Thursday, September 29, 2011

Jeremy Rifkin— Distributed Capitalism

Energy regimes shape the nature of civilizations... how they are organized, how the fruits of commerce and trade are distributed, how political power is exercised, and how social relations are conducted. The locus of control over energy production and distribution is beginning to tilt from giant fossil fuel based centralized energy companies to millions of small producers, who are generating their own renewable energies in their dwellings and trading surpluses in info-energy commons.

Distributed Capitalism

The new era will bring with it a reorganization of power relationships across every level of society. While the fossil fuel-based First and Second Industrial Revolutions scaled vertically and favored centralized, top-down organizational structures operating in markets, the Third Industrial Revolution is organized nodally, scales laterally, and favors distributed and collaborative business practices that work most effectively in networks. The "democratization of energy" has profound implications for how we orchestrate the entirety of human life in the coming century. We are entering the era of "Distributed Capitalism."

Excerpted from Jeremy Rifkin's The Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy, and the World, Palgrave Macmillan 2011.

We can quibble over numbers and the exact set of calculations, but the data I observe indicate that as of last year, we were wasting something like 86 percent of all the energy we threw at the economic process.

That means that, as an economy, we are only 14 percent energy-efficient! As one might imagine, that massive level of waste imposes an equally huge array of costs that further constrain the development of our larger economy. The five pillars in Rifkin's Third Industrial Revolution may be the only smart way forward as the synergies of each pillar lift the economy into a higher level of energy efficiency, economic productivity, and sustainability.

The good news is that many in the business and policy communities increasingly see energy efficiency as a smart, no-regrets investment opportunity for the U.S. Just one example?

It turns out that our current system of generating and delivering electricity to our homes and businesses is an anemic 32 percent energy efficient. That is, for every three units of coal or other fuel we use to generate the power, we manage to deliver only one unit of electricity to our homes and businesses. What we waste in the generation of electricity is more than Japan needs to power its entire economy! What is even more astonishing is that our current level of (in)efficiency has been essentially unchanged since 1960 -- since Eisenhower was in office.

And yet, there are larger numbers of Third Industrial Revolution technologies that can improve our performance. Combined heat and power (CHP) systems, for example, can deliver efficiencies of 70-90 percent or more, at a substantial economic savings. There is also an incredible array of waste-to-energy and recycled energy technologies that can further increase our overall resource efficiency and save us money.

My colleagues at the American Council for an Energy-Efficient Economy and I are working on an analysis showing that we could reduce our cumulative energy consumption by as much as one half even as we nearly triple the size of our economy by 2050.

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