Issue Date: July 8, 2001

Power Play

Yes, the ominous scenes described here take place on a very specific stage: blackout-plagued California. Yet it's quite possible they're merely the opening acts of a drama coming soon to an energy plant near you.

By Dennis McCafferty

Above: Larry Bellnap monitors his state's mounting energy crisis daily at the command center of California's electrical grid. Below, Peter Kirwan, in brown, and Todd Ridgway, execs at the Web-hosting company NaviSite, generate their own power when blackouts hit.

THE SERVER FARM breathes energy. It is a two-story plant, nearly as wide as a soccer field, in the heart of Silicon Valley. In generations past, such a plant would have turned molten steel into skyscraper girders or battleships. But today the precious commodity is digital information. Unlike steel, digital information is literally weightless. But to produce the commodity with ever-increasing speed and volume, the server farm craves energy in doses previously inconceivable. This plant is packed from subfloor to ceiling with routers, switchers and servers. It contains miles and miles of twisting, high-powered cable lines as taut as wisteria vines. The wattage needs are so intense that the server farm requires up to 12 times as much electricity as a typical office building.

And there are 120 of these enterprises in Silicon Valley. With a debilitating energy crisis disrupting Californians for the past year and threatening to worsen throughout the summer, the server farms epitomize 21st-century mass consumption.

This particular one, called NaviSite, provides "Web hosting," a service that stores everything that exists online -- and assures its clients that business will keep humming 24/7. In a tightly secured, mission control-styled wing, young people in cutoffs and T-shirts huddle in front of blinking screens so large they look like they belong in Times Square. The screens track the billions of bytes that shape the information stored in the hundreds of 7-foot-high cabinets warehoused at NaviSite: e-auctions, family photos, fashion catalogues and a Web-broadcasted Jennifer Lopez concert. The workplace is lively, vibrant with adrenaline and ideas as Nine Inch Nails tunes blast from desktop PCs. "I liken us to a technology SWAT team," says Todd Ridgway, a senior NaviSite executive. "The best money can buy. That's what we like to be." Says Peter Kirwan, another senior executive: "We're built for California, including all the disasters that can happen here."

The disaster du jour, of course, is this bear of an energy crisis.

A series of rolling blackouts has resulted in harried scenes statewide. Elevators stall. Car horns blare as traffic lights go out at busy intersections. Hotel guests use fluorescent sticks to guide themselves back to their rooms.

"Only in California ..."? While it's tempting to dismiss the crisis with that familiar refrain, these woes may foreshadow circumstances the rest of the nation will soon confront. For now, experts say New England and New York City may meet with summer shortages. In the warmth of the California sun, rolling blackouts in that state could dwarf those suffered last winter.

Across the country, electricity supply has not kept up with demand. America used to have plenty of power, with utilities generating more than enough from 1978 to the early 1990s. But, since then, demand for power has far outpaced forecasts, while the capacity to produce power has failed to keep up. Also, the utilities' "reserve margin" -- that needed to handle emergency demand, such as in heat waves -- has sharply declined.

Like many others in the technology industry, the executives at NaviSite recognize the severity of the crisis. NaviSite has taken steps to limit electrical use, such as clustering workers in tighter spaces so lights can be turned off in unoccupied areas. There is a sense of the inherent value of conservation. Kirwan, for example, was so affected by the energy crisis of the early 1970s that, as a boy, he built his own solar-powered cooker, on which he grilled hot dogs.

But Kirwan and Ridgway realize their industry represents a watershed level of energy inhalation, one that couldn't be imagined even five years ago.

As with any major crisis, policy players have offered contrasting viewpoints. President Bush calls for more utility generators. Conservationists call for more solar panels and other energy-saving measures. Then there's a long-overlooked need, one that addresses the vital conduit that delivers energy: a major overhaul of the nation's weathered transmission lines.

