oregon may not go as far as California did earlier this year when it announced elimination of the requirement for AVs to have a person in the driver’s seat to take over in the event of an emergency. New California rules also require licensed companies to be able to operate any Level 5 vehicles remotely. Think a pilot remotely operating a drone aircraft, only terrestrially. These are issues that require a thorough thinking through.

The task force and the Legislature need to keep in mind that Congress has its own ideas about how AVs should be regulated. Vehicle makers, technologists and end users do not want to have to face a mishmash of state rules and regulations, which would trip up the market.

A bill passed by the House of Representatives would pre-empt state AV laws and regulations in favor of federal laws. The bill was on the fast track, but the desire of some very influential senators to better study the issues led the Senate to slow the bill’s progress. Still, a pronounced federal role that likely involves some manner of pre-emption will be needed for AVs to take hold. So some or all of what Oregon comes up with may prove moot at some point.

To follow the task force’s work, google “oregon autonomous vehicle task force.”

Matt Slavin in 2018 founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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The challenges of making decisions in the face of globalization, Big Data, growing stakeholder diversity, and blurred boundaries created by multiple goal complexity is compelling forward-looking organizations to emphasize consensus when making important decisions.

John Keith, co-founder of Portland-based Lucid, which offers consulting and technical services to help organizations optimize meeting effectiveness, contrasts consensus to two other major types of decision-making models. One is command and control, intuitive to most people as a decision making where leaders make top-down decisions without consulting their teams. The other is collaborative decision making, where designated leaders still make the important calls, albeit based upon interlocution with others team members possessing relevant information.

Consensus is a more democratic and dynamic form of decision making. It aims not simply to foster trade-offs and compromise within a group but upon making important decisions within a structure that a whole team can buy into and take ownership of and, optimally, be accountable for throughout implementation.

There’s no shortage of decision support software on the market with features useful to facilitate command and control and collaborative management, including applications that help integrate Big Data and produce predictive analytics, business intelligence and competitive intelligence, mapping, and visualization. But according to research and advisory firm Gartner, software platforms incorporating algorithms dedicated to generating consensus are still in their infancy.

Ideally, an application dedicated to support consensus would integrate the following functions:

• Labelling and visualization for easy understanding by end users not well versed in technology;
• Uniform dissemination of critical information to all group stakeholders;
• Sharing of all stakeholder ideas, perspectives, and priorities;
• Algorithms to establish areas of stakeholder agreement and disagreement
• Predictive modeling of competing and complimentary scenarios;
• Iterative voting, weighing and ranking of proposals among stakeholders;
• Near consensus alternatives when full consensus is not possible;
• Clear and concise reports mapping out decisions, the grounds upon which they are based, and the steps needed to move forward ; and
• Capability for stakeholders to revisit and revise their agreements as necessary during implementation.

This looks like a big ask, but in the age of artificial intelligence, maybe not so much. AI is likely to continue its inexorable march toward replicating the cognitive performance of people. As machines learn more about how humans think and express themselves, they will better be able to parse stakeholder ideas and perspectives and mold these into “shared thought” embodying common interests suited to consensus.

Under any circumstances, there will be limits upon what AI-driven consensus building apps can achieve.�� Most prominently, these applications will only be as reliable as the commitment of involved stakeholders. Optimization will thus depend upon stakeholders who bring the following attributes to the table:

• An ability to embrace a common goal and commitment to collectively achieving a desirable outcome by recognizing that the overall success of the group is preponderant;
• The willingness to engage by sharing opinions, listening to those of others, and remaining open to new ideas or directions; and
• A willingness to follow and adhere to well-defined and transparent processes while avoiding actions that could be interpreted as self-seeking manipulation.

Other factors are likely to pave a path forward for machine-assisted consensus. In addition to business, government – which often looks for consensus when making contentious decisions – looks like a prime market for adoption. For example, earlier this spring the Washington State Legislature let out a request for proposals for a contractor to facilitate consensus making among competing parties for development of recommendations for statewide regulation of car sharing services. Building consensus will be a tough road to hoe, as the stakeholders include Uber, known for vehemently resisting regulation. Maybe automation would help.

Another factor is increasing adoption of “we work” groups – loosely federated groups of people, pulled together in an ad hoc fashion as needed for specific endeavors – in place of static organizational team structures.�� This will attach increased importance to speed and nimbleness in interpreting and articulating the preferences and proclivities of shifting stakeholders as they populate the “we-work” ecosystem, an ideal role for machine learning.

Optimizing software apps for consensus leadership may require reassessment of organizational cultures. To many, the word consensus conjures a time-consuming recipe for “kicking the can down the road.” But this should become less of a concern as automation again promises to speed up the consensus-making process.

