The Rise of the Internet of Things and the Race to a Zero Marginal Cost Society
This essay is the second in a four-part series on the theme, “The Third Industrial Revolution.” An introduction by Arianna Huffington is available here. Part one is available here. Stay tuned for the next chapters and responses from leading global figures and technologists.
The bulk of the energy we use to heat our homes and run our appliances, power our businesses, drive our vehicles and operate every part of the global economy will be generated at near zero marginal cost and be nearly free in the coming decades. That’s already the case for several million early adopters in the European Union who have transformed their homes and businesses into micro power plants to harvest renewable energy onsite. Currently, around 25 percent of the electricity powering Germany comes from renewable energies. By 2020, the country aims to increase that to 35 percent.
The quickening pace of renewable energy deployment is due, in large part, to the plunging cost of solar and wind energy harvesting technologies. The fixed costs of solar and wind harvesting technologies have been on exponential curves for more than 20 years, not unlike the exponential curve in computing. In 1977, the cost of generating a single watt of solar electricity was more than $76. By the last quarter of 2012, the cost of generating a watt had fallen to $0.50, and by 2017 the cost is projected to fall to $0.36 per watt. After the fixed costs for the installation of solar and wind are paid back — often in as little as 2 to 8 years — the marginal cost of the harvested energy is nearly free. Unlike fossil fuels and uranium for nuclear power, in which the commodity itself always costs something, the —> Read More