The coming “intergrid”.

The always interesting Bill St. Arnaud pointed me in the direction of this interesting speech by Jeremy Rifkin who talks about the convergence of a quantum advance in communication and energy technologies leading to a “third industrial revolution”. Clearly talk of the “smart grid” is not new and we may actually be well on our way to the “peak of inflated expectations” but this does not take away from the much much bigger picture that this convergence will be fundamentally transformational:

The same design principles and smart technologies that made possible the internet, and vast distributed global communication networks, will be used to reconfigure the world’s power grids so that people can produce renewable energy and share it peer-to-peer, just like they now produce and share information, creating a new, decentralized form of energy use. We need to envision a future in which millions of individual players can collect, produce and store locally generated renewable energy in their homes, offices, factories, and vehicles, and share their power generation with each other across a Europe-wide intelligent intergri

And although it is probably too early for us, I am extremely optimistic about the very exciting investment opportunities I see coming down the pipe because of this revolution. No we aren’t planning to add to or change the investment focus of Nauiokas Park to green tech or clean energy. What I am alluding to is the opportunities that will emerge to create new markets, market structures and participants when the world’s energy becomes a truly networked, digital commodity. Imagine a world (not so many years away) where tools like Google PowerMeter are as widely adopted as Google Search or Skype. And distributed micro-generation (solar, wind, micro-generators, etc.) and micro-storage. All connected, all digitized. Generating vast amounts of data and transactions. And you’ve got yourself a market. Sure, I here you say, energy markets already exist and by the way are pretty big. No big deal here, move along. Well, it’s not perfect but I would suggest comparing the financial markets of the 1970s to the financial markets of today, to get a sense of the quanta of change we should expect in energy markets – with the concomitant risks and opportunities this will present. And I suspect it will all happen a bit more quickly: one decade instead of three(?)

I hope we’ll have the opportunity to invest in the Weatherbill of power markets. Or the Aleri of power trading. Oh wait – we’d better hurry(!): “Home Energy Programs Getting Smarter With Software”

I know it’s not the done thing, but despite all the doom and gloom I can’t help but to get more optimistic every day about all the truly exciting opportunities that are bubbling up in harmony with the new industrial and economic paradigm that is dawning. (Which is not to disagree with the doom and gloom – for those people, companies and industries stuck in the old paradigm there isn’t much to cheer about, and it must be especially galling for those who were leaders in this old world order.)

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