Navigating the Latest Energy Transition

Navigating the Latest Energy Transition

1024 742 Seth Terry

The Landscape Today

Though we may at times struggle fully understanding energy, many of us likely perceive major changes in the energy landscape. Low-cost natural gas increasingly displaces coal.  Renewable sources, such as wind and solar energy make up larger shares of our fuel mix. And early adopters have already pushed into batteries, electric vehicles, and distributed generation in the home! We can hardly miss debate over choices available to consumers. And increasingly, new options take hold faster due to economic, resource, and environmental reasons.  Doubtless, we find ourselves at the fore of a significant historical shift. Understanding context not only helps in navigating the latest energy transition. It also points to opportunities for saving money over time.

History and Context

Although this energy shift may feel unique, we should recognize having gone through similar events in the past. The chart below (derived from O’Conner and Cleveland (2014) and EIA) provides an overview for past energy transitions. It shows the share for each fuel type (thin colored lines) as a percentage of total US energy consumption (the thicker, shaded line). From it, we can determine the dominant fuel at any point in our history.

At its birth, the US relied almost exclusively on burning wood (the brown line) for energy. Of note, the “clean-burning” alternative to burning wood and other plant material was oil — from animals such as whales. As late as the War of 1812, wood still provided 99% of all fuel in the US. But by the 1861 start of the Civil War, coal (the black line) held a 15% market share and became “the other solid fuel.” And at century’s end, the US had firmly transitioned to coal power. However, even then, oil from wells (the muted red line) already presented a cleaner-burning, more convenient source — especially for transportation. Consequently, the US reached “peak coal” as a percentage of total consumption just after the first Ford Model Ts rolled off the assembly line.

Therefore, the US has already withstood at least two energy transitions: from wood to coal and from coal to oil. And arguably, we are at the fore of navigating another, latest energy transition. This time moving towards lower emissions and renewable fuel sources. For example, natural gas (the bright red line) increasingly challenges oil for dominance. Meanwhile, nuclear energy (the yellow line), though perhaps plateaued, holds steady with about a 10% market share.

The Next Chapter

At least two important zero-emission fuel sources do not appear in the above graph: wind and solar. In brief, these sources currently supply only a small percentage of our current fuel. Therefore, they would barely show up on our first graph above. However, their adoption rate is rapid and they are projected to weigh heavily in our upcoming energy transition.

The graph below (produced by Dan Schroeder) shows similar information to our earlier plot. But it only covers the period 1850-2014 and uses a logarithmic scale to permit display for both large and small numbers. As a result, smaller numbers show up better against larger ones. Note also that this graph marks total consumption not by percent (as above), but rather in the energy units of “quads.” Conveniently, total US consumption sits at just under 100 quads — corresponding nicely to 100% consumption (refer to the first graph to see both scales at the same time).

To help further with scale, we compare the same yellow line for nuclear data seen in both graphs. Beneath this line in the second graph are green lines for wind and solar. Clearly, these two sources show growth at rates far in excess of any other. However, even in 2017, these numbers only account for about 3% of total energy consumption. But considering that this share was only about 1.2% in 2000, the adoption rate is staggering. Therefore, it supports our place in the early stages of another transition. We note this transition just as Tesla, Rivian, Proterra, BYD, and UPS provide evermore compelling reasons to move much of the 36 quads of oil for vehicles onto the electric grid! Click here for a powerful visualization of grid changes over the last 17 years!

Meaning for Consumers

Clearly, the energy grid is changing — fast. This change presents both opportunities and challenges. With respect to opportunities, we note the promise of deriving more energy from renewable sources with zero emissions. With respect to challenges, utilities now must contend with new fuel sources that they cannot control — and at times control them. For example, the Duck Curve contributes at least in part to real-time price swings for electricity. Therefore, as utilities contend with renewable fuel sources and restructure tariff plans, we consumers stand both to benefit and to be hurt.

But surely there should be a way for us to make smart decisions around energy use and conservation. For example, might we save money by changing use patterns to match better with real-time pricing? Or, could we make investments in equipment, appliances, or home improvement to improve efficiency and control? And could electric vehicles be used to influence our spending for energy storage and use for transportation? Of course, the answer to each of these questions is “yes!” But the best approach to making these decisions would account for conditions that vary by region, by time, and by individual household.  Further, this approach should provide tailored recommendations that maximize savings to the consumer.

With this consideration in mind, Emporia Energy developed its the Emporia Vue, an innovative IoT energy efficiency technology platform.  Over time, the Vue learns usage patterns and requests feedback from users to help achieve savings while navigating the energy transition.  Additionally, the Vue provides insight into the broader impact of our energy consumption and further highlights how fuel mix impacts pollution. Finally, Emporia connects consumers with products and services that facilitate and enhance their savings — both for them and for their environment.