By Jake Reeder, MBA/MPP ’15
This article was written in response to a seminar given by Rob Latoff, Director and Senior Partner with McKinsey & Company, in an EDGE Seminar on Sept. 25, 2013 at Duke University’s Fuqua School of Business.
Rob Latoff’s perspective on energy economics in the EDGE Seminar was refreshing in its lack of certainty about the U.S. and global energy sectors. During his talk, Latoff didn’t attempt to, as he put it, “develop the most perfect crystal ball.” That said, several predictions about the direction the energy sector might take over the coming decades emerged naturally from between the lines (or slides), of his talk. Below, I’ve tried to list what I think are the most interesting ones from the utility and electricity space.
1. Technologies will emerge to protect consumers and companies from electricity price volatility. Perhaps the most startling point that Latoff made during his entire talk was about bulk electricity pricing. According to Latoff, electricity prices can rise or fall 10- to 100-fold over the course of a normal day (and he has seen prices vary as much as 1,000-fold within a 24-hour period). It doesn’t take a perfect crystal ball to see that this situation is untenable. As utilities use time-of-use charges and other mechanisms to pass on these costs to their customers, the market will respond by developing products and services to alleviate wild price swings. These might be technology-based (energy storage technologies), service-based (demand management), or end consumer-based (distributed generation and smart devices that, for example, dry clothes at low-demand times). What is clear is that 10- to 100-fold price swings within a developed commodity market cannot remain the norm forever. Continue reading
By David Rokeach, MBA ’15
This article was written in response to a seminar given by John McNabb, Vice Chairman of Investment Banking with Duff & Phelps Corporation, in an EDGE Seminar on Sept. 18, 2013 at Duke University’s Fuqua School of Business.
In 1973, President Richard Nixon announced “Project Independence,” an effort to make the United States energy independent by 1980. Nixon defined his objective as “not [having] to rely on any source of energy beyond our own.” Four decades later, this dream hasn’t yet come to pass. It never will.
John McNabb spoke at Duke University’s EDGE Seminar Series on Sept. 18, 2013. He is a seasoned oil and gas executive and is currently the Chairman of Willbros Group, an international energy construction and engineering company. Mr. McNabb spoke about the extraordinary growth and potential of American oil and gas production. Increasing production, he argued, would lead to energy independence. Continue reading
By Malcom Riley, Sector Director: Energy & Technology, Career Management Center, Fuqua School of Business
The energy industry is in the midst of unprecedented transformation and growth worldwide. Mature markets are aggressively pursuing solutions that will reduce their foreign oil dependency as well as their environmental impact. Developing nations are focused on cultivating the natural resources necessary for growth. Energy companies in every segment are competing relentlessly to make key acquisitions, enter untapped markets, and negotiate the game changing deals needed for long-term success. The energy industry’s business challenges are growing more complex each day, and this reality presents a unique opportunity for talented MBAs.
Although MBA recruiting represents a very small piece of the recruiting puzzle for most energy companies, hiring is projected to increase in the near future. In fact, according to a recent survey of 935 corporate recruiters in 50 countries conducted by GMAC, the energy sector will demonstrate a demand for MBA talent as great as any industry. Continue reading
A diverse work background, a systems thinking mindset, and the ability to lead change are a few of the traits that employers are looking for in sustainability hires. EDGE managing director Katie Kross and alumnus Koji Kitazume (MEM/MBA ’12) interviewed 10 diverse sustainability employers this summer to understand what skills make a sustainability candidate stand out.
Read full article on TriplePundit: 5 Traits Essential for Sustainability Leadership.
Fuqua School of Business has already earned a reputation as one of the best places for MBAs to gain industry expertise in energy and environmental sectors. In July, Fuqua extended its offerings with the approval of a new MBA Concentration in Energy Finance. The new concentration, which is an addition to the school’s existing MBA Concentration in Energy & Environment, will give MBAs a chance to dive deeper on issues of project finance, markets and trading, corporate finance, and risk management, with a grounding in the specifics of global energy markets.
“With the addition of this new concentration, we are responding to the growing interest of our students in careers at the nexus of energy and finance,” said Jennifer Francis, Fuqua’s Senior Associate Senior Associate Dean for Programs. Fuqua is the only MBA program in the Businessweek Top 10 to offer a major or concentration in Energy Finance to its MBAs.
The new focus on energy finance follows Duke’s announcement in June of a $5.5 million gift to the Duke University Energy Initiative, which will, among other priorities, provide funding for a new energy finance professorship of the practice at Fuqua.
by Dan Chow, MEM/MBA ’15
Dan Chow is a Duke graduate student pursuing dual Master’s degrees in Environmental Management and Business Administration. In this column, Dan shares his experiences pursuing environment-related entrepreneurial ventures at Duke.
