The Military: Winning Hearts and Minds

The military is setting an example as an unequivocal supporter of technologies and strategies that address energy, water and transportation efficiencies.

In doing so, it is providing an exemplar for corporations and individuals who, because of their existing values or political ideologies, might not otherwise believe in the urgent need for such policies.

For examples of current Military projects, please see "The Modern Military"

This is not unfamiliar territory for many in the Fortune 1,000, leaders setting goals for carbon and energy reduction, policies to reduce or reuse water, and controls to manage the costs of transportation. For these companies, such strategies are not a matter of principle or conviction, but one of hard financial realities. For the military, the mission to enhance efficiencies is not just a fiscal decision, but one of lives. Without new technologies, The Department of Defense 's (DoD) mission to protect us at home and abroad has a price in soldier’s safety and health that we must not pay.

The military has been a global competitor the mid 1900ds. The Department of Defense (DoD) has multiple roles as war fighter, defender of national security, the nation’s largest landlord, and as a manager of vast landholdings, covering over 2 billion square feet of building. By supporting the development of new technologies, that have ultimately spilled over into civilian use, the military is an economic and societal influencer, helping to develop and deploy new systems that are now in everyday use. Examples include the GPS (Global Positioning System) in use by our phones and map applications, the internet which has changed the way we do business and engage with our friends and family, the cathode ray tube that became television, radar, microwaves and much more. These innovations are brought about through partnerships with the private sector that ultimately have a profound effect on the direction of our economy.

The notion that public funds should be used to support the military has been a motivator since our conception as a nation. National security, like clean air or water, is a benefit for all, but one that individuals and corporations want to be provided by a utility or government entity. In the US, labeling a project national security greatly improves the chances of funding by Congress. As an example, the term ‘military’ was essential to receiving federal funding for building roads during the war of 1812. In 1956, President Dwight D. Eisenhower followed on this tradition by signing the National Interstate and Defense Highways Act, creating our Interstate Highways System, because he saw a national security need for fast, reliable transportation to move goods and materiel to where it is needed. 

Today, the military is again leading, developing new ways to address the challenges of energy, water and transportation. Sarah E. Light, Assistant Professor of Legal Studies and Business Ethics at the Wharton School of Business, University of Pennsylvania, in her seminal paper, published by the UCLA Law Review, Valuing National Security: Climate Change, the Military, and Society, describes the new public private partnerships as the Military-Environmental Complex, in homage to President Eisenhower’s characterization of the ‘Military-Industrial Complex’: 

“The Military-Environmental Complex is the military’s extensive undertaking to improve its sustainable energy use and reduce demand for conventional energy resources both on the battlefield and in permanent installations, in which the DoD’s interests are intertwined with those of members of Congress, the President, and the private sector. In the Military-Environmental Complex, multiple forces drive the military, including Congressional mandates, Presidential executive orders, the private sector’s desire for a high-volume customer for existing technology, and the private sector’s need for funding to develop new technology.”

She goes on to say that the prime mission of the military is to provide forces needed to deter war and protect the security of our country is impacted by the costs, transportation needs and inefficiencies in energy distribution and procurement.

The military has institutional and operational facilities, both with large footprints. Institutional facilities, such as schools and administrative offices, may be included under the host country’s environmental or other regulations. However, operational facilities are a world unto themselves. Some are mini-cities. LSA Anaconda in Iraq included a movie theater; fast food courts with Popeyes, Pizza Hut, and Taco Bell; a Turkish Cafe with Turkish food prepared by Turks; an Iraqi Bazaar for local souvenirs; multiple gyms, dance lessons, and an Olympic size swimming pool; along with the problems of cities for sanitation, food, energy and, increasingly, cooling. 

The costs of fueling such operations can be counted in lives, because transport vehicles carrying supplies are vulnerable to IEDs (Improvised Explosive Device) and other attacks. Aerial transportation can add two to 20 times the pump price, and estimates run as high as $400 a gallon when delivered to a forward area, according to a Pew Report. Ms. Light adds that reducing energy use acts as a ‘force multiplier’ — missions can go farther without refueling, running generators, or bringing fuel convoys to the battlefield. She goes on to say that Army logisticians estimate that about 50% of the load carried by supply is fuel, and 20% is drinking water. In another example, the Army estimates that the Desert Storm buildup would have taken 20% less time if the Abrams tank were 50% more fuel efficient."

