change, especially when accompanied by new
low-cost supplies of energy). Third, market factors including liberalised energy markets (this is
especially important when the fundamental cost
structures of new or incumbent energy sources
change, but these changes cannot feed through to
technology choices due to a regulated energy
industry). In addition, energy systems are prone
to shocks, and these can trigger energy
revolutions.
The technologies involved in major energy
revolutions can be considered on two dimensions. First, capital intensity. A technology with a
high capital intensity, such as nuclear power,
requires a large-scale player to deploy it, while a
technology with low capital intensity, such as
biofuels or compressed natural gas (CNG) vehicles, can be deployed by individuals. Second,
network intensity. A technology with high network intensity, such as offshore oil and gas,
requires significant investment in a network,
which is often delivered by players other than the
technology developer. A technology with low
network intensity, again such as power generation technologies, can plug and play into an
existing network, which means that the technology is not reliant on actions elsewhere in the
energy system.
In international experience, high capital
intensity and low network intensity technologies
have played a major role in energy revolutions.
These technologies are often deployed to meet
rapid changes in energy demand, such as demand
for more energy, secure energy or cleaner energy.
This is because governments often have responsibility to meet these needs, and they have tended
to favour deployment of large, established,
single-fuel technologies—such as nuclear or coal
—that can plug into existing networks.
5.1 Basics
History demonstrates that new technology can
trigger revolutionary changes in energy systems.
Over the timescale of centuries, technology has
clearly transformed the energy system. The history of the UK, the first country to industrialise,
shows this very clearly. The invention of the
steam engine in 1763 started the Industrial
Revolution, leading to increases in coal demand.
The invention of the Ford Model T car in 1908
started a period of declining transport costs,
leading to increases in oil demand. The opening
in 1956 of Calder Hall, the world’s first commercial nuclear power plant, led to increases in
primary electricity supply. These examples show
that the energy system is fundamentally based on
technology, and so major changes in technology
will be closely related to major changes in energy
systems.
Recent decades have provided plenty of reasons for technological innovation in energy. Air
pollution has become a major concern. In the
1950s countries such as the UK and the USA
passed clean air laws, and by the late 1970s
international agreements were formed, such as
the Convention on Long-Range Transboundary
Air Pollution. Energy security became a prominent concern with the oil crises of the 1970s.
Climate change reached international levels of
concern with the adoption of the Kyoto Protocol
in 1997. These imperatives, coupled with the
increasing technological sophistication of the
wider global economy, have led to high levels of
innovation activity. However, this has not
resulted in significant change in the energy system. Since the 1980s, shares of primary energy
have been relatively constant between biomass,
coal, oil, and modern energy carriers (Fig. 16).
Other factors appear to have been the trigger
for revolutionary change. These changes, while
often using new technologies, were not always
triggered by the development of these technologies. The UK provides examples of this. In 1967,
demand for clean air and warmer homes led to a
centralised decision to switch more than 40
million appliances from town gas to natural gas.
In 1984, the miners’ strike severely disrupted
coal supply chains. In the 1990s the power sector
experienced a dash for gas as market liberalisation enabled recently invented combined-cycle
gas turbine (CCGT) technology to compete for
the first time. Each of these examples revolutionised the UK energy system, but technology
had a supporting, rather than a leading, role.
Special Report 3: A Study of China’s Technology Revolution
313
low-cost supplies of energy). Third, market factors including liberalised energy markets (this is
especially important when the fundamental cost
structures of new or incumbent energy sources
change, but these changes cannot feed through to
technology choices due to a regulated energy
industry). In addition, energy systems are prone
to shocks, and these can trigger energy
revolutions.
The technologies involved in major energy
revolutions can be considered on two dimensions. First, capital intensity. A technology with a
high capital intensity, such as nuclear power,
requires a large-scale player to deploy it, while a
technology with low capital intensity, such as
biofuels or compressed natural gas (CNG) vehicles, can be deployed by individuals. Second,
network intensity. A technology with high network intensity, such as offshore oil and gas,
requires significant investment in a network,
which is often delivered by players other than the
technology developer. A technology with low
network intensity, again such as power generation technologies, can plug and play into an
existing network, which means that the technology is not reliant on actions elsewhere in the
energy system.
In international experience, high capital
intensity and low network intensity technologies
have played a major role in energy revolutions.
These technologies are often deployed to meet
rapid changes in energy demand, such as demand
for more energy, secure energy or cleaner energy.
This is because governments often have responsibility to meet these needs, and they have tended
to favour deployment of large, established,
single-fuel technologies—such as nuclear or coal
—that can plug into existing networks.
5.1 Basics
History demonstrates that new technology can
trigger revolutionary changes in energy systems.
Over the timescale of centuries, technology has
clearly transformed the energy system. The history of the UK, the first country to industrialise,
shows this very clearly. The invention of the
steam engine in 1763 started the Industrial
Revolution, leading to increases in coal demand.
The invention of the Ford Model T car in 1908
started a period of declining transport costs,
leading to increases in oil demand. The opening
in 1956 of Calder Hall, the world’s first commercial nuclear power plant, led to increases in
primary electricity supply. These examples show
that the energy system is fundamentally based on
technology, and so major changes in technology
will be closely related to major changes in energy
systems.
Recent decades have provided plenty of reasons for technological innovation in energy. Air
pollution has become a major concern. In the
1950s countries such as the UK and the USA
passed clean air laws, and by the late 1970s
international agreements were formed, such as
the Convention on Long-Range Transboundary
Air Pollution. Energy security became a prominent concern with the oil crises of the 1970s.
Climate change reached international levels of
concern with the adoption of the Kyoto Protocol
in 1997. These imperatives, coupled with the
increasing technological sophistication of the
wider global economy, have led to high levels of
innovation activity. However, this has not
resulted in significant change in the energy system. Since the 1980s, shares of primary energy
have been relatively constant between biomass,
coal, oil, and modern energy carriers (Fig. 16).
Other factors appear to have been the trigger
for revolutionary change. These changes, while
often using new technologies, were not always
triggered by the development of these technologies. The UK provides examples of this. In 1967,
demand for clean air and warmer homes led to a
centralised decision to switch more than 40
million appliances from town gas to natural gas.
In 1984, the miners’ strike severely disrupted
coal supply chains. In the 1990s the power sector
experienced a dash for gas as market liberalisation enabled recently invented combined-cycle
gas turbine (CCGT) technology to compete for
the first time. Each of these examples revolutionised the UK energy system, but technology
had a supporting, rather than a leading, role.
Special Report 3: A Study of China’s Technology Revolution
313