The battery revolution will spur fundamental changes in society – and bring new problems.
Analysts expect that the traditional electric grid will continue to play a crucial role for decades to come. But in parts of Europe, decentralized power production is already undermining centralized generation, and the same could happen in the United States. The question is, Who will pay to maintain the grid as more consumers defect? If wealthier people go off the grid first, the less well-off may be forced to underwrite the power plants and lines that remain.
In the coming decades, tens of millions of utility customers will find solar-plus-storage systems to be as cheap as or even cheaper than the electricity they buy from the grid, according to the Rocky Mountain Institute, a Colorado-based nonprofit that promotes renewables. In the Northeast alone, roughly 9.6 million residential customers could shift to grid-connected solar-and-battery systems by 2030, RMI estimates. That represents half of the region’s residential utility sales, worth about $15 billion in revenue.
“There’s a real risk that everyone’s making capital investments and nobody’s talking to one another,” says James Mandel, a principal at RMI, who urges more coordination between utilities, grid operators, and small-scale producers.
In transportation, an exodus from gasoline-powered vehicles would have significant geopolitical implications. Oil is a cornerstone of the world economy – making up nearly a third of energy use. Even a slight change in supply or demand can upend producer-consumer dynamics. The recent oil-price collapse has strained the already fragile economies of Russia, Iran, Venezuela, and other petrostates. Cheaper electric cars would drive down oil demand even further.
Another risk of transitioning to a battery-powered world is that it could lead to swapping dependence on fossil fuels for dependence on lithium, cobalt, and other metals critical to advanced batteries. While supplies of these elements are plentiful for now, the long-term outlook is less certain. Many of these materials are also concentrated in certain countries – Chile, China, and Australia, for instance.
That’s why some say it’s important to develop a diverse portfolio of battery technologies: Nobody wants oil cartels to be replaced by lithium cartels.