We are in the midst of a major phase transition in the global energy system. Within the next two decades, the entire fossil fuel system is going to be disrupted as a new energy system based on completely different technologies – primarily solar and wind – takes precedence. In my last post, I dived deep into the range of scientific forecasting studies providing robust empirical evidence that this disruption is now unstoppable for all intents and purposes.
Driven by fundamental economic factors, the deployment of global solar and wind appears to have passed a tipping point similar to that passed by many different technology disruptions in history, from the printing press’ disruption of manuscripts, to the car’s disruption of horses; from the smartphone’s disruption of landlines, to the internet’s disruption of print newspapers – many of which occurred over just a few decades.
Such technology disruptions are not just one-for-one substitutions which swap out new tech for old tech in the same system. They change the very rules and structure that define the system itself – they create new rules, new structures, that lead to the emergence of a new system.
That’s why what’s coming is not going to be a linear replacement of one set of products with a new set of products – but a total root and branch transformation of the energy system.
Yet the precise nature of this transformation - which will redefine the limits and possibilities of our societies in totally new ways compared to the fossil fuel system - is not set in stone but will depend on our choices.
The scope of change
What’s happening now is a ‘phase transition’. This isn’t just an abstract highbrow theoretical notion – it has specific implications which help us to understand the dynamics of change today and our role in it.
Phase-transitions are ubiquitous in nature. We can see them across physical and biological systems. A ‘phase-transition’ occurs when a system undergoes a fundamental change of state, due to a “sharp transition” in the degree of organisation within the system as a result of changing external conditions or pressures.
The way these physical and biological systems are organised depends on interactions between the physical forces by which they are composed, and which surround them. A sudden increase in the temperature of water, for instance, destabilises the relationship between its molecules, resulting in a ‘phase transition’ from a liquid into a gas with totally different properties.
So the nature of a ‘phase transition’ depends on the 1. nature of the different things within the existing system, 2. how those things are related internally, and 3. how that overall system is related to its surrounding conditions.
The system of water in a liquid state might appear to be adapted to a certain set of external conditions. Its behaviour at that level would seem fairly predictable within certain parameters. But when those conditions change rapidly, in this case through a sudden temperature increase, then it enforces a dramatic and fundamental change in the system’s internal relations. What emerges is a different gaseous system operating in an entirely new state from before with totally different properties - properties that could not have been understood just by looking at the water's behaviour in a liquid state.
When we talk about a ‘phase’ of a system, we're basically talking about how it's organised, which can be captured by inferring the ‘rules’ and ‘properties’ that define its behaviour. A system that moves through a phase transition experiences a transformation in its rules and properties as a new 'phase' emerges with completely new rules and properties.
Recognising the energy system transformation as a phase transition helps us recognise a few key things:
1. It’s going to be fast. Like when heating up water, at first you might be waiting what seems like a long time: but suddenly it breaches a tipping point and before you know it, it’s boiling, and there’s steam.
2. Our choices will play a fundamental role in the ultimate structure of the new energy system. That’s because we are major ‘units’ in the system, and our decisions are among the major ‘forcings’ on its conditions. So while there are many big dynamics in play driving major change, the choices we make will play a big role in determining how the system evolves.
3. Our choices will have an outsize impact because the entire system is up for grabs. In previous conditions of system equilibrium there is not much scope for change, due to big top down system constraints. But when the system is in phase transition, as the old system dies, it loses control – as the old order with its rules and properties breaks down. This creates much larger scope for change, for creating new rules and new dynamics - for agency. There’s a far larger scope for outsize impacts in a way that previously was unthinkable.
4. But there’s not just an old system dying. There’s a new one emerging. The energy system transformation is based on the fact that specific technologies are exponentially improving in such a way that they are outcompeting the old. These technologies have specific properties different to what went before. This means that to get to the other side of this phase transition intact, we have to scale through this process by leveraging these emerging properties in the best way we can. To do that, we need to understand them as best we can, to make more informed choices. As the phase transition accelerates, we can use our newfound capacity for outsize impact to make design choices which maximise and optimise the positive possibilities of the emerging system, while minimising and reducing any negative consequences and limitations.
So what are the key properties of this emerging system?
There’s now a strong body of scientific literature which we can draw on to understand the new possibilities of the emerging clean energy system.
