Political and industrial leaders are now in near consensus: The world must change how it produces and consumes energy to address the geopolitical and environmental challenges of our current energy systems. The transition will take decades, but the vision is starting to come into focus.
The 'New Energy Economy' is a term used to describe a future based on clean, abundant energy ('clean' electrons and 'clean' molecules) derived from a wide range of sources including renewable sources, 'greener' fossil fuels, bioenergy and nuclear power.
In real terms, the New Energy Economy describes the journey, not a single moment in the future. Many of the pieces of this new energy world do not yet exist. They will be based on new science, new technologies, 'smarter' infrastructure, and industries that are just now starting to enter the mainstream conversations about the future of energy.
The Smart Grid
While oil receives most of our attention, it is electricity that powers the future. Take away the combustion engine, and almost every object and business in the world runs on electrons. Demand for electricity in China and India is 3 to 5 times that of oil. And the growth industries of the 21st century all run on electricity.
The problem is that our current electrical 'grid' design is based on a dated model of distributing energy via one way flows with no viable forms of local storage or onsite production. Most electrical grids are aging, and in rapidly growing cities, demand is outpacing new capacity. We cannot assume that the lights will always be on.
The 'smart grid' describes a future infrastructure model that transforms how we manage, distribute and store electrons using the power of software, sensors and distributed power systems.
Bioenergy is a powerful idea that is largely misunderstood. The future is not corn ethanol or soy-based biodiesel. The future of bioenergy is based on the power of microorganisms — algae and bacteria.
Instead of extracting energy from the Earth, what if we could grow our own energy, above ground, by tapping the power of algae and bacteria that convert carbon into usable forms of liquid fuels and hydrogen?
The most dominant forms of energy — coal and oil — arrived here via biology. Coal is ancient plant mass, and oil is likely ancient microorganisms that lived in shallow seas. In both cases, life ate carbon and then, using the power of sunlight, combined the carbon with hydrogen (from water) to form hydrocarbons. The fossil fuels we know are types of hydrocarbons.
Every time we drive our car we are using ancient algae biofuels. And now energy entrepreneurs are developing pilot scale plants to eat carbon and produce clean forms of energy. The grand vision of bioenergy is to use carbon-eating microorganisms to capture emissions from coal plants to produce cleaner fuels.
Renewables & Energy Storage
We are still at the beginning of the era of renewable energy production from solar, wind and ocean power. There are still huge opportunities that will arise from advances in basic science and engineering. But the key to expanding renewable energy resources is dependent on changing regulations that govern utility power generation.
What is the problem? Storage and reliability.
Assuming we can scale solar and wind farms to produce massive amounts of energy, they still suffer from the problem of intermittency: They only produce power when the wind is blowing or when the sun is shining.
Without an effective way to store energy, utility companies are reluctant to investment in renewables. These companies are not anti-renewable energy, as much as they are pro-reliable energy.
Advances in our ability to store energy via batteries, fuel cells and capacitors could change how we produce and consume energy from renewables.
While we might be overestimating how much change can happen in the short term, the long term changes could be profound. And the next century could be driven by new science, new business models and new policies that we are only now just starting to explore.
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