These lines serve as roads for the power supply. But they remain pretty much as they were decades ago, with no upgrades to help them deal with today's overwhelming demands. It's akin to building office parks and mega-malls along a two-lane country highway and expecting the road to bear the increased traffic without wear. "The problem has been building up for years," says David Owens, executive vice president of business operations for the Edison Electric Institute, a trade group based in Washington, D.C. "It's unfortunate that the California situation had to happen to bring it before the public. But we have a system that's full of potholes, and we need to fix it."

SOME 90 MILES NORTH of Silicon Valley, a collection of players grapples for answers. If the valley is the San Andreas Fault of consumption, these are the people who keep it from falling apart. This is where California's Independent System Operator -- known as the ISO -- oversees the state's electrical grid.

The ISO staffers scout out seismic collapses in the utility flow. To watch them work is like being in the cerebral cortex of the Pentagon. A large red- and green-lighted board lays out the labyrinthine road atlas that is the supply path. Elsewhere, computer screens often provide a dismal commentary on how much energy is available. The ISO crew remains unrattled, although it often seems they're trying to plug dozens of holes in a dike with one set of fingers.

Shift manager Larry Bellnap is in short sleeves, his flattop haircut underscoring his back-to-basics approach. The ISO keeps track of how much supply is coming and negotiates, or downright pleads, for more from the 200 electricity generator outfits. Then the ISO delivers news throughout the day to large regional utilities and lets them know how much they will get and whether it will be enough. If it's not, that's when the blackouts kick in.

On this day, Bellnap slumps in his chair as Greg Van Pelt, who oversees outage coordination, delivers a pessimistic report. In the San Francisco area, there's a generator with a boiler leak; water is spritzing everywhere. It has to come offline, which will leave the ISO employees scrambling for a backup. In front of one computer screen, a worker digs into a jumbo bag of Doritos and works the phones. "C'mon," he says. "Whatcha got for me today?"

What went wrong? Like other regions of the country, California struggles with supply and transmission line problems. The state, however, also has suffered from its controversial deregulation movement of the late '90s. The large utility companies turned over their power generators to private enterprises. The idea was to allow the utilities to buy back affordable electricity for the customer in a competitive market. But critics say the power-generating companies inflated prices, passing off that cost to the utilities.

The resulting crisis plays out daily before Bellnap's eyes, in the form of blinking lights and blips at the ISO's grid map and computer screens. But once Bellnap steps outside his workplace, he has day-to-day encounters with the human element behind the grid.

Early this year, as blackouts unfolded, he accompanied his wife to a business conference in San Diego. The staff at his upscale hotel warned him that, should the power go out, he'd have to ask the front desk to let him into his room: His magnetic key card would be useless. While his wife attended her conference, Bellnap killed time at a sports bar eating chicken wings as a dozen big-screen TVs flashed news warnings of the coming blackouts.

On the plane home, Bellnap struck up a conversation with a well-dressed woman across the aisle. She provided an earful about the crisis. "I can't see why they'd shut me off," she said. "I pay $600 a month for electricity."

"Do you have a pool?" Bellnap asked.

"Yes," the woman replied.

"Do you run the filter system motor all the time," he asked, "even when it's off-peak hours?"

"How should I know?"

"Do you keep the house running at 70 degrees even when you're away?"

"Probably. I never thought about it, really."

"Ma'am," Bellnap said, "do you know the reason you're being shut off from power? You use so much of it. There's not enough of it to go around ..."

Could it boil down to that? For months now, the energy debate has been dominated by finger-pointing at short-sighted politicians and corporate greed. It's a "round up the usual suspects" approach that appeases irate consumers dealing with soaring utility bills. But the consumers, while hardly malevolent, are not blameless. For years, they took part in a pattern of excess based on the impression that energy was and always would be around.

Today, the crisis brings them face to face with the consequences of their behavior. Hence Bellnap sits in front of the grid, watching the blips. The crisis has changed his perspective for good. But, on his shift, his goal is to make sure California gets through another day. "Well, anyway," Bellnap says, recalling his plane conversation, "I don't know if I changed her lifestyle. But I like to think she was a bit more enlightened."

