“If I had asked the public what they wanted they would have said a faster horse.—Henry Ford

It’s easier to count the people who don’t own smart phones versus those that do. The phone that fits so neatly into your hand (and probably never leaves it!) has 100,000 times more processing power and over seven million times more storage than the Apollo 11 computer that brought the first earthlings to the moon in 1972.  If you predicted these advancements back in 1972, you’d more likely find your views published in “The Magazine of Fantasy and Science Fiction” than “Scientific American”.



Image: NASA engineers operating IBM System/360 Model 75 mainframe computers.

The transition to renewable energy relies heavily on innovation, and this means history is on our side. Humans are ingenious, having dreamt up, created, and improved upon many previously hard-to-imagine things.  The wheel is one of those amazing inventions. Later, someone else thought of attaching it to an axle, and our ability to transport ourselves and heavy objects over land was forever altered. While no match for today’s internet, the invention of the printing press enabled much faster and wider dissemination of knowledge, which allowed the mechanics of older machines to play a key role in the development of new machines. The internal combustion engine ushered in the Industrial Age. Fast forward to today, where the sum total of prior human innovation and achievement helps explain the incredible speed and efficacy of the Covid-19 vaccines, a testament to human’s ability to solve big problems quickly.

So just like the wheel was greatly improved with the axle, technology innovations in renewables are seldom stand-alone. The International Renewable Energy Agency (IRENA) outlines four broad categories of innovation required to transform the electric power sector towards net zero. These integrated innovations go well beyond just technology, embracing business models, market design, and system operations.

Innovation Dimensions

Enabling technologies like electric vehicles, battery storage, and solar panels get most of the public’s attention because they’re both “cool” and you can own them.  Seldom understood technologies like blockchain, artificial intelligence, big data, and super grids also play a large role in the transformation of the grid. Completely behind the scenes though equally important are the evolution of business models, market design, and system operations. (Increasing the time granularity in electricity markets, while super nerdy, is essential to improving energy efficiency.)

All of these innovations – whether high profile like Electric Vehicles (EVs) or behind-the-scenes like advanced forecasting of renewable power generation, have contributed to the 90% decline in solar generation costs, the 80% decline in wind generation costs and the 77% decline in battery storage costs in the past decade.  As investment capital pours into renewables, we have no reason to believe the pace of development and innovation will slow in the decades ahead.

As has been the case throughout history in solving big problems, innovation’s contribution to de-carbonization will likely exceed expectations. Those of us who are disappointed that we aren’t (yet) flying around in jetpacks will be handsomely rewarded for our optimism in humankinds’ genius and willpower when it comes to solving the challenges of climate change.

Renewables Roundup.

U.S. and China Agree To Cooperate On Climate Change


Emerging Market Green Debt Sales To Soar Past $100 Billion


World Adds Record New Renewable Energy Capacity In 2020


JP Morgan and Citi Pledge Multi-Trillion Dollar Green Finance Projects


Nextera Energy To Buy Wind Assets From Brookfield Renewable In $733M Deal


Facebook Hits Key Climate Goal


Amazon Orders Wave Of Renewables Projects


*No Warranties. The accuracy and/or completeness of any Eagle Global Advisors index, any data included therein, or any data from which it is based is not guaranteed by Eagle Global Advisors, and it shall have no liability for any errors, omissions, or interruptions therein. Eagle Global Advisors makes no warranties, express or implied, as to results to be obtained from use of information provided by Eagle Global Advisors and used in this service, and Eagle Global Advisors expressly disclaim all warranties of suitability with respect thereto.

You Must Make Your Own Investment Decision. It is not possible to invest directly in an index. Index performance does not reflect the deduction of any fees or expenses. Past performance is not a guarantee of future returns. You should not make a decision to invest in any investment fund or other vehicle based on the statements set forth in this document, and are advised to make an investment in any investment fund or other vehicle only after carefully evaluating the risks associated with investment in the investment fund, as detailed in the offering memorandum or similar document prepared by or on behalf of the issuer. This document does not contain, and does not purport to contain, the level of detail necessary to give sufficient basis to an investment decision. The addition, removal, or inclusion of a security in any Eagle Global Advisors index is not a recommendation to buy, sell, or hold that security, nor is it investment advice.