A few weeks ago I was thrilled to speak at the inaugural Summer Institute on Sustainability and Energy, organized by the University of Illinois-Chicago in partnership with Argonne National Laboratory, Northwestern University, Illinois Institute of Technology, and the University of Chicago. The students were from diverse fields and between them and the other speakers I learned a lot (including some cool vertical farming design!).
My talk focused on the history of the electricity industry, the economics of the industry and of its regulation, and how technological change is changing the economics of the industry and making its regulation maladaptive. When thinking about the history of electricity through the lens of technological change, I like to start with lighting, because better-quality lighting was the primary consumer objective toward which entrepreneurs and innovators were driving electricity technology. Talking about lighting in the 18th-19th century in the US means talking about whale oil, which was the dominant lamp fuel because of the bright clarity of its light. You can think through the rest of the story — demand for whale oil shifts to the right, prices rise, whalers have to go further and harder to catch whales from a declining population, which shifts supply to the left, which increases prices … ultimately the increase in the price of whale oil saved the whales, inducing innovators to create new lighting technologies: first kerosene lamps, and then electric lighting. That’s why when you’re thinking about the confluence of energy, why consumers use energy, technological change, and sustainability, whale oil is a good place to start.
My NU colleague Beth Herbert is the Assistant Director of Science in Society, a really good science outreach effort at NU, and she attended SISE that day and blogged about my presentation (thanks Beth!). She draws out the innovation and sustainability lesson and makes it explicit:
There was a time not too long ago when a significant portion of the American public looked to whale oil as its source of power, and the companies who procured and sold the oil were very powerful. But it was a limited resource, and fortunately we looked to alternatives (unfortunately, not entirely sustainable alternatives) before depleting the entire whale population. So the moral of the story? What you think you “need” today—say, lots of fossil fuels—might not seem so necessary in the future, if we continue to apply our creativity and innovation to finding and developing sustainable energy sources.
She also makes some other great observations, so I encourage you to click through and check out the rest of her post, and of Science and Society.
And a reading recommendation: for the history of the evolution from whale oil to kerosene lighting, and the innovation in the kerosene lamp as a great example of the innovation process, Daniel Yergin’s The Prize has an excellent chapter on the subject. The rest of the book also provides a thorough and well-told history of the global oil industry.