Enlightenment is taking hold in various ways and by various means, even amid the fast-forward motion in Silicon Valley. Sometimes it seems there isn't a moment to step away, not with the magnitude of scale the information plants work with. The server farms use 60 watts per square foot of space and are built to handle 100 watts. A regular building -- say, an insurance company -- uses 5 watts. And those Old Economy buildings often shut down at 5 p.m. Not the server farms. The New Economy doesn't sleep. It's always running full steam ahead, to keep up with the pace of the competition.

NaviSite's Ridgway and Kirwan have spent their careers in a similar vein, sprinting forward with a potent brew of energy and ideas. Ridgway, 36, once an aspiring musician, saw how technology could spark new life into his passion. By his mid-20s, he was collaborating with blues star B.B. King on a CD-ROM autobiography. Kirwan, 37, had launched five companies by age 34. He developed an innovative browser and ran a Web-hosting business out of a Manhattan loft. During the 20-hour days he spent building his company, Kirwan's internal reserves melted down as he took the subway home. He would fall asleep standing up, holding the handrail.

Now, the creative journey has landed both men at NaviSite. Ridgway is a senior systems engineer. Kirwan is vice president of strategy. They realize they are modern pioneers. If their brainstorms about information require perpetual energy, it is because their universe hungers round the clock for the Next Big Thing.

And unlike the steel factories, the information plants don't simply command staggering quantities of power. They also serve as enablers for that consumption, cultivating a relentless need for energy by the masses who depend on the information. We go online for road directions when we once consulted maps, for proper spellings when we once reached for a dictionary and for greeting cards when we once sent our sentiments in the mail. The ultimate contribution of the information plants isn't empowerment, global connectivity or creating world peace. What the plants have given us is the one thing that has been deemed essential today: convenience.

Then along comes this energy crisis. The ultimate inconvenience.

Which has led these two men to introspection.

And possible disconnect.

What bothers them most these days is the noise. The blinking e-mail alerts, the incessantly chirping cell phones and the endless traffic -- the Digital Economy is all about traffic, and the volume is always up. "A lot of times," Kirwan says, "I want to separate from it all."

Ridgway recalls playing bass in a band in a Santa Barbara bar eight years ago when the lights went out. No amps. No microphones. But the band kept playing. "It was the coolest thing I ever heard. People suddenly stopped and paid attention, because it was the only sound in the place."

The debate about the energy crisis also is about noise. Noise about rolling blackouts and soaring bills and picking villains and heroes. But to these two men, the crisis is about something more. It is about the price of their own success.

"We went out West, and they advertise cars and SUVs as if they will give you freedom to move," Ridgway says. "But what kind of freedom is it if you're stuck in traffic with 2,500 other cars on a highway? You're going nowhere. It's the same with this technology power. We've convinced ourselves that we need to keep going better and faster to have the freedom to do more."

He's tired of sprinting to stay in place. Tired of needing the Next Big Thing just to get by. "At this point, I don't have the ego or the time to need the latest and greatest. You simply don't have to have it."

Kirwan agrees. Within weeks, he'll head to Mexico, breaking away from e-commerce, e-mail, e-everything. He chuckles and shares his latest entrepreneurial fantasy: selling cabinets. Not the ones that store data at NaviSite. "Wooden cabinets," he says.

"That sounds good," Ridgway says, laughing. "Why have a Palm Pilot when you can have a good wooden desk? The need for all of this connectivity is in our heads. You can shut it off ..."

California breathes energy. That's the dilemma, but it's also the resource. It's the human energy that relentlessly seeks answers when the picture seems to fade to black. A chance meeting between strangers on a plane leads to a dialogue. Two Silicon Valley players find they may do more with less. An outage can't dim self-examination. There will always be a flicker of light.

Story photos by Gerry Gropp for USA WEEKEND