We care about electricity, in part, because it is a superior energy form – clean at the point of use, capable of performing many tasks, and easily controlled.  Such attributes have increased its share of total energy use over the past three decades from 25 percent to nearly 40 percent.  Electricity powers our high-tech economy, and its precision and flexibility make it critical to future growth.

We also care because electricity is so critical to our lives.  The point was made well in a 1950s movie classic entitled The Day the Earth Stood Still.  When the alien in that film tried to impress upon the U.S. military his seriousness and his clout, he decided on the one thing that would stall modern society – he turned off electric power for half an hour.

Although we’ve known about – and been entertained by – static electricity for more than 2,000 years, it’s been only a little more than a hundred years that we’ve harnessed this unique form of energy.  In the period of a single century, electricity has changed our lives.  Electric lights lengthened our days.  Electric-power elevators and streetcars heightened and enlarged the cityscapes.  Motors transformed industrial societies. 

Electricity’s Future

As we think about electricity’s future, the obvious initial question is why change the status quo?  The short answer is that traditional technologies and approaches are not sufficient for the 21^st century.  Today’s average generating plant was built in 1964 using technology from the 1950s.  Utilities have not improved their delivered efficiency in some 50 years.  With stagnant efficiency at 33 percent, two-thirds of the fuel burned to generate power is wasted.

The consequences of the system’s inefficiencies and stresses are staggering, if little noticed.  Unreliable supplies – ranging from millisecond fluctuations that destroy electronic equipment to the summer-2003 blackout that left 50 million without power – are annually costing Americans more than $150B.  To provide some perspective, this unreliable power adds more than a 45% surcharge to the cost of U.S. electricity. 

Economic Transformation

Since we cannot afford to drain away our nation’s productivity, the U.S. needs an innovative electricity system.  Unfortunately, we are falling behind our international competitors, with China, India, the Gulf States, and Eastern Europe investing in electric power infrastructure at rates that far exceed ours.  Taiwan, Scotland, Denmark, and Istanbul have grid performance and capabilities that we can only dream about.

If we get grid modernization right, the U.S. will become the center for electricity innovation, which will make it a magnet for investment, a place where high-quality businesses want to locate.  Electricity innovation, therefore, will bring about a more vibrant economy and a better quality of life. 

Richard Munson is the Director of the Northeast-Midwest Institute, a Washington-based, non-profit, non-partisan research organization dedicated to economic vitality, environmental quality, and regional equity for Northeast and Midwest states. He is the author of From Edison to Enron: The Business of Power and What It Means for the Future of Electricity and several other books.

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