He had set up a research laboratory in Menlo Park, New Jersey, with the ambitious aim, as he put it, of making an invention factory that would deliver “a minor invention every ten days and a big thing every six months or so.”4
His aim was not just to invent a better lightbulb (there had already been 20 or so of one kind or another) but to introduce an entire system of lighting—and to do so on a commercial basis, and as quickly as possible.5
Because of its low voltage, Edison’s direct current electricity could not travel very far.
Electricity’s ascendancy was on display at the Chicago World’s Fair of 1893, which was so popular that the numbers attending it over six months were equivalent to more than a third of the entire population of the United States. The throngs were amazed by the demonstrations of all the versatile things electricity could do.
This made possible a new business model: instead of paying by the bulb, people could pay by their usage, along with an additional charge covering the capital invested in the project.
The meter, imported by Insull to Chicago, would become the interface, the middleman so to speak, between the generating company and the customer. Electricity could be priced by consumption, not by the number of bulbs.
It goes back to what John Maynard Keynes called the “academic scribblers”—those who come to influence subsequent politicians and lawmakers and “practical men” in general—none of whom have any idea that they are channeling thinkers they had never heard of in the first place.
It is the “three Denchi brothers”—or San Denchi Kyodai, as Takayuki Ueda, a vice minister at METI, called them. In Japan, fuel cells, solar cells, and batteries are
most of the digital lessons learned at home.” Energy has much longer lead times; it needs much more capital than the typical IT or software start-up, and then requires several subsequent rounds of big capital injections, and its scale is much bigger. Projects may have to cope with unanticipated delays and substantial cost increases. And then the products have to be sold to industries that are often very cautious about new technologies because of the costs and risks of something going wrong in a complex production system. Moreover, energy-production facilities tend to have long lives. Consumers may change their computers every three years or their cell phones every two years; electric utilities will continue to operate power plants for 50 or 60 years.
Adding to the challenge is the complexity of systems integration. Combining three or four dozen different technologies for a smart grid system is far more difficult—and time consuming—than coming up with a new iPhone app.
Because energy involves the distribution of vital necessities, it is enmeshed in a great network of regulation, and the issues around it are often contentious. As a result, it generates a high degree of “political interest,” observed Professor Ernest Moniz, head of the Energy Initiative at MIT and another former undersecretary of energy. “This has enormous significance for what it takes to innovate and then introduce and scale new technologies.”18
It proceeds along a path, from knowledge creation—basic science to the lab bench and experimentation—to prototypes and demonstrations to commercialization and finally into the marketplace. The cast of characters in this enterprise ranges from theoretical physicists to entrepreneurs and venture capitalists to large companies and, of course, the final arbiters, consumers. But as the President’s Council of Advisors on Science and Technology has emphasized, this is not a linear process; it is not that something gets invented and then pushed out the door. Rather it is highly interactive among the stages, with the essential feedback generated by the “learning by doing” and the “learning by using.”
There were three specific initiatives. First, Energy Frontier Research Centers were established at universities and national labs to tackle grand challenges in energy. Second are new research hubs, which are meant to take on basic questions and encompass most of the innovation chain, from the basic research to the point when the know-how can be passed to the marketplace. The third initiative, developed in Congress and then implemented by the Obama administration, is ARPA-E, the Advanced Research Projects Agency for Energy. It was modeled on the Defense Advanced Research Projects Agency, DARPA,
Can today’s $70 trillion world economy be sure it will have the energy it needs to be a $130 trillion economy in two decades?
Ensconced at the patent office and with time on his hands, Einstein eventually went to work on a pent-up store of problems that were filling his mind. Over just ten weeks in the summer of 1905, in an astonishing burst of creativity and analysis, he would turn out five papers that would transform the understanding of the universe and change the world in which we live. One of them was called “Does the Inertia of a Body Depend upon Its Energy Content?” This was the paper with the famous equation: E=mc2
Between 2003 and 2009, Simon reduced its energy use by 25 percent. “As much as 60 percent were generated by the implementation of best practices and by using common sense and paying attention,” said George Caraghiaur, the executive at Simon responsible for energy efficiency. “That means shutting off lights, keeping doors closed, and not cooling the entire plant. Basically, it’s telling our mall managers to do the kind of things our parents told us to do.”13 Best practices also include “not easy to see” things, he said, such as proper maintenance of heating and air-conditioning systems. The other 40 percent required investment in such things as lighting, more efficient cooling systems, and management controls.
