Electricity industry sparks with disruptive change
Electric power today is not your grandmother’s electricity.
Although many electric utilities have been around 50 to 100 years and few utilities’ business models have changed much in that time, disruptive change is here — and accelerating.
“We are sitting on the cusp of major transformation,” said Maryrose Sylvester, president and CEO of Current, by GE, speaking at VERGE 16. As a spinoff of a 124-year-old energy equipment company, Current’s very existence speaks to the change underway: It is involved in distributed energy and Internet of Things enabled energy efficiency.
Electric power generated from clean, renewable sources; power delivery that’s integrated with Internet of Things connectivity to customers’ specific electricity needs; distributed, independently operating microgrid generators that can exist in the remotest places on earth; a focus on energy efficiency and using less energy; a consciousness of energy inequities both in who has access to renewables and who has suffered energy pollution. These are just some of the big changes in electric power underscored in a dozen or more conversations at VERGE 16.
Consider this: “Microsoft literally uses as much energy as the State of Alaska, and within decades we’ll use as much energy as a country,” said Rob Bernard, chief environmental strategist at Microsoft. That means the software giant has decided it has a rightful place — and responsibility — to be at the table carving the globe’s energy future.
“As we are building out the Internet with several thousand data centers, (Microsoft is focused on) how do we drive new, clean energy generation,” Bernard said. It already gets 40 percent of its power from renewable sources.
Or consider this: The US Department of Energy is investing $2 billion annually in clean energy innovation — more than any other investor — and producing an average 20 percent annual return-on-investment for taxpayers.
The transformation to clean energy underway “will be a multi-trillion investment opportunity,” said DOE Assistant Secretary David Friedman.
“So, ask yourself, do you want a piece of the pie? You can make a choice to invest in the future of the clean energy revolution, where companies are making more money off the solutions than the problems,” he said to the audience of 1,500 tech innovators, investors, NGO leaders, students and sustainability professionals.
These statistics describe the disruption underway: Since 2008, according to DOE:
Wind power generation has tripled to 70 gigawatts across the U.S. while its cost has fallen 40 percent.
Solar deployment has grown 20-fold while its price has fallen 60 percent.
LED lights have just about taken over the electric lighting market, with 200 million LED lights sold in the U.S. and a price reduction of 90 percent.
Electric vehicles, while still pricier than gasoline powered vehicles, are in every state with 420,000 on the road.
Storage battery prices have fallen 70 percent since they first went on the market.
As scientist Amory Lovins, chairman of the Rocky Mountain Institute, said, “Wind power is often making coal, nuclear and (petroleum-based) plants too costly to run. Solar — unsubsidized solar — at 3 cents a kilowatt hour is winning energy markets.”
Crumbling in the disruptive energy market underway are the arguments against renewables.
“We’re often told that only coal and nuclear can keep the power on 24-7 because they are the only reliable (energy sources). Yet variable renewables can be forecasted,” Lovins said.
And “we built the grid because no generation is 24-7. Things often break. The grid manages intermittencies by balancing non-working plants with working plants. The same can happen if integrated, forecasted and diversified renewables come onto the grid,” he pointed out.
“In an orchestra, no one instrument is played all the time, but the ensemble plays music continually,” Lovins said, adding that so too in an integrated diversified grid, different renewables can contribute to generation at different times.