Why new energy is key to innovation

Today, a lot of energy is lost in complexity. New energy in all forms – physical, mental and creative – is the key to innovation.

The past, present and future of energy are riddled with misconceptions. In all its different forms, energy is a key force of life. In general, it’s good to have and use more energy, not less. This is easy to grasp when we’re talking about mental or creative energy. For physical energy, things aren’t so clear in the midst of a climate crisis. However, even the UN Sustainable Development Goals have goal 7, which is about “ensuring access to clean and affordable energy, which is key to the development of agriculture, business, communications, education, healthcare and transportation.”

Of course, there are always certain boundaries. As human beings, we need a finite amount of nutritional energy – if we get too little or too much, it leads to health problems. The Neolithic Revolution, as well as the Green Revolution, were about more efficient ways of providing nutritional energy, making larger populations possible. The Industrial Revolution was about new ways of manufacturing, based on new forms of fossil energy. As Tomas Pueyo put it,

humanity has made huge steps forward every time it has found a new way to harness more energy: animal husbandry, watermills, sails, coal…

If we want humanity to move to the next level of progress, we need to increase the energy we harness. Energy is good. What’s bad is doing it in a way that has serious costs.

This is often misunderstood, deliberately or not. The energy use per capita in the US has stagnated for 50 years now. This could be a good thing, if it meant economic growth decoupled from energy use. But this plateau also coincides with the Great Stagnation of US productivity. In other words, the US economy as a whole is still growing, but productivity is not increasing. While the US doesn’t need more energy per capita, it’s not getting more productive either.

Energy intensity

But there is another point of view here, and it’s about energy intensity. We certainly can (and must) use energy much more efficiently than we do today. Heat pumps, for example, take one kilowatt-hour of electricity to produce three to four kilowatt-hours of heat. There is a huge potential in electrifying everything. Our current ways of energy production have serious consequences for the world’s ecosystems, so we absolutely need to change them. Tomas Pueyo again:

What’s good about less energy consumption per person is that it means we pollute less. But this is forcing us to make an unfortunate tradeoff between using energy and the environment. It reduces our flourishing for the sake of sustainability. What if we didn’t need such a tradeoff? This is what the future of energy will need to deliver.

With solar, wind, and nuclear energy, we already have the technologies for the 21st century. With electricity, we have the perfect intermediary. The missing link is storage, but there are a bunch of possible solutions: better batteries, demand-side management, hydrogen and its derivatives, and even solar-to-methane (here is the science behind it, and here is a start-up doing it).

Having more abundant and cheap energy is key to all kinds of uses that today aren’t feasible. With water desalination, for instance, we could reclaim the Sahara. Spatial computing, augmented reality, or the blockchain all strive for their piece of the energy cake. Having more energy available at cheaper prices will unleash a lot of innovation. AI, of course, is energy-hungry as well.

A growing sense of urgency

Adding AI to, well, everything will change everything everywhere all at once. There is a growing sense of urgency that doesn’t sit well with our societies, burdened as they are with polycrisis and permacrisis. In our personal and professional lives, we feel exhausted from the impositions of the recent past and the present. And we face – and expect – only more of it, while our ability to adapt is depleted.

This, combined with the digital outrage machine, opens the door to right-wing populism. Aversion to change and a promised return to the good old days (that weren’t so good in truth) are messages that resound well with people who already lack the mental energy needed to cope with the key challenges of the times. And make no mistake: democracy comes with its own set of impositions.

Power to the people, that old rallying cry, is a double-edged sword. People can and will vote for ugly political parties and candidates. 2024, the global super-election year, harbours the potential for nasty surprises that aren’t all that surprising. Increasingly, corporations feel the need to position themselves in the political sphere – at the risk of alienating huge parts of their consumer base.

All this results in an explosive brew. There is a lot of disruptive energy waiting to be discharged. People strive for self-efficacy, and will they be careful in their choice of means? The escalating protests by German farmers, but also the recent strikes, remarkable by German standards, look like bad omens.

Various social groups are fighting for their slice of a pie that is not growing and which, thanks to immigration, has to be distributed among more and more people. This is not to say the country needs less immigration, quite the contrary:

With de facto full employment in many countries and the retirement of the baby boomers, migration is the way to keep the country up and running.

New political energy

But in other parts of the world, the pendulum is swinging the other way. In the UK, its flirtation with right-wing populism from Brexit onwards looks set to come to an abrupt end, with all the polls pointing at the left-wing Labour Party returning to power with a landslide bigger than Tony Blair’s back in 1997. Could new government inject new energy into British politics?