“So we’ve had to be wise about resources. I was taught at home, every child was taught at home, that you don’t leave a grain of rice on your plate. That’s mottainai. Too precious to waste.” 16
“While other fuels need ‘hard’ infrastructure like pipe and transmission lines,” energy efficiency requires its own infrastructure of “public policy support, education and awareness and innovative financing tools.” There are also technologies that need to be integrated into that infrastructure.
All this is directed toward achieving two objectives: One is shaving peak demand, which reduces the need to use the most expensive generating plants, saves money, and could reduce the need to build additional expensive new generating units. The second is to promote greater energy efficiency overall, which both saves energy and cuts down on CO2 emissions.
Traditional coal or nuclear or gas-fired generation is predictable and can be dispatched in a measured way. Renewable generation fluctuates; it depends on how much wind is blowing and whether the sun is shining. Thus, the grid needs to become more flexible and sophisticated to absorb the increasing but variable supply of renewable energy.
But the steamer and the electric car still held the lead. The first police car in America, which took to the road in Akron, Ohio, in 1899, was an electric vehicle.
Electrics were vexed by three major problems: cost, range, and recharging. The 1902 Phaeton, for instance, had a range of just 18 miles and could go no faster than 14 miles per hour.
He triumphantly wrote to Samuel Insull in 1910, promising the electricity tycoon a major new market for electricity. Or, as Edison put it, “to add many electric Pigs to your big Electric Sow.”13 But Edison was too late. Ford’s Model Ts were capturing a rapidly growing share of the rapidly growing market and were soon a runaway success. Moreover, with the invention of the electric ignition, motorists no longer had to crank their vehicles, which canceled out one of the decided advantages of the electric car and sealed the victory for the internal combustion engine.
A tax is also simpler and less likely to lead to distortions. It provides incentive for continuing innovation. By contrast, a target under regulation also becomes a ceiling. Once reached, there is no strong incentive to push further.
The Electrification Coalition, established in 2009, laid out a “road map” for the electric car that was adopted by both Democrats and Republicans alike. The coalition’s chairman, Frederick Smith, founder and CEO of FedEx, made clear that FedEx was interested in moving toward electric vehicles to deliver parcels.
However, in the 1970s and 1980s, researchers, beginning in an Exxon laboratory, were figuring out how lithium, the lightest of metals, could provide the basis for a new rechargeable battery.
But the work on lithium batteries could be put to very good use for another big need. In 1991, Sony introduced lithium-ion batteries in consumer electronics. These smaller, more powerful batteries enabled laptop computers to run faster and longer. And lithium batteries were decisively important for something else. They made it possible to shrink the size of cell phones, and thus powered the cell phone revolution. In theory, the greater energy density of lithium batteries, combined with their lower costs, could make them more viable for EVs—better
House.14 The Tesla Roadster was an exhilarating car to drive—0 to 60 in under four seconds—but its price point was not for a mass market. The starting price was $109,000. Moreover, recharging the car with a standard 110-volt outlet would take about 32 hours. With a 220-volt outlet, it’s 4.5 hours, although fast charging is promised down the road.
In the autumn of 2010, Nissan went to market with the Leaf—which stands for Leading, Environmentally friendly, Affordable, Family car. It rolled into showrooms with a 600-pound pack of lithium-ion batteries and promised an average driving range of around 90 to 100 miles and a top speed of 90 miles per hour.
Over the last few years, a new vision has taken shape: Wind and solar will generate the new, abundant electricity supplies, which will then be wheeled long-distance over an expanded and modernized transmission system. And then, when it gets to dense urban areas, the electricity will be managed by a smart grid that will move it through the distribution system, into the household or the charging station, and finally it will be fed into the battery of an electric car. Some take the vision further and imagine that cars will act as storage systems, “roving” batteries, which, when idle, will feed electricity back into the grid.
But that is quite different from the electric system that exists today in which renewables provide less than 2 percent of the power. Lee Schipper, a professor at Stanford University, argued that many EVs will become what he dubs EEVs—“emissions elsewhere vehicles.” That is, the emissions and greenhouse gases associated with transportation will not come out of the tailpipe of the car but potentially from the smokestack of a coal-fired power plant that generates the electricity that is fed into the EV. So one also has to take into account
Batteries are now a focus of intense and well-funded research around the world, aimed at addressing these questions. The entire effort is also very competitive—indeed, a global “battery race.” At the same time, there is a global debate as to where the “learning curve” for battery technology is and how fast it can come down.
