The term energy wealth often comes up in discussions about the benefits of distributed energy. But its meaning can be nebulous.
In his new book, Abundance, Ezra Klein offers one perspective on energy wealth. He quotes the late demographer Hans Rosling, who famously grouped humanity based on having enough energy to use a washing machine. Rosling pointed out that in 2010:
- 2 billion had little or no access to electricity and relied on fire
- 3 billion had access to enough energy for electric lights
- 1 billion people had enough energy wealth for washing machines
- 1 billion had the energy to fly in planes – and they used about half of the world’s energy
Today, inequality persists, although it’s less stark. Now, under one billion of the world’s eight billion people lack access to electricity, according to the International Energy Agency. So we’re heading in the right direction.
Klein ponders what it will take to create a world that is actually “energetically wealthy.” He argues that developing abundant renewable energy is the key to greater energy equality without harming health.
No argument there.
But both Rosling and Klein’s definitions of energy wealth fall short in an era of distributed energy. They focus on access to energy, treating it as a commodity someone else owns and the rest of us buy.
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And to be fair, that’s how things generally work now — although change is afoot because the rise of distributed energy allows households, businesses and communities to own and control their energy supply.
On the US grid, ownership of distributed energy enhances energy wealth in various ways, among them by offering a way to avoid escalations in utility costs and to sell energy services to the grid. Ownership also provides more control over the kind of energy used and, therefore, its influence on health, which has financial ramifications.
It’s important to note that distributed energy is changing energy wealth for both the poorest and the wealthiest nations. California, one of the world’s top economies, has the most rooftop solar in the United States. Meanwhile, campaigns are underway to electrify poor Asian and African regions with the installation of minigrids and microgrids.
Klein says energy is the nucleus of wealth. That may be true, but we’re not fully parsing what could expand that nucleus. We’re not accurately measuring and fully defining energy wealth.
Simply being a renter of energy – having access to it – has been how we’ve measured energy wealth in the past. However, technological changes – the rise of nanogrids, microgrids, solar plus storage, electric vehicles, community solar, and other forms of distributed energy – dictate a change in the measurement. Energy wealth is no longer only about how many people can access energy; it’s also about how many people own it.