Third Industrial Revolution

A big day for the Forum yesterday. Together with the Energy Institute at UCL and the wonderful WHEB Partners (cleantech investors and fund managers), we helped launch an important new book, The Third Industrial Revolution by US author and campaigner Jeremy Rifkin.

It’s a catchy title. With nifty political opportunism, Secretary of State Chris Huhne has already latched onto it, calling for “a third industrial revolution every bit as profound as the first two”. 

The first Industrial Revolution was all about coal, steam, railways, mass production and so on. The second Industrial Revolution was all about oil and the profound transformation that this had on human civilisation.

The third Industrial Revolution will be all about the transition from fossil fuels to solar energy, from centralised energy generation to distributed energy generation, from liquidating natural capital to provide economic growth to learning to live off the income flows from that capital. 

So is this the moment where a revolution of this kind really begins to get traction? It nearly did back in 2008, when world leaders announced hugely ambitious billion dollar ‘recovery programmes’ investing in smart grids, renewables, clean tech, electric vehicles and so on. But three years on, we now know that only China and South Korea got anywhere close to investing the sums promised. The rest of them (including the UK, of course) just bottled out.

To be fair, getting really serious about the green economy is a tough call. Jeremy Rifkin himself acknowledges that the current lack of political will in most countries (let alone in his own country!) is daunting. Despite that, the renewables revolution would appear to be seriously underway. By any indicator you care to use (installed capacity, innovation pipeline, improved efficiencies, reducing costs, level of investment, scalability, political support etc), there’s a stir out there in the US, Europe, China, India and post-Fukushima Japan that is creating new benchmarks for investors and generators alike. Farewell niche player; enter the single-most significant technology revolution going on anywhere in the world today – and that includes all the usual IT-hype.

In other respects, progress is a lot patchier on the other ‘pillars’ on which Jeremy Rifkin builds his vision of the third Industrial Revolution.  The five pillars are:

1. Renewable energy itself
2. Retrofitting our existing building stock – both domestic and non-domestic
3. Storage technologies (from improving the humble battery to hydrogen-based systems)
4. Smart grids (facilitating the emergence of an ‘energy internet’)
5. The electrification of ground-based transport – cars, buses, trucks and so on.

Rifkin’s book does us all a great favour. For those who argue that the Green Movement has no alternative vision, offer them the Third Industrial Revolution. For many, I expect it will still be too technology-dependent, but for the vast majority of decision-makers today, trapped as they are in the collapsing paradigm of the second Industrial Revolution, this could just be the spur to free them of their oil-drenched illusions.