Climate campaigners, too, are finding new energy for their stories. Acknowledging that pure doom and gloom messaging – however justified – tends to provoke as much backlash as change is a necessary step. Just look at the levels of misinformation circulating around something as innocuous as electric cars. People’s unease with change is something we’ve encountered again and again in the digital transition – and now we’re hitting it in the energy transition, too. But we know the answer, too: sell people a positive vision of the future. A vision that inspires them, not scares them.

Climate narratives are finding new energy in emerging narratives around Solarpunk and Rewilding, selling positive visions of the world post-transition rather than bleak dystopias if we don’t act. Harnessing energy towards positive change, rather than in service of regressive politics will be a critical skill in an unsettling decade.

Homemade problems, false starts and a lack of positive energy

Of course, the general mood can and will improve with the weather over spring and summer. Oddly enough, the UEFA Euro 2024 in Germany can play a pivotal role here. If things go well, we’ll see a second summer fairytale along the lines of the 2006 World Cup. If not, well… It’s a big burden for national coach Julian Nagelsmann. After the humiliation against Austria last year, he diagnosed homemade problems, false starts and a lack of positive energy.

Sounds like a political analysis. We could easily apply the same verdict to Germany’s governing coalition. While the physical energy crisis after Russia’s invasion of Ukraine has been solved quickly, the country suffers from a severe creative energy crisis. In an interview, futurist Amy Webb expressed her concerns about Germany:

It’s a paradox that Germany is home to some of the most important companies in the world, be it in the automotive, aerospace or science sectors. But at the same time, I see very little innovation. I’ve always wondered about that.

The reason?

I think security, development and processes are over-emphasised.

In her view, Germany has no vision. And what’s more:

There are still many silos in companies. They can be broken down using various methods, but change must always be driven from the top. Without that, there is no innovation.

So, there are systemic issues at play. A lot of energy is lost in complexity. Overly complex systems slow down innovation and hinder creative energy from flourishing. The past decades of digital transformation haven’t paid off. Technology has added another layer of complexity, but where are the results? Corporate silos still exist as if nothing has happened.

This country needs new energy

The tech giants – Microsoft, Apple, Nvidia, Amazon, and Alphabet/Google – are each worth more than $1 trillion. Alphabet alone, currently at no. 5, has a higher market cap than the German DAX 40 combined. Even a company like Adobe, which makes money through enterprise software, is valued higher than SAP, the leading DAX company. German industry pays a kind of tech tax to the giants.

This country, amongst many others, definitely needs new energy, in all of its forms. Maybe it’s a good sign that coach Julian Nagelsmann has now dared to break with the past. Innovation is closely linked with disruption. So far, the German traffic light coalition hasn’t really departed from the Merkel years, despite the Zeitenwende rhetoric:

The Zeitenwende (turn of tide) proclaimed by chancellor Olaf Scholz in late February [2022] begins on the ruins of the previous policy. There is now a huge opportunity to get rid of self-deception and start with a fresh, systemic look at challenges and opportunities.

Two years later, this opportunity is lost. The coalition is muddling through as if nothing has happened.

New energy: literal and figurative

But it’s seductively easy to look at the problems, and forget to celebrate the successes. Germany, at least, can celebrate its energy transition – a key project of the government. With a share of 56.0%, most of the electricity generated and fed into the grid in 2023 came from renewable energy sources. In 2022, the share was still just 46.3 %. And what’s more: Germany now even seems to be on track to reach the 2030 climate targets. In this respect, at least, we are well on the way to the new energy we need.

Other countries are not doing as well. The UK generates 47.3% of its energy from renewables, and boosting that looks like an easy and early win for an incoming government. France generated just 24.5% of its energy from renewables in 2022 – although a large base of nuclear means its emitting less carbon than that might suggest. The USA is languishing at just over 20%. Germany has a good, and inspiring story to tell here.

Perhaps, more than anywhere, where we really need new energy is in our storytelling – our marketing. If we’re to navigate our way through the polycrisis, we need somewhere to head. A solarpunk future is more enticing than a hair-shirt one. Micro-generation of power and local self-sufficiency in renewables are powerful counters to the populist narratives – and can generate genuine excitement.

And with the recent results of Julian Nagelsmann’s team, excitement is building up for the home Euro in summer as well. We’ll take new energy wherever we can get it.