In this post, I’m going to bring some of this literature together to give you a really clear and powerful picture of this emerging energy system; this in turn will help inform the pathways ahead for how we can adapt to and drive this phase transition in directions which are most useful for humanity and the planet.
Conventional analysts keep repeating the idea that as renewable energy capacity grows exponentially, so too will the need for storage in order to ensure there's enough energy available to save and draw from at times when the sun isn't shining or the wind isn't blowing. Like this guy:
But you'll notice that the graph only displays what happens as you incrementally grow renewable energy up to 100%. But there's now a tonne of research which shows that if you go beyond 100%, your storage needs then go down exponentially. This is crucial because storage is the most expensive part of the system.
Earlier this year, the International Energy Agency (IEA) published a landmark report which brought together some of this research.
The new technical report was released by the IEA’s Photovoltaic Power Systems Programme (PVPS). Experts involved in the IEA PVPS include delegates from Australia, Austria, Belgium, Canada, Chile, China, Denmark, Finland, France, Germany, Israel, Italy, Japan, Korea, Malaysia, Mexico, Morocco, the Netherlands, Norway, Portugal, South Africa, Spain, Sweden, Switzerland, Thailand, Turkey, the US, the European Commission, Solar Power Europe, the Smart Electric Power Alliance (SEPA), the Solar Energy Industries Association and the Copper Alliance.
The report, released in February, synthesises a wealth of peer-reviewed scientific research by multiple research teams. Most of the research has been led by Marc and Richard Perez of Clean Power Research.
The nearly two dozen papers published from 2013 until 2022 are summarised in the IEA report, titled Firm Power Generation. It shows that solar, wind and batteries can supply clean power 24 hours a day all year round “almost anywhere on the planet”, and are “capable of entirely displacing all conventional sources economically”.
The case studies in the report focus on different regions of the US, Europe and Australia. All of them reveal the key features that renewable energy systems need to become both least cost, and capable of providing continuous power.
But the most crucial one is what the report calls ‘implicit storage’. The report explains this as follows:
Most importantly – and counter-intuitively – the variable-to-firm transformation entails overbuilding and proactively curtailing the VRE [variable renewable energy] resources, a strategy also known as applying implicit storage… Overbuilding is defined as building more VRE resources than would be needed to meet load requirements on an energy basis. This overbuilt resource is then dynamically curtailed when there is excess VRE production (when production exceeds demand and storage reserve are full).
Implicit storage, according to the IEA, means ‘overbuilding’ solar and wind generating capacity - in most cases by at least three times existing demand. This then permits the quantity of storage to be reduced dramatically (by as much as 90%).
Real storage – whether in the form of electric batteries or another form of storage – is the most expensive component of the system. So by ‘overbuilding’ or ‘supersizing’ the amount of energy being generated via solar and wind, we can reduce the amount of ‘real storage’ required, thereby massively reducing the system costs. This is portrayed in the report with the following diagram:
The green section which comes under ‘implicit storage’, is created by ‘overbuilding’ the amount of solar photovoltaics (PV). The more that’s built out, the less ‘real storage’ you need. You then ‘curtail’ the excess electricity that you don’t need (which basically means deliberately reducing the output). How does this work?
Firstly, you have a variety of renewable energy sources, not just one. So solar and wind are complementary and in most regions we find that they will compensate for each other a fair bit.
Secondly, you need good geographic dispersal. This approach doesn’t work for, say, one solar plant for a single household. It works across a much wider regional system, where the most resources can be harnessed, and which will allow surplus energy to move from one area to another as needed when there are shortfalls.
Thirdly, you need a smart and well-connected grid which can intelligently manage the flow of energy from these variable renewable sources into the system, across the whole system – based on fluctuations in demand.
Super power instead of curtailment
Yet there is good research showing that the IEA concept of ‘implicit storage’ is too limited. Why ‘curtail’ the excess electricity when it can instead be put to use?
Implicit storage as defined by the IEA PVPS assumes that we should systematically eliminate excess electricity. But if the system is supersized to generate around 3 times current demand, that’s a huge amount of surplus electricity produced at ‘zero marginal cost’.