Another factor forcing the military to engage with the private sector to test and deploy new technologies is the energy intensive devices that soldiers carry, including phones, radar, GPS, as well as the batteries to fuel them. Add to that canteens, rucksacks and other equipment, these packs can range up to a hundred pounds. For some, the can amount to half their weight in an environment where average temperatures are over 100 degrees Fahrenheit. That and the need for innovative off-site tents with cooling are creating a demand for innovation.

However, these human and financial costs are often not included in military, corporate or government budgets: they are real but invisible expenses. One thing changing that for the military is recent congressional mandates, which are demanding the actual cost of energy, known as the ‘Fully Burdened Cost of Fuels’, as well as better approaches to the split incentives that put the costs on one balance sheet, while the benefits accrue to another. 

Fully Burdened Cost of Fuels

The fully burdened cost of fuel is a new metric defined as “the commodity price for fuel plus the total cost of all personnel and assets required to move and, when necessary, protect the fuel from the point at which the fuel is received from the commercial supplier to the point of use.” This metric is in line with recent congressional mandates that are incenting the military to revise its approach to energy. According to Ms. Light:

“In this sphere, Congress has directed the Secretary of Defense to develop ‘energy performance goals’ and an Energy Performance Master Plan… In developing such goals and a plan, the Secretary is required to rely on certain ‘special considerations’, including opportunities to reduce current and future energy consumption, to implement conservation and efficiency measures, to develop alternative energy sources, to reduce costs, to benefit from economies of scale, and the ‘value of the use of renewable energy sources.’”

Split Incentive

The Defense Science Board  has suggested that a ‘split incentive’ exists because commanders who actually use technologies in the field are not required to account for fuel consumption, and commanders who reduce energy costs might have their budgets cut in the following year. Such split incentives affect the potential for investment in new equipment, as those paying for upgrades are not rewarded. In the commercial sector, facilities managers tasked with energy improvements have little sway over energy demanding departments, such as data centers, that do not pay their energy bill. Commercial tenants benefit from the energy savings that building owners are supposed to pay for. Such split incentives are creating a demand for new approaches, such as transactions that allow a landlord to benefit from energy savings by sharing income with renewable energy or energy efficiency developers, or energy and water data provided to departments so that they can set annual reduction targets. 

There are two primary ways that the military works with the private sector: Power Purchase Agreements (PPA), and Requests for Proposals (RFP). 

PPA

Under a PPA, DoD purchases the energy and provides the land, but private firms finance, build, and own the generating equipment. This long-term authorization, which can last up to 30 years, provides incentives for private financiers to invest in projects where high initial capital costs can only be recouped if they are amortized over a sufficiently long time-horizon. PPAs have long been used by utilities and others to procure generation to meet their energy needs. Such PPAs have been invaluable to developers who ‘lease’ rooftops for renewable energy or floor space for energy efficiency equipment.

RFP

The Army requests proposals for many things, including thirty-year solar, wind, geothermal and biomass generation. According to Ms. Light, in 2013, projects included a battery energy storage system, a microgrid control system, a data-center liquid-cooling system, high-concentration photovoltaics, a waste gasification system, technology that can reduce air-conditioner energy use through measuring operational energy efficiency, and a roof asset management system.

Ms. Light notes that:

“[I]ndividuals are psychologically disposed to believe that behavior they (and their peers) find honorable is socially beneficial and behavior they find base socially detrimental.”

This is an important insight, because our contentious political and media environment has tended to brand the ‘other’ side as in some way morally deficient. By setting an example that is fueled by necessity not belief, the military is developing and supporting ways to introduce new technologies into the field on a scale that is unlikely without such support.

As a very large organization, their approaches are an exemplar for corporations that are grappling with rising costs of energy, the potential threat of water shortages and regulations, and inefficient transportation that wastes time and resources. 

At home, they are winning the most important hearts and minds: we the people.

 

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