In general, command and collaborative leadership is best suited for situations requiring reliability and certainty and where the variables are known, whereas consensus best suits scenarios defined by ill-defined problems with that require creativity and departure from norms. Consensus is unlikely to ever supplant more hierarchal approaches to decision making. But boosted by new apps and AI, it may see much more widespread use.

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While most public attention is focused upon self-driving cars, use of autonomous technologies for interstate trucking seems poised to play a bigger and more immediate role in reordering the nation’s roadways.

With long-haul trucking delivering nearly 70 percent of goods in America, the business case for automated driving technologies is strong. Fuel accounts for about one-third of the cost of operating a long-haul rig, and once on the highway, digitally connected or paired autonomous trucks could be platooned, or operated en masse as convoys at optimized speeds while reducing wind drag to save fuel. Highway driving avoids many of the safety risks posed by autonomous vehicles in city driving, most particularly the risk of collisions with pedestrians.

With the American Trucking Associations reporting a current shortage of about 50,000 drivers and a need for nearly 900,000 new drivers over the coming decade (due in large part to an aging workforce), automating trucks will help. However, as discussed below, this may be seen as a two-edged sword.

Automated 18-wheelers are already being tested on long-haul routes, albeit with human operators behind the wheel ready to take over if needed.

Portland-based Daimler Trucks North America (DTNA) makes Freightliner tractors, the top branded Class 8 tractors in the U.S. with 37 percent of the market, according to statistics website Statista. Later this year, one of Freightliner’s top customers will begin testing trucks outfitted with automated systems proprietary to Daimler’s Detroit Assurance brand in day-to-day operational settings on public roads.

In February, an autonomous Class 8 tractor operated by San Francisco-based Embark completed a 2,400-mile, five-day run between L.A. and Jacksonville, Fla. In March, Uber Freight began using automated trucks to make deliveries in Arizona.

To manage situational awareness, automated vehicles utilize drive-by-wire networking of radars, cameras and ultrasonic or laser sensors to operate electromechanical actuators mounted on steering, throttling and braking mechanisms.

Retrofit of a tractor with a system developed by Otto, acquired by Uber’s Advanced Technology Group in August 2016, is said to have cost about $100,000. But analysts say the goal is to get Class 8 truck automated systems down to a $20,000-$30,000 retrofit price point, compared to as much as $150,000 to purchase a fully fitted-out tractor today.

Prices have dropped for Lidar, the pulsed laser light detection and ranging technology that has been the most expensive self-driving vehicle component. Luminar recently announced it will sell a version for about $250 per unit once mass production begins later this year.

Derek Rotz, director of advanced engineering at DTNA points to many technical, legal and societal challenges that need to be resolved. Overriding all else is the need to ensure safety. The most likely scenario is that autonomous vehicles will be deployed through a series of step-by-step building blocks that see incremental adoption of automated technologies over time.

Government regulation is a prime consideration. State regulation of automated trucking will need to be harmonized. But analysts believe that as automated systems increasingly prove themselves, regulators will mandate that manufacturers integrate such systems into their vehicles.

How the population as a whole comes to see autonomously operated trucks is likewise a central concern. The efficiencies enabled by autonomous technologies can free up driver time to perform logistical tasks, from scheduling to routing. But the greatest efficiencies will be found in vehicles that can operate driverless over long stretches of highway.

Looking forward, the model would call for human operators to drive autonomous rigs through city streets and congested intra-urban highways to transfer hubs where a number of rigs would be assembled into platoons. Once highway bound, platoons would be remotely overseen by operators at central facilities in a manner not dissimilar to how operators pilot military drones, except that the rig operators would oversee a platoon of trucks as opposed to a single drone.

As far as the two-edged sword, the big concern is job loss. A December 2017 report by McKinsey Global Institute projected that close to 1.5 million jobs could be displaced by automation in the trucking industry over the coming decade. Not all projections are so dire. “Creative destruction” scenarios modeled by Uber ATG portray efficiencies created by a system with humans driving the last mile of automated truck routes as potentially creating more jobs due to growth in truck freighting and more affordable consumer goods.

It’s a big step from Level 3 automated vehicles (driver must be ready to take over at any time) to Level 4 (still has a steering wheel but vehicle can operate autonomously under pre-programmed scenarios and conditions) to Level 5 (full autonomy on any road under any drivable conditions; no steering wheel needed).

Declining to make any predictions as to when, DTNA’s Rotz believes that the road to seeing fully automated Level 5 trucks on the nation’s highways will be a long one.

It will likely take years to capture the full potential of autonomous long-haul trucking. But it’s clear is that automated trucks are here to stay, and you’ll be seeing more and more of these vehicles on the roads.

Matt Slavin in 2018 founded M.I. Slavin to provide consulting in project management, strategic planning, research and communications. Contact him at 503-619-5601 or matt@mislavin.com.

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