TRANSCIPT
It’s Throw forward Thursday, the day that we look ahead at the future and see what’s going to happen. Look around here, look around the room that you’re in right now, you do it. Every single thing that you can see has required energy to get it to your room, whether it’s the lights or the heating and cooling which you are using energy right now or any object in your room. That object had to be created, made, manufactured somewhere.
And energy was required to do that. Then it was transported to you and the transportation took up energy. Energy is everywhere. It’s not just the price of oil and how much batteries cost. Energy is baked into our economic system and the cost of energy is a significant contributor to all the costs of everything everywhere. So, if we change, if we solve an energy problem and change the cost of energy, we will change the world. Now, with that in mind, let’s throw forward to sometime in the 20s, 30s, where three things have changed dramatically.
The first thing is that a lot more people and a lot more businesses are producing their own electricity. This is going to happen. People are going to move to a much more blended approach where they are not just buying electricity off of the grid. That in most cases is a national grid that’s controlled by the national government or even if it’s privatised, it’s still very much seen as a national asset. By the 2030’s a significant number of people around the world are going to have a blended approach where they produce some, if not all, of their own energy.
The second thing that’s going to have changed dramatically is significant improvements in storage capacity, batteries to put it in another way. But batteries will look a lot different right now. As I record this in 2021, I think the most exciting stuff coming out of Tesla is not the SpaceX stuff that Elon Musk’s doing. It’s not the Tesla cars and the Tesla truck. It’s actually the battery technologies. It’s the batteries in the Tesla cars that actually help them stand apart from other electric cars even now.
But it’s the Tesla Powerwall. It’s those roof tiles that look like towels but are actually batteries and solar panels. And that’s a significant contribution. And in by 2030 something, Tesla will be making way more money out of selling batteries than cars or trips to Mars. We will also have significantly improved batteries. There are all sorts of improvements already visible on our horizon. Obviously, lithium ion has made a significant contribution to the size and the and the strength and the storage capacity of batteries about graphene.
We talked about this a few weeks ago on Throw Forward Thursday’s Graphene. Batteries apparently promised 100 times improvement over other technology and other options are available. The third thing that will happen is not just that our energy will be cleaner. I could have said they were four things and just said the third thing is that they were cleaner. And then the last thing is. But I think that too often we only think about how green and clean energy might be. I think that’s almost too obvious to put on a Throw Forward Thursday.
For me, it goes beyond the fact that our energy will be clean, but the types of energies that are clean. Things like wind power, wave power, solar power are also once you have put up the facilities, once you’ve put up the wind turbines, once you’ve installed the solar panels, they pretty much pay for themselves. They are cheap as well as clean. And that, for me, is what to Throw Forward Thursday is about today.
There’s a lot to get our heads around in terms of the energy ecosystem. But where we’re heading to in the 20s, 30s, most importantly, I think is cheap energy. Let me give you one example. ITER is the International Thermonuclear Experimental Reactor that’s based down in the south of France. It’s been under construction for a decade now, already a little bit behind its original schedule. But within the next few years will start producing electricity. And yes, it is a multi-billion Euro project funded by 12 governments I think it is. So, again, there’s a massive cost of investment to get this thing going. But when it works and when it’s underway, the fuel that is used to create energy in this case, to create heat, which then drives turbines, which creates electricity, the underlying fuel is seawater. Basically, I’m oversimplifying. Go and have a look at iter.org, their website to have a look at the at the details.
But yes, there is a massive upfront investment. But after that, the running costs and the costs of the fuel is essentially zero. And this is what has happened in industry after industry in the past, massive upfront investments on railroads, telegraphs and massive technologies that have changed the world. What typically happens is the initial companies that rush into these things and do all the investment go bankrupt and what do they do? They leave the infrastructure behind them. This is not going to become an economics lecture.
But there is an interesting thought there that some of this invested, sunk cost can just be ignored. And then we have got an infrastructure, we’ve got a system that we can then basically use. And if the unit cost is low of production after that, we get the benefits of it. Now, I’m not suggesting that that’s an economic model that we should use, and I’m not even suggesting that that’s what will happen. ITER has been deliberately established as the very first the very earliest prototype of a new way of generating energy, which basically creates a little star, a little sun on earth that produces energy without creating massive side effects.
It’s not nuclear energy, as we’ve known it up to now. And already there are ways to make this device smaller, cheaper, even mobile. And by 2030 or the early 2030s, I think we will have many of these in different locations around the world turning seawater or waves or rivers or sunshine, all of which are free, turning that into cheap energy. So now look around you again, look at everything around you and ask what would happen to the world if we were able to take 20 percent?
That’s most economists guess at the cost that energy adds into every product or the food you eat, the clothes you wear, the house you live in, 20% minimum is the cost of energy. What happens if we could take that from a 20% cost to a one per cent cost Throw Forward Thursday? Today is actually not about energy. It’s about one of the things that could change the entire economic equation of everything in every industry and every part of the planet.
It was a long walk to get there, but if I’m right, it was worth it today. Throw forward Thursday takes us into the 2030’s when an entirely different energy mix gives us an entirely different world. It’s remarkable. Am I right? Let’s wait and see. But until then, make sure that you subscribe to our Throw Forward Thursday. If you’re watching on YouTube, hit the notification bell so that you can get a message when you get the next one, will, it’ll be next Thursday. If you’re listening on the podcast as a bonus edition. Well, make sure that you subscribe and write us on your favourite podcast platform, and I’ll see you next Thursday when we take another possibly breathless look at what’s going to happen in the near future, I’ll see you then.
Graeme Codrington, is an internationally recognized futurist, specializing in the future of work. He helps organizations understand the forces that will shape our lives in the next ten years, and how we can respond in order to confidently stay ahead of change. Chat to us about booking Graeme to help you Re-Imagine and upgrade your thinking to identify the emerging opportunities in your industry.
For the past two decades, Graeme has worked with some of the world’s most recognized brands, travelling to over 80 countries in total, and speaking to around 100,000 people every year. He is the author of 5 best-selling books, and on faculty at 5 top global business schools.