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Santigo conf lecture


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Santigo conf lecture

  1. 1. The structure and duration of energy transitions: To what extent are alternative energies different? Professor David E Nye 27 april 2017 17:30 – 19:00
  2. 2. What Slows Change to alternative energies? The usual answers Journalists & Political Scientists: Lobbyists and special interests Intellectual Historian: Free market ideology Pollster: Public focuses on other issues Entrepreneur: Lack of leadership and vision, excessive regulation Economic Historian: Path Dependency Technological Historian: Technological Momentum
  3. 3. Outline I. The structure and duration of energy transitions 1. Transition from what? National variation 2. Historical patterns 3. Theory 1: technological momentum (Hughes) 4. Theory 2: path dependency (David) II. To what extent are alternative energies different? 1. Alternative Energy compared with electrification 2. Similarities 3. Differences 4. Prospects
  4. 4. 1.1 Transition from what? Energy supply variation by nation
  5. 5. Norway vs. Sweden, 2002
  6. 6. France vs. Germany, 2002
  7. 7. Australia vs. New Zealand, 2002
  8. 8. State Energy Consumption 2016
  9. 9. What supply variation suggests: Different geographies shape, but do not dictate, energy systems. Large national variations. Within US, large variations in green energy & in consumption - Texas per capita btu’s is double California’s level No single global ‘path’ to sustainability. Electrification systems are (partly) adjusted to environments. Energy policy in France cannot resemble that in Norway, that in New Zealand does not resemble the US, etc.
  10. 10. 1.2 Historical examples: US Energy Transitions
  11. 11. Energy Transitions Take 50-60 years Water powered factories, 1790–1840 Steam engines, 1820–1890 Electrification, 1875–1940 From coal to oil & gas, 1900 –1960 Alternative energies, 1975–2035
  12. 12. water power to steam power, 1870-1900 in New England %
  13. 13. Factory power, % electric 1890 - 1930 0 10 20 30 40 50 60 70 80 90 1890 1900 1910 1920 1930 Source: Nye, Electrifying America, 187. 1875-1900 – growth to 3.6% of market 1900-1930 – growth to 78% of market
  14. 14. US transition: coal to oil and natural gas, 1920-1960
  15. 15. Conclusions US transitions have taken c. 50-60 years Slow growth for first 25+ years Rapid growth the next 25 years Electrification fits this model Can take longer, e.g. US steam power Not substitutions but additions A key difference from green energy substitutions & not additions Green energies seem to be starting phase 2
  16. 16. Two approaches to Energy Transitions 1.3 Path Dependency & 1.4 Technological Momentum
  17. 17. 1.3 Path Dependence’ Theory Paul David & W. Brian Arthur argue history is important in explaining economic behaviour. Cultural patterns persist. Arbitrary choices in first generation block later alternatives - constraining development of the best design QWERTY designed to minimize jamming keys - based on frequency of individual letters in English. Resistance to replacing keyboards & retraining typists French speakers did not adopt QWERTY.
  18. 18. Critiques of Path Dependency: QWERTY itself is atypical Too much emphasis on accident, too little focus on invention process Lock-in not early but late. Dis-empowering; we become prisoners of the past While accurate for some technologies, it may not describe energy systems. Every technology is eventually replaced, but path dependence leads to stagnation.
  19. 19. 1.4 ‘Technological Momentum’ Thomas Hughes, Networks of Power Compares US, UK, Germany 5 stages (dates vary by location) 1875-1882 invention/development few locations 1882-1890 transfer to other regions 1890- growth of infrastructures for production, education, and consumption 1900, technological momentum 1910, mature stage ? challenge from alternatives
  20. 20. Basic Bibliography – Technological Momentum Thomas P. Hughes, Networks of Power (Baltimore: Johns Hopkins University Press, 1983.) Thomas P. Hughes, “Technological Momentum: Hydrogenation in Germany, 1900-1933,” Past and Present (Aug. 1969): 106-132. Thomas P. Hughes, "Technological Momentum," in Merritt Roe Smith and Leo Marx, Does Technology Drive History? The Dilemma of Technological Determinism (MIT Press, 1994), 101-113. Richard F. Hirsh, “Power Struggle: Changing Momentum in the Restructured American Electric Utility System,” L’électricité en réseaux: Networks of Power - Annales historiques de l’électricité, 2004:2, 107-123.