Dan Chow (pictured) and his teammates pitched their Refrackt business plan in the Duke Start-Up Challenge, Apr. 11, 2013
I first became interested in energy entrepreneurship while working on a geothermal-based start-up as an undergraduate at Middlebury College. When I arrived at Duke to pursue my graduate studies, I first attempted to repackage the idea of using old oil and gas infrastructure for geothermal power, and recruited a team to participate in the Program for Entrepreneurs (P4E) at The Fuqua School of Business. While that idea fell through after several conversations, I was still keen to gain additional entrepreneurial experience.
Through a serendipitous meeting, I teamed up with Judy Winglee, a PhD student at the Pratt School of Engineering, Mark Panny (MEM-WRM), and Victor Smith (MEM-EE) to compete in the Duke Start-Up Challenge (DSC), a Duke-wide competition for new business ideas across a broad spectrum of industries. Our proposed venture, Refrackt, built on Judy’s research to tackle water consumption and wastewater production in the hydraulic fracturing industry. Continue reading
This op-ed first appeared in the Raleigh News & Observer on May 21, 2013.
by Daniel Vermeer
Earlier this month, a remote monitoring system in Hawaii recorded the first time in human history that the daily average for carbon dioxide levels in the atmosphere hit over 400 parts per million.
Crossing the 400 ppm line is not inherently meaningful, other than reminding us that we are on a path to a place we don’t want to go. But it can be an opportunity to step back and reflect on the virtues of a stable climate and the stake we all have in that stability. Continue reading
by: Nancy Fechnay, MEM/MBA ’14; Aaron Gress MBA ’14; Lisa Huber, MEM/MBA ’14, and Mark McDonald, MBA ’14
There is no substitute for the real world as a learning laboratory. For the second consecutive year, Duke’s Center for Energy, Development, and the Global Environment (EDGE) partnered with ’05 Fuqua alumnus Paul Straub of Claremont Creek Ventures (CCV) to provide Fuqua students with a unique mentored study opportunity to work in the cleantech venture industry. The focus of the project was to investigate the microgrid market, and to propose a growth strategy for one of Claremont Creek’s startup portfolio companies. This company, called Blue Pillar, offers an IT solution to help clients manage their critical distributed energy assets. The Fuqua team of Nancy Fechnay, Mark McDonald, Lisa Huber, and Aaron Gress assessed Blue Pillar’s current offering and provided recommendations on other industry verticals where their product may meet an urgent customer need.
Straub, employing Steve Blank’s Lean Launchpad mantra, encouraged the team to “get out of the building” to test its hypothesis about attractive industry verticals. The team took his advice by traveling to CCV’s headquarters to meet with the venture firm’s partners, and then connecting with Blue Pillar’s entrepreneurs, current clients, and industry experts. These experiences were instrumental in understanding CCV’s vision, comprehending Blue Pillar’s value proposition, gathering and assessing client feedback, and ultimately providing a rigorous recommendation for Blue Pillar. Continue reading
EDGE is pleased to welcome the return of Katie Kross as Managing Director.
Katie has spent the last year and a half away from Duke, helping to launch a regional nonprofit organization, the North Carolina Sustainability Center. She returned to EDGE this week, and will work in partnership with Executive Director Dan Vermeer to lead the development and execution of center strategy, manage relationships with EDGE’s advisory board and key stakeholders, implement programs, and oversee the Center’s operations.
Katie has 12 years of experience in academic administration and management. Besides her previous tenure at Duke, she has also served as the executive director of the Center for Sustainable Enterprise at UNC’s Kenan-Flagler Business School, and has consulted at business schools including Kellogg, MIT-Sloan, and Yale School of Management. She holds an MBA from UNC and a BA from Davidson College.
by Daniel Chow, MEM Class of 2014
At Duke, students are taught why companies across all industries are pursuing sustainability, what barriers exist for different businesses, and what tools are necessary for organizations to achieve their goals. Kristina Ronneberg (MEM ’14) explained a useful framework that she learned in Professor Dan Vermeer’s Sustainable Business Strategy class, which focuses on three key aspects: Expansion, Translation, and Embedding.
Expansion, Translation, and Embedding
“First, you need for a company to think about how it fits into the greater system, what its impacts are as a whole. That is the expansion piece, or looking outwards. Next, you need to identify where you can reduce the environmental and social impacts, whether that is through changing your supply chain or reducing your inputs. Once you identify actionable items, you often have to translate them into a value proposition that your audience understands. This might mean cost savings if you are talking to a manufacturing plant manager or employee recruitment and retention for human resources. Lastly, you need to embed sustainable thinking and practices into the organization. There needs to be a push for a coherent structure that aligns the corporate values with the goal of minimizing environmental and social impacts. That might be through training, incentives, or any number of other initiatives.”
While this framework provides helpful guidance for how businesses can integrate sustainability into their practices, each company’s strategy must be tailored to their individual needs and motivations. Continue reading