People may use a small urban electric runabout for local needs and commuting—a sort of modern version of the Detroit Electrics and Baker Runabouts of the early twentieth century—and drive a bigger oil-fueled or hybrid car for longer trips or weekend getaways.
greater percentage of their residents are, or will be, first-time (or second-time) car buyers. This means they have fewer preconceived notions of what a car “should be” in terms of size and performance, as compared with their counterparts in more advanced countries. Moreover, many residents of developing Asian megacities, especially those in China, already have the experience of being transported in EVs, at least the two-wheel variety, in the form of electric bicycles.
Fuel cells continue to face major challenges. The fuel cells themselves—the device that converts hydrogen or another chemical feedstock into electricity—are expensive and will require substantial investment and breakthroughs for commercialization. One industry estimate is that their price would have to be reduced by a factor of twenty for them to become somewhat economical.27 Hydrogen is now mainly used in oil refineries and petrochemical plants to make high-quality products. Hydrogen does not exist independently in nature. It has to be manufactured from something else, which today, primarily, is natural gas, although it could also be manufactured using nuclear power. Storing and transporting hydrogen for automotive applications is also technically complex and certainly costly. Hydrogen vehicles would also require a great deal of investment in infrastructure—in this case, in hydrogen-fueling stations.
China’s surpassing the United States as the world’s largest car market in 2009 was a landmark. As a result of this shift, the policies of governments in developing countries will have increasingly greater impact on the global auto market.
Internal combustion engines do a remarkable job of generating power in an affordable and compact package. The secret to the success of the ICE lies in the energy density of liquid fuels—simply put,
decades, two billion people—about a quarter of the world’s population—will gain a significant “pay raise.” They will move from a per capita income of under $10,000 a year to between $10,000 and $30,000 a year.
A move away from Carnot’s combustibles has already begun, but we are in the early stage of a transition—or at least a remixing of the energy mix. It represents, in one form, a shift from the carbon-based fuels, predominant since the beginning of the Industrial Revolution, to noncarbon-based fuels. It has a second form as well—transition to a more energy-lean world that operates at a much higher level of energy efficiency. In transportation, that shift to greater efficiency is already evident, both in miles per gallon and in the spread of hybrid technology. Biofuels will likely have a growing presence, but to gain more market share, they need to reach the second generation. Natural gas appears slated to make inroads as a transportation fuel. As for the electric car, it is too early to assess how far and how fast it will penetrate the global auto fleet.
One sector stands out in terms of future growth—electric generation. Worldwide electricity consumption could almost double over two decades. Renewables have played a role in power generation for years in the form of hydropower. But in many countries its growth is either circumscribed or blocked altogether by environmental opposition. Another existing technology for electric generation is geothermal power, which uses steam created by deep heat in the earth to drive turbines. While an important contributor in some regions, geothermal is limited by geology and the availability of the right kind of “hot rocks” underground. The two big new noncarbon sources for generating electricity are wind and solar. They have registered great advances and much technological maturing since the “rays of hope” of the 1970s and early 1980s. Further advances, which will lower costs, are still to come.
And yet things can change quickly. Shale gas took two decades to begin to register in the marketplace. But once it did, in a matter of just a few years, it dramatically changed the economics not just of natural gas but of competitors, from nuclear power to wind power. By the early 2030s, overall global energy consumption may be 30 or 40 percent greater than it is today. The mix will probably not be too different from what it is today. Hydrocarbons will likely be somewhere between 75 and 80 percent of overall supply.
It is really after 2030 that the energy system could start to look quite different as the cumulative effect of innovation and technological advance makes its full impact felt. In the meantime, the elements shaping the future of energy are many, their interactions complex and sometimes confusing, and the differences in interests and perspectives considerable. All this makes forging a coherent “energy policy” a challenging matter. Indeed, “energy policy” is often shaped by policies that are not even seen as “energy” but as “environmental.” But history suggests that certain principles will be useful in making decisions in the future. The first is to start with the recognition of the scale, complexity, and importance of the energy foundations on which a world economy depends, whether it is today’s $70 trillion economy or a $130 trillion economy two decades from now. There
Energy efficiency remains a top priority for a growing world economy.
Environmental priorities need to continue to be integrated into energy production and consumption.
A famous geologist once said, “Oil is found in the minds of men.” We can amend that to say that the energy solutions for the twenty-first century will be found in the minds of people around the world.