  21. 21. Key Concept: Reverse salients “Networked systems . . . evolve like a shifting front. The components and firms that fall behind, I name ‘reverse salients’; those that move ahead are ‘salients’. Reverse salients in networked systems need to be corrected in order for the systems to continue to evolve. An example of a reverse salient in early electric power systems was the absence of a satisfactory motor for alternating current systems.” Thomas Parke Hughes, “Afterword,” Annales Historiques de l’électrcité, juin 2004, 174. Battle line, Verdun, World War I Reverse salient of Verdun in World War I Reverse salient of Verdun A salient is a bulge in the trench lines between two opposing forces. The protrusion of one army’s lines into the trenches of the enemy threatens to halt or reverse its progress.
  22. 22. Combining the two theories Invention transfer to a few other regions growth & reverse salients technological momentum mature stage Alternatives emerge (latency) Invention , etc. Hughes Momentum Path Dependency kicks in Limitations of system [environmental, economic, etc. ] Energy transition Sequence Combined Theory latency period (before persistence)
  23. 23. Conclusions, Part 1 Large national variation in energy sources in per capita demand no common starting point for energy transitions ‘Technological Momentum’ invention and design as rational choice inflected by culture, especially in 3 first stages tech systems less flexible after techological momentum ‘Path dependency’ attributes much to accident lock-in too early accounts for the mature stage Unified theory stronger than either by itself
  24. 24. II. Is the green energy transition different?
  25. 25. Alternative Energy compared with electrification Stage 1 Electrification Latency period, c. 1808-1875 Commerical experimental efforts, 1870 - 1880 Demonstration installations Many competitors Tiny market share Alternative Energies Latency period Commerical experimental efforts, 1970s – 1980s Demonstration installations Many competitors Tiny market share
  26. 26. Alternative Energy compared with electrification Stage 2: Demonstration at a few sites Electrification 1882-1890 Demonstrated at world’s fairs Sold as prestige project that anticipated the future Little market penetration except for lighting. Only the wealthiest 2% have electrified homes Alternative Energies, 1990s Demonstrated at special events like the US Solar decathlon Sold as prestige project that anticipated the future Mostly wealthy homes have alternative energy
  27. 27. Winner of Solar Decathlon 2013: Austria
  28. 28. Alternative Energy compared with electrification Stage 3 Expansion Electrification, 1890-1900 More expensive than gas for lighting or steam for power Niche markets growing Reverse salients Alternating current AC motor Batteries Alternative Energies, 2000-2013 More expensive than fossil fuels Government subsidies Niche markets growing Reverse salients Reliable gears for windmills Increasing efficiency of solar panels
  29. 29. Samsø Island Population c. 4,000. twice the size of Manhattan 1997: 100% fossil fuels: oil, coal and gas 2005: 100% green energy 21 Windmills 10 on land, 11 at sea + district heating, burning hay + Solar panels on some houses + house insullation program + developing biofuels 500,000 tourists a year Samsø to eliminate all oil products Denmark Sweden
  30. 30. Samsø’s windmills Local ownership of windmills 1 in 10 residents owns shares – and makes an income from them Local government owns 5 off-shore windmills: $8 million revenue a year Each mill paid back energy used to make it in the first 210 days Samsø exports 80 million KW a year.
  31. 31. Alternative Energy compared with electrification Stage 4 Technological Momentum Electrification, 1900-10 Regional grids balance load price per kwh falls Economies of scale sales and service infrastructure Alternative Energies, 2010-20 Storage and load balancing problems solved 2013 wind and solar competitive with coal Scaling up of production sales and service infrastructure
  32. 32. Global renewable energy investment 2004-16 (excluding large hydro)
  33. 33. EU Green energy, 2004-2014: 93% growth
  34. 34. Falling prices: solar & wind power
  35. 35. Alternative Energies: New investment vs. New Build
  36. 36. Alternative Energy compared with electrification Stage 5: Maturity (30 years) Electrification 1910-40 Inventors & entrepreneurs give way to financial managers who raise funds & face political issues Rapid growth Housing: 15 to 65% in 12 years Factory: 18 to 78% in 20 years Alternative Energies 2020-50 Inventors & entrepreneurs give way to financial managers Rapid growth 0 10 20 30 40 50 60 70 80 90 1890 1900 1910 1920 1930
  37. 37. US electricity customers % of all homes 1902 - 1927 0 10 20 30 40 50 60 70 1902 1912 1917 1922 1927 domestic customers % By 1927, most urban homes were electrified, but only 10% of the farms were.