Zero marginal costs means producing additional units of electricity will not require additional costs, so in effect the cost of those units is zero. Once a renewable energy system has been built, it will not only recoup the costs of building it within between 1-4 years, it will last for as long as 30 years. That means for most of the lifetime of a supersized renewable system, it is producing 3 times as much energy as today, for free.
A number of researchers have pointed out that such excess electricity should be used in new applications, not curtailed.
In 2013, a team of Stanford University scientists published a paper in the Royal Society of Chemistry journal, Energy & Environmental Science, discussing the Energy Return On Investment (EROI) implications of curtailment. One of their conclusions is that societies can make active use of excess electricity for key services, such as wastewater treatment, desalination or irrigation:
It is also worth asking the question: are there other uses for electricity generated by wind or solar that would otherwise be stored or curtailed? For example, excess electricity could be used in applications where the need for on-demand power is low and are not strongly disadvantaged by intermittency, for example, desalinating or purifying water or driving irrigation pumps. These conditions could result in high EROI grid values with benefits to society that lie beyond the power-grid sector. Further research in net-energy analysis and other perspectives, including economics and environmental stewardship, should explore additional and alternative uses for energy slated for curtailment.
In 2020, a landmark report by RethinkX, Rethinking Energy 2020-2030: 100% Solar, Wind, and Batteries is Just the Beginning, took these conclusions further. The report found that the most optimal and least cost designs of renewable energy systems would involve building out solar and wind generation capacity by three to five times demand, which would permit a huge reduction in battery storage requirements.
This design, applicable across climates in most populated regions in the world, would produce huge amounts of surplus power output on most days of the year – overall as much as three to five times the amount of energy being produced today:
One of the most counterintuitive and extraordinary properties of the new system is that it will produce a much larger amount of energy overall, and that this superabundance of clean energy output – which we call super power – will be available at near-zero marginal cost throughout much of the year in nearly all populated locations.
Instead of seeking to curtail this excess electricity, the emergence of ‘super power’ will enable the electrification of numerous sectors and industries:
Examples of super power applications include electrification of road transportation and heating, water desalination and treatment, waste processing and recycling, metal smelting and refining, chemical processing and manufacturing, cryptocurrency mining, cloud computing and communications, and carbon removal.
Such superabundant zero marginal cost electricity will potentially transform heavy industry by providing unprecedented opportunities to eliminate exorbitant fossil fuel energy costs and inputs.
Sector and transborder interconnections
The other important approach to increasing the efficiency of renewable energy systems is to make sure they're interconnected across sectors and borders.
Traditionally, electricity, heating, cooling, transport and industrial consumption are completely separate sectors. The idea of ‘sector coupling’ entails integrating these sectors and as much as possible converting them to electricity so that energy can move fluidly across sectors. Studies have shown that the combination of mass electrification and sector coupling can accelerate the transition to 100% renewable energy, while reducing electricity costs so they are significantly cheaper than today.
Another complimentary approach is to pursue trans-border grid connections to facilitate the transmission and sharing of energy between constituencies, nations and even whole regions and continents.
A research paper published in 2021 by scientists at the University of Birmingham’s Department of Electronic, Electrical and Systems Engineering, showed that we can create a globally interconnected electricity grid using Ultra High Voltage Direct Current transmission. In this scenario, energy could be rapidly shared and transmitted across borders in an intelligent way depending on fluctuations in demand. Such a global, interconnected grid would allow for energy to be shared across nations and regions based on differing needs at different times.
This particular study did not take into account the possibility of supersizing generating capacity as a way to solve intermittency. Even so, it found that battery storage requirements globally could be reduced by as much as 50% purely through global electricity grid interconnections.
What happens if we do both? In the context of supersizing solar and wind capacity – which can reduce storage requirements by as much as 90% - this means that the combination of supersizing and global interconnection of the renewable energy system could potentially reduce storage requirements to near zero. This means that the need for storage, while important during this transition phase while the system is still being built, could become less critical as the system is more fully developed and optimised on a global scale.
Circular economy and carbon sequestration
The importance of supersizing the build out of solar and wind, then, cannot be overstated. Supersizing is the key to reducing the most expensive and materially-intensive system component: storage. It’s also the key to creating a system of clean energy superabundance that can dramatically reduce the costs of a ‘circular economy’ in which materials are perpetually recycled.
