The town has developed more than enough energy for its own needs.  They have three GWH generating capacity.  From this they use one GWH; they export and sell one GWH capacity, which brings in millions of dollars to its tax base, and use the other GWH as incentives.  The residents who bought into the coop get dividends and rebates from this as well as eliminating their power bill.  Due to recent economic changes, the town decided to attract companies with high wage jobs with very attractive rates to the company on power, subsidies and land use.  The city issues bonds backed and guaranteed by the MWH sales contracts that it has developed with buyers.  These bonds are used for infrastructure, arts, and general welfare.

An unleashed distributed power network could see enormous growth in energy.  With an annual growth rate that is very moderate by internet standards, we could see:

• double installed electricity capacity by 2020 and double again by 2030.
• cut pollution 50 to 90 percent from present levels
• cut out all oil imports to a negligible level and start to export energy again.

Look at how the internet has evolved. In the 1980’s and early 1990’s few people could imagine the huge amount of products that the internet would spur. Even in just the past five years, the change has been enormous.

Here are some of the key drivers.

Chips:  The number of micro chips produced each year is growing exponentially, and costs are dropping

1.2  Cost per watt, Tech Cost curve

Communication:  Now there are over one billion people on the internet, and if we add in smart phones, half the planet is connected.  The other trend is the internet of things – pipelines, shipping containers, trucks, and cars

Smart:  With all these chips and the communications, we have ever more sophisticated software to manage the whole system.  The systems are getting intelligent.

Technology advances lead to cheaper and better.  An example is the cost for solar energy.  The cost of production is dropping steadily.  These trends point to a future that has an abundance of energy.

If there are technical or social breakthroughs in solar and wind energy, they will crowd oil, gas and coal out of the mix.  Think about the photo industry.  Kodak is a 131 year old company and now it is seeking protection from bankruptcy.  They failed to adapt to the digital camera industry until it was too late.  Of course, ten years ago why should Executives at Kodak care about digital cameras?  They were no threat.  Digital cameras were very expensive back then costing in the thousands.  Who could afford such luxuries in the 90s – no matter that digital photos are free, while film photos cost money to buy and process.  Once a tipping point for digital photos hit, then they took 99 percent of the market from cameras that require film and processing.  Given time and the trend in technology, we will see the same when there is a breakthrough in solar or some other form of energy.  Perhaps we are ten years away from a similar shift due to solar, batteries or whatever.   Solar fuel is free; oil and gas cost money to get, distribute and use.

With the power of such high growth, the biggest deterrent is government involvement, special interests and jackals. The best thing the Government can do is to allow the entrepreneurial spirit to flourish.   The second best thing governments can do is to provide incentives and tax breaks.  Even tax the bad fuel to spur on the good.

In telecom and information technology, the advance is advancing steady and rapid.  Things we can do in 2010, which would be difficult or expensive in 2000:

•             Scale of the system in the tens of millions of nodes.

•             Millions of computers talk to each other automatically.

•             Energy producing machines (wind, solar, generators, etc) can talk straight to computers on a large scale.

•             The whole process should operate seamlessly so users do not care how the transactions happen and should be as simple to operate as possible.

•             System is fault tolerant so if one part of the network goes down, then the others can take over and make sure things happen as they should.

•             Security is strong and not allows hackers or fraud to disrupt and defraud any of the participants.

•             Authentication in place at every point on the network. Most of this is built into the various nodes such as energy devices batteries and smart meters.

•             Passwords, digital certificates, smart cards, and biometrics tie into the system.

•             Identity must be confirmed between the parties and all devices using any or a combination of biometrics, tokens, smart cards and online tools.

•             Detailed accounting for the transactions is handled locally or centrally.

•             Billions of micropayments are collected and dispersed.

•             Data Integrity.  Every resource has metadata for identification and transactions.

•             Priority data. Who is higher in the hierarchy, and who must listen to whom. Then also some conditions in place

In energy, we are still using old technology.  If you open old edition of ‘Home Power’ magazine, or automobile magazines, you will not see many big breakthroughs, but there is a lot of innovation and experimentation now.  Perhaps this decade we will see thousands of new products related to energy – invent, adopt, implement.  There will be a lot of experiments and many solutions will be a series of one-off inventions instead of a big leap.  Chargers for cars will connect, then that will be enough.  Maybe some breakthroughs will happen.  You see the white strips on all those asphalt roads?  Someday some brilliant scientist will figure a way for those to collect energy and with millions of miles of those will be enough to power every car in the country.  Cars become dual purpose and act as home power plants.  Hundreds of thousands of jobs created to retrofit homes and buildings to charge electric cars.  New kits are made that will load up electricity slowly, and fast charge cars.  New products like home integrated batteries that look like bricks, non-poisonous batteries, battery integrated appliances – refrigerators, etc…

It is our opinion that the big breakthrough will come with low voltage, mass market innovations.  Homes and cars will store energy, small generators will be mainstream, and all this will be tied together into peer to peer networks.  These networks will communicate and deliver energy to neighbors directly in a peer to peer manner.  Peer to Peer Electricity – not Smart Centralized Controlled Power!

1.1 Energy and GDP

Technology will drive breakthroughs that make local power generation cheaper and more convenient.   Low cost battery, low cost solar and new inventions.  Renewable energy technologies will continue to improve. In the future electric cars, hybrids, solar cells, wind, bio mass and other forms of energy will be made and stored at lower costs.   What is new is the emerging trend for individuals to become power producers and owners of the means to produce, then to share these resources with others as peers.  The benefits reach across many owners and make the overall system much more valuable.  A network of ten users will make a virtual power plant that gives back twenty times the benefit.

If stressful times bring about great innovation then the energy and financial situation in the USA is one big opportunity. Americans are extremely creative and when faced with a tough situation. They invent and build their way out of trouble. In early 2012 we have a lingering financial crisis, but we also have enormous industry, power and resources. We have installed capacity of about one million MWH of electricity power production capacity. Without breaking a sweat, Americans can double their installed energy capacity in ten years and then double it again in another ten. This book is about how to get there with no new power plants, no additional pollution, and no big government mandates or programs.