  38. 38. 264 268 359 446 601 805 1022 1438 2186 0 500 1000 1500 2000 2500 1912 1917 1922 1927 1932 1937 1942 1947 1952 United States annual kwh consumption per domestic customer 1912 - 1952
  39. 39. 2.2 Similarities Time Frame of 50-60 years Slow growth during stages 1-3 Problems: high consumer cost & reverse salients Technological momentum after c. 30 years Market share small after 30 years Extremely rapid growth in mature stage
  40. 40. Rapid Growth: Wind and Solar in Portugal From 2013 to 2015 grew from 23% to 48% of the electrical supply. In May, 2016, clean energy provided 100% of the country’s electricity for 107 consecutive hours. The Guardian, May 18, 2016.
  41. 41. 2.3 Differences Shift to electric car less difficult than shift from horses to cars For the first time, this transition demands reduction in energy use. 1940-2001: average US household’s electrical consumption grew by 1300%. For first time a substitution, not addition to capacity Utilities lose investment if they close coal power stations Previous transitions required a new infrastructure for production and for consumption. e.g. Coal to oil But a house can convert to green electricity at no cost  Or house can become an energy producer.  Utilities risk declining demand and new kind of competition.
  42. 42. Declining utilization of coal plants, China & India construction of coal-fired power plants dropped 62 percent In 2016 worldwide
  43. 43. Danish electrical production 1990 3% green 2015 56% green Electric power stations Centralized co-generation Decentralized co-generation Industrial producers Alternative energies
  44. 44. 2.4 Prospects
  45. 45. Growth in Global Solar Energy Capacity, 2000-2015 (GW)
  46. 46. Wall Street Journal on US Green Housing
  47. 47. Green energy as investment opportunity (1) 2015 Developing markets invest $156 billion in clean energy Developed markets $130 billion 2016: McKinsey & Company, “Accelerating the energy transition: cost or opportunity? A thought starter for the Netherlands,” September, 2016. By 2040 Netherlands could reduce CO2 emissions by 75% and get 80% of its energy from renewables. Would create jobs, reduce health care costs. transition-cost-or-opportunity 2016 Nature Climate Change study concludes that existing technology could supply the US with green electricity by 2030. Climate Wire, Jan 26, 2016.
  48. 48. Green energy as investment opportunity (2) 2016: US Energy Information Administration predicted alternative energies would surpass coal in 2030. EU Wind power provided more energy than nuclear plants in 2013, passed hydroelectric power in 2015 surpassed coal in 2016 In 2016 80% of new electricity generation was green Ian Johnston, “Renewable energy,” The Independent, Feb 9, 2017. 2017: World Economic Forum urges investment in renewable infrastructure, which routinely returns 6-10%.
  49. 49. Sierra Club Executive Leader of “Beyond Coal” & Michael Bloomberg Former Mayor of NYC St. Martins Press, 2017
  50. 50. The Solutions Project Led by Stanford University Professor Mark Jacobson To show how the world can shift 100% to green energy by 2050 Plans for 139 countries Which energy solutions are best for each country? Predicts reduced energy needs using green energies The jobs created or lost Health benefits Presented in Paris, when climate accords were agreed.
  51. 51. Danish Energy Use, by Sector, 1990 - 2015 Home Industry Miscel. Trade & services Transport Energy sector
  52. 52. Solar 54.1% 36.9 %Solar panels 6.9% Business/gov panels 5.3 % Residential rooftop 5 % Concentrated solar Wind 35% 25% onshore 10% offshore
  53. 53. Chile Goal: 60 percent clean energy by the year 2035 Hydropower in the mountains Wind power, South and along coasts. Solar and wind in Chile cheaper than fossil fuels Northern desert is the best solar area in the world & Geothermal: Cerro Pabellón, 48 MW
  54. 54. Historical energy transitions model the alternative energy transition Green energies have overcome reverse salients and achieved technological momentum; costs will keep falling. Fossil fuels have lost cost advantage, but still have technological momentum. Higher energy intensity + green energy can lower consumption. Government regulation crucial. By 2050, conversion to green energies will likely be 80%+ Energy now less a technological than a cultural/political problem.
  55. 55. Works related to this lecture Electrifying America: Social Meanings of a New Technology MIT Press, 1990. Consuming Power: A Social History of American Energies MIT Press, 1998. "Path Insistence: Comparing European and American Attitudes Toward Energy," Journal of International Affairs 53:1 (1999) 129-148. “Electricity and Culture: Conceptualizing the American Case,” L’électricité en réseaux: Networks of Power - Annales historiques de l’électricité, 2004:2, 125-138. When the Lights Went Out. MIT Press, 2010. The Environmental Humanities, A Critical Introduction. MIT Press, 2017 [with Robert Emmett] American Illuminations. MIT Press, 2018.
  56. 56. Thank you Gracias Tak