presentación workshop

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. 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. 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. 1.1 Transition from what?
Energy supply variation by nation

5. Norway vs. Sweden, 2002

6. France vs. Germany, 2002

7. Australia vs. New Zealand, 2002

8. State Energy Consumption 2016

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. 1.2
Historical examples:
US Energy Transitions

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. water power to steam power,
1870-1900 in New England
%

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. US transition: coal to oil and natural gas,
1920-1960

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. Two approaches to Energy Transitions
1.3 Path Dependency
&
1.4 Technological Momentum

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. 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. 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. 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. 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. 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. 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. II.
Is the green energy
transition different?

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. 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. Winner of Solar Decathlon 2013: Austria

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. 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
https://www.scientificamerican.com/article/samso-attempts-100-percent-renewable-power/
Denmark
Sweden

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. 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. Global renewable energy investment 2004-16
(excluding large hydro)

33. EU Green energy, 2004-2014: 93% growth

34. Falling prices: solar & wind power

35. Alternative Energies:
New investment vs. New Build

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. 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. 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. 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. 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. 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.

43. Declining utilization of
coal plants, China & India
construction of coal-fired
power plants
dropped 62 percent
In 2016 worldwide

44. Danish electrical production
1990 3% green
2015 56% green
Electric power stations
Centralized co-generation
Decentralized co-generation
Industrial producers
Alternative energies

45. 2.4 Prospects

46. Growth in Global Solar Energy Capacity,
2000-2015 (GW)

47. Wall Street Journal on US Green Housing

48. 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.
http://www.mckinsey.com/global-themes/europe/accelerating-the-energy-
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.

49. 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%.

50. Sierra Club Executive
Leader of “Beyond Coal”
&
Michael Bloomberg
Former Mayor of NYC
St. Martins Press, 2017

51. 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.

55. Danish Energy Use, by Sector, 1990 - 2015
Home
Industry
Miscel.
Trade & services
Transport
Energy sector

57. 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

58. 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

59. 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.

60. 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.

61. Thank you Gracias Tak