With a system producing at least three times current demand – research by scientists at the Swiss Federal Laboratories for Material Science and Technology shows that supersizing the system on a global scale could produce as much as ten times current demand – there will be a large amount of surplus electricity which can be used to power diverse new applications including the circular economy.
Given that after 30-50 years degradation rates in the current system will require it to be, ultimately, fully replaced, that will of course require new material inputs. However, in a system generating considerable ‘super power’ at near-zero marginal costs, it will be possible to cheaply and cleanly power the new energy intensive industries involving the stringent recycling of materials. So rather than requiring massive new mineral and materials inputs, by repatriating heavy industry, manufacturing and recycling over to ‘super power’, a circular economy becomes cheap and feasible to an unprecedented degree that would be impossible within the current fossil fuel dependent system.
The studies by the Swiss scientists also show that such zero marginal cost clean energy superabundance will make currently expensive and futile carbon sequestration technologies such as direct air capture economically feasible, by powering them using ‘super power’.
Stabilizing the climate in the long run, it is necessary to reduce the atmospheric CO2 concentration down to below 350ppm. Solar overcapacity is ideal for this task, operating DACS [direct air carbon capture and storage] during peak sun hours and summer, when idle capacity is available.
So our best hope of extracting ourselves from the climate danger zone – which we are likely to move into in any event – is in accelerating and optimising the clean energy transformation along the design paths described here, so that once fossil fuels are completely displaced, we can not only eliminate fossil fuel emissions, we can begin accelerating the drawdown of carbon from the atmosphere.
An unprecedented possibility space for shared abundance
This research shows that there are optimal pathways for the design of a global clean energy system – but those pathways require sound decision-making at every step of the way. These are not decisions that will happen automatically, or that are necessitated by technology; while the nature of these technologies suggest far more networked design pathways, their optimal deployment will require decisions rooted in values and ethical commitments which fundamentally favour humanity’s harmonious relationship with the earth.
The emerging system, with the right choices, will be capable of producing more energy than we produce today in the fossil fuel system, at near-zero marginal costs for at least three decades. Unlike fossil fuels which are inherently centrally controlled and tend toward monopolies, the very nature and design of renewables, especially solar, is conducive to decentralised ownership by individuals, households, communities, businesses, towns and cities.
This abundant clean energy will be intelligently shared and managed between households, communities, nations and regions through global interconnections. In this global system, energy will not be monopolised but distributed across borders and boundaries.
As the system once built will last for decades, this means that instead of the constant increase in material throughput associated with the fossil fuel system, and as new material inputs won’t be required for the continuous generation of electricity during the lifetime of the system, material throughput will dramatically decline. Even the material inputs and mining necessary for the new technologies are dramatically lower (300 times lower to be precise) than the fossil fuel system.
If we make the right design choices to leverage super power to create a truly circular economy for the reuse of materials, this system will also enable its own self-renewal because with the electrification of all heavy industry and manufacturing, the creation of new solar and wind generation capacity as well as battery storage will be feasible using ‘super power’ that can also support the circular economy recycling of materials.
So this will be a system which, for the first time in human history, will be able to provide abundant energy for all, collectively and intelligently shared on a global scale, on a larger scale than before, with material throughput dramatically decreased.
This is not a system whose dynamics can be captured using conventional binary metrics and definitions we use today. It fits neither the conventional definitions of GDP growth, nor concepts of degrowth. In fact, it reveals that the fundamental structure of the global economy will have to transform as the new energy system is deployed, increasingly decentralising ownership over energy production. The values and worldview that will work best with this system will be premised on cooperation, compassion and human unity.
However, this optimal system will not emerge automatically. As I pointed out in a previous post, if left to its own devices, the emerging global solar system will be neither zero carbon, nor well designed, and therefore could end up being far more expensive than it needs to, while not really solving the climate crisis (with evidence showing we could be heading for a minimum of 2C). Amidst the mass economic disruption of fossil fuel industries becoming stranded assets, the new system might outcompete the old and displace it without however being properly deployed. This could lead to a suboptimal system that is vulnerable to both economic and ecological collapse.
The first step is to understand what's really possible. The scientific research discussed here shows how we can create a truly sustainable and prosperous energy system that can empower us to eliminate energy poverty while restoring climate stability. Armed with this recognition, we can begin working together to accelerate, maximise and distribute the benefits of the next energy system as it emerges.
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