Why Read: The future demands a new approach to electricity generation and distribution. Internet protocol and distributed generation software offers a path forward. - bba

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It's not just you. The world and its systems are growing less stable - the international world order, the climate emergency, the economy, supply chains and access to global goods, drought and famine, the rate of technological change and its social and cultural disruptors, spiking inequality and political polarization, and, around the world, civil unrest. 

Bill Frist, chair of the Nature Conservancy, authored a piece in Forbes last week on the cascading and complex nature of formerly rare disasters.

Today, these disasters increasingly arrive as compound events. They unfold as interconnected systems of risk, with physical damage escalating into supply chain disruptions, business interruption, ecosystem loss, and humanitarian emergencies. A hurricane during a heat wave that knocks out a power grid is not three separate events. It is one correlated risk cluster. These cascading risks are exactly what climate change accelerates and what actuaries and insurers are struggling to price.

Insurers aren't the only ones struggling to adapt to this new norm of interconnected and cascading risk. 

The most famed speech out of Davos last week was that of Canadian Prime Minister Mark Carney, who put words to that feeling from the perspective of what he called the "middle powers" - a term he used to mean countries that are not the US, China, or Russia. Said Carney: 

The multilateral institutions on which the middle powers have relied - the WTO, the UN, the COP - the architecture, the very architecture of collective problem solving, are under threat. And as a result, many countries are drawing the same conclusions that they must develop greater strategic autonomy, in energy, food, critical minerals, in finance and supply chains.

Carney's overall comments took aim at Donald Trump and the US's international aggression, but his words apply to critical infrastructure here in the United States just as much as they do to the rest of the world. 

Globally, we have arrived at the Age of Polycrisis. Our success navigating the world ahead will depend on our ability to build systems that are redundant, resilient, and decentralized.

The design constraints have changed. It's time we adapt our responses accordingly. 

The Fragility of the Grid

One of the most fragile - and most fretted about - architectures today is the grid, which is still somehow functional despite being fundamentally unchanged since its initial analog invention in 1882. 

As David Roberts, host of the "Volts" podcast, remarked in an interview last week with Swedish tech entrepreneur Jonas Birgersson:

[T]oday's grid, absent batteries, absent the ability to store energy, which has been most of the grid's history, demand and supply have to sync up in real time. You produce the power, it has to be consumed instantly, more or less, which is an enormous and truly mind-boggling coordination problem. It's amazing it works at all.

Looking ahead, as climate and geopolitical instability intensify, that real-time need to balance supply and demand will continue to accelerate and lengthen outages. 

The factors contributing to the grid's fragility are numerous: