 It's a great pleasure to be back in this beautiful city that we're here all along and to be able to share with you the findings of a rather ambitious effort, the most ambitious thing we've ever attempted in our mind. We're not noted for lacking ambition. There's a work of 61 of us over a year and a half with much help from industry, on both content and peer review. I'm going to turn to you if I could go over the book again. I'll just wait for that. This is, thank you. This is a result of, say, a very graphic, some case of data rich, a reasonable business book reinventing the fire. If, by the way, you're planning to read it electronically, I do not recommend the Kindle group. We do both color and layout to understand the book, but the Google Books version is a PDF, and that's about it. I know it's a push-up piece for you. I apologize. It's in American barbaric units, as you know, we're going to be towards the metric system inch by inch. There are also conditions in quite a few other languages. It is introduced by the president of Shell Oil Company and the share of Exelot, which is the biggest nuclear-perfey of our electric company in the country. And I think it has wide applications who, other countries, are working 50 on them. And actually, in the fourth night, we will announce a Beijing and major collaboration with the leading energy arms of the Chinese government who bring this thinking into the 13th five-year plan and they're quite excited about that. We started this work by asking some big, bold questions about what if we could make energy to our work without working our own doing a matter of some interest here, where you depend on the Gulf Stream and it may just lose interest in which case you'll be living in Labrador. Could we imagine fuel without fear? Could we reinvent fire? And we chose that big poetic title because millions of years ago, fire made us human and fossil fuels made us honored. And now we need a new fire to save, secure, healthy, and durable. That turns out to be not just practical, but cheaper than what we are. So let's see how. Now, four-fifths of the world's energy still comes from burning each year, 19 cubic kilometers of the rocket remains with primeval swamp goo and dinosaur dust. As a member of the National Petroleum Council, I should tell you that it's true that those fossil fuels have built our civilization and created our wealth and enriched the lives of billions of people. But they also have rising costs to our security, economy, health, and environment. Eroding, if not outweighing their benefits, so we need a new fire. And switching from the old to the new fire means changing two big stories, oil and electricity, each of which puts two-fifths of the fossil carbon into the air. There are quite distinct stories. In most industrialized countries, almost no electricity is still made from oil in the U.S. is less than 1%. But their uses are similarly concentrated. Three-fourths of U.S. oil fuels mobility, three-fourths of U.S. electricity, powers buildings, the rest of both powers factories, so very efficient transport and buildings and factories. We'll save a lot of oil and coal and natural gas that can displace both. But today's U.S. energy system is not only inefficient, it's also disconnected, aging, dirty, and insecure. It needs repurpishment. But by 2050 it can become efficiently connected and distributed with elegantly frugal autos, buildings, and factories all relying on a secure, modern, and resilient electricity system. So we can eliminate our addiction to oil and coal by 2050 and use a third less natural gas while switching to three-fold more efficient uses and three-fourths renewable supply. That's the transition I'll be describing for the U.S. And of course, all the way through, please be thinking about the Irish analogs and differences. I think we'll find similarities that are more important to the U.S. By 2050 we found this transition could cost the United States five trillion dollars less in net present value than business as usual, counting carbon and all other external or in-costs at zero value, a conservatively low estimate. And yet this cheaper energy system could support a 158 percent bigger economy all without oil or coal or, for that matter, nuclear energy. And we also found this transition would need no new inventions and no new national taxes, mandate, subsidies, or laws, thus going around Washington to gridlock. That's perhaps the most surprising part. So I'll say it again. I'm going to tell you how to get the United States, for example, completely off oil and coal by 2050, five trillion dollars cheaper with no active congress led by business for profit. So the idea is to use our most effective institutions which in the U.S. context means private enterprise co-evolving civil society sped by military innovation to go around our least effective institutions such as the Congress. And this is a very trans-ideological approach because whether you care most about profits and jobs and competitive advantage or about traditional and rural values and local autonomy or about national security or about creation care and environmental stewardship and climate protection and public health regardless of your values in that inquiry makes sense and makes money. Now, General Eisenhower reputedly said that expanding the boundaries of the energy problem makes it soluble by encompassing more options and synergies and degrees of freedom. In other words, by including the stuff the solution requires. That's different from our usual reflex of chopping a tough problem into smaller pieces to make it bite-size. So to enlarge the boundaries of the energy problem we integrated all four energy-using sectors transport, buildings, infrastructure and electricity production. And we integrated four kinds of innovation not just the usual two of technology and public policy but also two of the powerful ones normally let out namely design the way we combine technologies and strategy new business models, new competitive strategies. Those combinations turned out to be much more powerful than the sum of parts and they create some deeply disruptive business opportunities. Where should we start? Well, the U.S. for example pays $2 billion a day for oil plus another $4 billion a day for the economic and military costs of our oil addiction. So since the biggest use of oil is auto let's start by making autos oil-free. Two thirds of the energy needed to move a typical car is caused by its weight. And every unit of energy you save with the wheels by taking out weight or drive or rolling resistance saves another six units of energy you needn't waste getting it to the wheels. So it saves in all seven units of energy at the tank huge leverage from light weighting. And yet for the past fourth century our two-ton augusts that have suffered an epidemic of obesity that gave way twice as fast as we had. But unfortunately today we have ultra-light ultra-strong materials like carbon fiber composites that can make dramatic weight savings so all and can make auto simpler and cheaper to build. Light reverse augusts need less force to move them so their engine gets smaller in fact it gets small enough you can afford to electrify the propulsion because you need two or three times fewer of those costly batteries for fuel cells. And the total purchase price of the vehicle falls to about today's level whilst the driving cost per kilometer is much lower from the beginning. And these innovations in that sequence can transform automakers from bringing tiny savings out of essentially Victorian steel stamping and engine technologies to the steeply falling costs of three closely linked technologies of ultra-light materials their structural manufacturing and electric propulsion. And if you're exploiting as an automaker three steep and synergistic learning curves whilst your competitor is out on the flat part just one you win. The sales of such vehicles can grow and the prices can drop even faster with a temporary fee bait that is rebates for efficient new vehicles paid for by fees on inefficient ones. Five such programs in Europe plus one in Singapore the biggest in Europe, the French one although it's not revenue neutral alas tripled in its first two years the speed of improving auto-efficiency and that's even before the effect of essentially applying a societal discount rate to automakers decisions about what to build could work through and change the product slate that's about 90% of the effect that's still cut. Of course for a country without an auto industry just buying them you're sort of at the mercy of what the market provides but you will certainly have buyers making very different choices if they can take a long view and look at all 15 years worth of fuel savings when they make a vehicle purchase decision rather than just looking at the first one or two or three years as they do now. So this is an important decision that is funded by Formats by the way the auto dealers will make a lot more money on the efficient units as well. Now the resulting shift to electric autos will be as game changing as shifting from small refinements in type drivers to the dramatic worst law driven games in computers. Information technology is now America's biggest industry typewriter makers advantage. So vehicle fitness opens a powerful new automotive competitive strategy that has caused somewhere between four and seven long makers to adopt it or be in force at adopting it right now along with the U.S. Department of Energy which was finally persuaded last year that rather than trying first to make batteries cheaper it makes more sense to make batteries fewer by designing the car properly. Then you sell off cars then the batteries get cheaper so the same goal will less time cost risk. Now a lot of different countries could be leading this automotive revolution. The barriers are formidable but they're much more cultural than they're technically or economic. Detroit's new leaders have been wonderfully concentrated by two bankruptcies are starting to take this very seriously for helping but actually the current leader is Germany and starting this year Volkswagen will be in low volume production of this carbon fiber 0.9 meter per 100 kilometer two seat plug-in hybrid and BMW will be in mid volume production of two models and this one and worse 40 barriers starting with the battery battery of a carbon fiber electric car they confirm that the carbon fiber is paid for by leading fewer batteries and their CEO says in speeches we do not intend to be a typewriter banker because he can look across Munich to where until 1992, Olympia used to make excellent typewriters. There are some and by the way Audi recently showed a carbon fiber plug-in hybrid concept SUV rated at 0.9 liters per 100 kilometers so it was designed 13 years ago. Seven years ago and even faster and cheaper American manufacturing technology from the spin-off I used to chair made this carbon cap in one minute and you can tell from the sound how immensely strong and stiff it is that's two thirds carbon fiber plastic but brings like a metal bell it's actually tougher than titanium so it's fast and round just don't worry about dropping it you can't do it as hard as you could with the sledgehammer couldn't even make a mark on it. So with such manufacturing techniques that can now scale to automotive cost and speed but with essentially aerospace you could save four fifths for automaking actually four to set up with all the plants in Ireland pretty much customize the local conditions you could save a lot of lives because such materials absorb 6 to 12 times the crash energy to seal per kilo and do some more smoothly and in the U.S. loan the oil savings in finding one and a half Saudis or half an OPEC by drilling a very prospective play called the Detroit Formation and those neg barrels under Detroit, same barrels turned out to cost $18 each and they are inexhaustible, domestic, carbon free and secure now those German cars use a process that's much faster and more economical than the carbon fiber race cars but it's more it's actually sort of derived from the way we make aerospace the vast composites and in aerospace you have a thousand times lower volume and higher cost than you would need for series production of cars but I started to get encouraged this nervous gap might be bridged when I met a young engineer at the Lockheed Martin Skunkworks, Dave Tigard Scottish lab he had figured out how to make a joint strike fighter airframe 95% out of the vast composite but one-third lighter and two-thirds cheaper than the 72% metal normal design because it was designed on a clean sheet to be optimally makeable from carbon not from metal well this was a bit too much radical design so he activated the immune system of the joint strike fighter community so he left Skunkworks and went out later I was able to hire him to do the same thing for cars so he led the design with the British German chair one of this uncompromised midsize SUV five adults in comfort also half ton up 44% grade two cubic meters of cargo seven or eight seconds controls and steers that joystick in the right or left seat whatever you want very similar user interface concept to today's Tesla S it's all functionality and software so it's kind of a computer with wheels on a car with chips so many playstations have been cool but what's perhaps more interesting besides the remarkable attributes and working four to six times greater efficiency is the way it's built if you look inside there are only 14 parts in the body each of which can be made with one low pressure die set in a steel SUV body you'd have 10 or 20 times more parts each of them before progressive steel stamping die sets so you save off about 98 or 99% of the tooling cost each of the parts can then be lifted one hand and no voice the biggest part on the side I can briefly lift with one finger and the parts have cleavage joints that snap precisely together self-fixuring for bonding so you don't need a robotic body shop and if you lay color in the mold you don't need a paint shop either they're going to two parts that cost the steps in making the car altogether you save 80% of the capital in automating and the propulsion system gets smaller and slightly cheaper all these savings together pay for the carbon fiber that's how the ultralighting is approximately free so the $18 barrel is not to pay for the carbon fiber that's already covered is to pay for the electrification and the carbon fiber itself is about to get much cheaper and of course you also make weight saving snowballs through this series and you keep going around this loop until things that made it cost more actually turned into things that made it cost less and a lot of parts don't simply get smaller when you're supporting less weight so you need less suspension to hold it up less engine to move and less brakes to stop a lot of parts go away in a good series you hybrid you would not need transmission clutch flywheel axles differential drive shaft u-joint starter alternator you get jumps in weight saving which then compound grab the spirals some more saving still more weight because the less weight you have the less weight you need how far can you go well using the same design process we borrowed from this comfort and offered to Toyota they designed six years ago this concept car that has the same interior volume as classic Prius hybrid but half the fuel use is the weight 412 kilos for a plug-in hybrid 400 kilos for a regular hybrid and just in case anyone thought they were doing this for usemen previous day Torre the world's biggest maker carbon fiber announced a big factory mass produced carbon fiber car parts for Toyota previously much heard in the industry four of other automakers joined that consortium and will soon have worthy competitors and not only in Japan and of course any kind of advanced powertrain is enabled by this sort of ultralight platform sorry about the videos but when you make the car so efficient that it will cruise on the highway on the same power as the wheels that a normal SUV out afternoon run the air conditioner the you know you're using three times less power to move the car so the hydrogen tanks for a normal range 530 kilometers at three times smaller so you don't need any breakthrough storage these are off the shelf tanks that have been around since the 90s extremely safe and the fuel cell gets three times smaller so on normal assumptions that the cumulative production volume cuts the real cost 20% you would need about 30 times less cumulative production to get down to a competitive price on the fuel cell and indeed the industry is already down to a lower price than our analysis assumed so this cuts a decade or two off the deployment time I mention this because if you end up making more wind power than you actually require onshore or offshore there's plenty selling each electron with a proton attached to selling hydrogen and that could be a very interesting way to diversify your energy supplies and absorb some of the variability of the wind power now the same physics and the same business logic apply with variations of heavy vehicles as well for example two-thirds of the energy it takes to move the heavy lorry over the road is air drag well it doesn't look all that different from this Quebec bus which has halved air resistance through more subtle design details and altogether you can triple the efficiency of heavy lorries this is starting to move nicely towards the market and already just design and logistical improvements are nearly Walmart to haul each case of merchandise it is heavy lorry fleet the biggest civilian fleet in the world with 44% less fuel than they used in 2005 we also have triple the quintuple efficiency airplanes on the design screens of places like Boeing, NASA and MIT so when you add up all the heavy vehicles almost a trillion dollars of net fuel saving to be had in the U.S and of course those are all global products that you would be able to buy as well and similarly for light and medium partners the revolution in efficiency in both light and heavy vehicles is accelerated by the military efficiency revolution I've been driving for about 30 years lowered beautifully in the past 5 years so what we're going to see is very like when military R&D gave us the internet global positioning system the jet engine industry the microchip industry many of the foundations of the modern economy except this time it will be driving oil savings in the civilian economy which uses 50 odd times more oil than the military I like that leverage the result will be that we won't need to fight over the oil and our warfighters will have mega-missions in the Persian Gulf in the South China Sea mission not necessary they really like that there are also of course ways to get better access with less driving in the U.S. case 46 to 84% less driving by combining four methods well proven in Europe for sensible spatial planning to car and ride sharing enabled by Spark IT we've also proven a nice method for charging drivers for road infrastructure by the kilometer not by the leader so when you combine all that you can save 4 trillion dollars by driving less to get where you want to be be already where you want to be so you need to go somewhere else so that means you can get a much more mobile U.S. economy in 2050 using no oil and saving or displacing each barrel across all the classes of mobility turns out to cost about 25 dollars rather than buying it for well over 100 dollars so that difference saves you 4 trillion dollars in that present value if I had counted which I didn't just the hidden economic and military costs of oil dependence would certainly have an allowance in Ireland then that would be 12 trillion dollars not 4 so to get off oil with all this extra mobility to phase out the oil we need first to get efficient some of the savings are baked into the government forecast most were not in them and here's a bit for a more productive use of vehicles and then the 1 or 2 liter equivalent for 100 kilometer cars can run on any combination of electricity and the yellow hydrogen green and advanced biofuels in orange the heavy glories in aircraft can realistically run on hydrogen or advanced biofuels or the glories can run on natural gas but no vehicles will need oil and the amount of biofuel required is small enough that you could make 2 thirds of it from waste and you wouldn't need any cropland you wouldn't be harming the soil in fact you would pay barbers by the air and putting it back himself for the logs now our little team speeds these kinds of oil savings by what we call institutional acupuncture if the business logic is congested and not flowed properly we insert the needles and appropriate points of partners like Walmart, Ford and Pentagon and this long transition is already well under way in fact even 4 years ago mainstream analysts were starting to see peak oil not in supply but first in demand because as with oil oil in the 1850s oil is becoming uncompetitive even at low prices before it becomes unavailable even at high prices this is not doing even in our history it's just what Chek Cronin did too long ago when he said that the stone age didn't end because the world ran out of stones in because the world runs out of oil well on this 40th anniversary of the first oil shock I think we can say that that prophecy is being very nicely fulfilled but the electrified autos that help bring it about do not need to add new burdens to the electricity system rather when smart autos exchange electricity and information through smart buildings with smart grids they are adding to the grid of distributed storage and flexibility that help the grid to accept varying solar and wind power and electrified autos therefore make the auto and electricity problems especially on a small island easier to solve together than separately and they also convert the oil story with our second big story namely saving electricity and then making it differently and those twin revolutions in electricity promise more numerous and diverse and profound disruptions in electricity than in any other sector because we've gone basically 21st century technology speed in much of the world colliding head on with 20th and even 19th century institutions, rules and cultures that's why we're really blessed that ESB is getting very forward looking on these issues and I think that sort of leadership is exactly what's needed and a great example of what the country is now changing how we make electricity does get a lot easier if we need less of it today most of it is wasted uh my mother left uh and the efficiency techniques keep improving faster than we install them so the unbought reservoir in negawatts keeps getting bigger and cheaper but as buildings and industries start to catch up and to get efficient faster than they grow for example US electricity demand is officially forecast to grow 1% a year much less than the historic levels but it could instead shrink 1% a year even after the extra use for the efficient cars and in fact we seem to be already on or beyond this trajectory partly because of modern building standards that came into force in half the states in the past couple of years so just last year not yet whether adjusted but this won't make much difference the electricity used to make a dollar of real GDP in the United States fell in one year by 3.7% we've ever seen anything like that before and the notion of stagnant or falling electricity demand even as indeed as a driver of the economy growing 2.4% a year real is now starting to be viewed as the new normal by our electricity industry and we can keep demand dropping by reasonably accelerating existing trends specifically in buildings which use our londu 3 fourths of US electricity the energy productivity can be trembled or quadrupled with a 33% internal rate of return that is we can save 1.4 trillion dollars in the present value and the savings are worth 4 times their cost I'm not counting here non-energy benefits of energy savings for example 6 to 16% higher labor productivity in efficient offices 20 odd percent faster learning in well-daved schools 6 to 40% higher retail sales in well-daved shops better production quality in efficient factories fresher food in efficient fridges and so on those kinds of indirect non-energy benefits are now very well-documented up to 650-page total on them of what they had in real estate value at greenbuildingfc.com we're not counting any of that even though those non-energy benefits are often worth 10 or more times as much as the energy savings we did count but this can be a huge boost to the economy similarly in the industry we can roughly double energy productivity at a 21% internal rate of return and to achieve these things by 2050 in the US we would just need to ramp up over 20 years the average adoption of efficiency to levels that some of our states have already achieved whatever exists as possible I think the average efficiency potential in Europe is not greatly different there's a lot of details different but American buildings have gotten a bit better than you might expect and we just had a very interesting conversation about how to accelerate similar efforts already underway now there is disruptive innovation I want to emphasize here in terms of design we can do even better than normally supposed because it can often make very large energy savings cost less than smaller no savings turning diminishing returns into expanding returns that theme runs throughout our work we'll find many practical cases that's how for example our 10th retrofit saving two-fifths of the energy in the Empire State Building we first had a temporary window factory on the vacant fifth floor and some of the teamsters remanufactured all 6,514 double-placed windows on-site into super windows that insulate three or four times better and are essentially perfect in letting in light but blocking heat and that plus other improvements then cut the maximum building load by a third and that meant we could renovate smaller chillers instead of adding bigger chillers so that saved $17 million of capex which paid back most of the cost right way of the rest of the improvements and cut the payback on the men investment just three years there was a major energy service company that also offered a three-year payback but they didn't get the job because their savings were six times smaller that's because they used normal disk integrated design where you optimize each component singly for a single benefits whereas we optimized the whole building as a system for multiple benefits and by doing that lately in some other retrofits big buildings were receiving savings as much as 70% some old buildings can now be made better than the best new building that was a big surprise so the saving yard is moving very rapidly and by the way for an all glass windows curtain wall sort of office building the savings on the cooling load could be two-thirds the total energy savings could be three-fourths and a lower cost than the regular 20-year renovation that saves nothing provided that you time the whole building deep retrofit at the time when you were going to renew the facade anyway but you have to do every 20 years because the glazing seals fail so if you go to retrofitdepot.org you'll find tools for portfolio owners to do exactly that now here's another interesting example especially if you end up living in Labrador because the bulk street loses interest in water's office just think possibility we've known that since the 60's I happen to live at 2200 meters up in the Rocky Mountains near Aspen and this building house general and research center where we hatched our institute is in a rather severe climate it used to go down to minus 44 celsius on occasion you can get 39 days continuous cloud of midwinter you can get frost any day of the year just had snow a few weeks ago but this was a prototype forerunner of the house and house that's built over 30,000 houses in Europe that like ours have no heating system they don't need one, they're so well insulated but they have probably normal construction costs and it doesn't need to look like this to work like this now if you come to this super window glazed atrium the glass looks like two sheets of glass costs less than three but insulates like 14 this is what it looks like during February snowstorm and you can see two of the five banana crops are ripening at the time in fact we just harvested banana crops number 46 and 47 twins on the same stock you can do that but the tree figured it out and actually it harvested itself because the bananas weighed 30 kilos and they simply pulled down the tree a couple of months ago now when I first moved in this house was using 1% the normal space and water heating energy 1% the normal electricity and half the normal water all over the 10 month payback today's technologies are a lot better so we've now retrofitted them we're measuring 300 data streams to see how much better they are the trouble is the measuring equipment seems to use more electricity but the sort of approach of integrative design applies to any climate it's been used to eliminate air conditioning which is not a limit with lower construction costs and better comfort it's been used in steaming Bangkok to save about 90% of air conditioning energy with normal construction costs and better comfort and wherever you are the idea is to get all the benefits from stable expenditures so this white arch holding up the middle of the building has 12 functions and only one cost the same approach can multiply the half trillion dollars of conventional energy savings in the US industry in the Irish industry Dow Chemical for example has already captured about $9 million of savings about $1 million investment but there's more to do just for example 3 5th of the world's electricity runs motors and half of that runs pumps and fans we can make pumps and fans a lot better we can do 35 things to typical existing motor systems to save about half their energy with one year of payback but first we ought to do bigger and cheaper savings that are normally ignored they're not in any official study or forecast they're not in any implementation program I know of they're not in any engineering textbook I've seen for example pumps the biggest use of motors moved liquids through pipes but a typical industrial pumping loop was redesigned by a Dutch colleague to use at least 86% less pumping energy not by getting better pumps and motors often worthwhile but just by replacing long thin crooked pipes with that short straight pipes that's not a technology this is about rearranging our mental furniture as designers using big pipes and small pumps instead of small pipes and big pumps and laying out the pipes first then the equipment takes about a half hour to train a plumber or a pipe fitter and have to do this and afterwards it has such good grade and go pro they will not do it the old way again at least with that and it's a lot more fun and by the way when we did the same approach in our house it did take half an hour train our plumber how to do it we saved about 97% of the pumping energy and the capex goes down because the pumps and motors the expensive get get smaller so what does this mean for the electricity that's three bits used in motors well from the fuel burn to the power plants there's so many compounding losses that only a tenth of that fuel energy actually comes out the pipe's flow but if we run those compounding losses backwards from right to left they turn into compounding savings and every unit of flow or friction we save here in pipe compounds back again to save ten times that much fuel at the power plant along with costs and emissions and what our law is called noble and near deep and as you go back upstream the components get smaller and cheaper so our team has lately found those kinds of snowballing energy savings and many diverse industrial re-designs 30 or 40 billion dollars worth so far from the Schullin-Packard data center in the North of England to this Texas Instruments CHIP FAB and the American Rio Tent and Rimeshell hydrocarbon facilities and so on on many with nice side benefits the Texas Instruments FAB was built in Texas not China because we were able together to pull out 30% or 230 million dollars of capital costs along with saving a lot of energy and water the the plan for the data center in the North of England was the end of the revenue which wouldn't allow what was then EDS to adopt most of our recommendations we were able to triple the efficiency at the same cost but EDS told us had they been allowed to adopt all of our recommendations they considered sound they would have saved about 95% of the energy in half the capex now typically our retrofit designs for supposedly efficient big plants of all sorts saved about 30 to 60% of the energy with the two or three year payback facilities we do a bit better 40 to 90% but the capex almost always goes down now as buildings and industry get more efficient and we need less electricity therefore that makes it easier and faster to shift to new sources of electricity cheaply renewables China leads their explosive growth and their plummeting cost shown here on a logarithmic scale for photovoltaic modules in blue now off the bottom of the chart and for wind farms in green both continuing to fall and both of these are already marketplace winners in the more favorable parts of the United States new solar and wind power have a lower levelized cost to new provide cycle gas power even though we're watching supposedly cheap gas and actually the majority of the system cost is not for photovoltaics it's not the module it's all the other kit and procedures to get the total installed system in place but Germany by scaling to 8 gigawatts a year and as much as 3 gigawatts a month has grown out those costs throughout the value changes so their average install cost for solar power is now half of the US level so naturally time of motion studies seem to be swarming over Germany to find out how do they do in four hours takes us 13 hours or whatever but even at the WS cost in about 20 of the United States today we're already in grid parity and as we are now in Italy and so on and therefore entrepreneurs will happily come to your house in those days and put solar power on your roof with no doubt payment of featuring your utility bill so if you combine that with other regulated products it could add up to a virtual utility that bypasses the power company much as mobile phones bypass the wire line phone companies of course this gives utility executives a nice venture cap on the sweet dreams but in our electricity innovation lab where the incumbents and insurgents have a safe place to talk to each other and create mutual value rather than mopping grenades and turning out you can actually make this sort of thing into a great business opportunity for organizations let me give you the bigger picture worldwide, half the new generating capacity added each year starting in 2008 has been renewable about two fifths of the electricity sorry one fifth of the electricity has grown very rapidly but fair amount of that new capacity has been hydro let's take out the hydro and just focus on modern renewables like wind or blue rather photo takes and green something extraordinary has happened it used to be that the means of producing electricity was like building a cathedral it would take you a decade it would cost billions of pounds of euros and now for the same time and roughly the same money you can build each year a solar factory which each year thereafter will produce enough solar cells to produce each year the same amount of electricity that their thermal plant would have made that ability to scale changes everything I was just in a Chinese factory that makes several gigawatts of solar cells every year they just stamp them out 24-7 and that is how the global clean energy sector has been able to scale so fast and over a million European jobs even in the US which lags a bit we now have more solar or wind jobs than we have coal or steel jobs and if you look at the last full years data we have for 2011 is next to last point in that year the modern renewables and non-hydro renewables invested a trillion dollars since 2004 they got a quarter trillion dollars of private investment more than for all new nuclear fossil plants combined they actually surpassed the local installed capacity of nuclear power by adding 84 gigawatts and in contrast to the ability to make say 59 gigawatts that the photo will take a year which we added about 30 the supply ran ahead of demand by the way China is going to soak up that surplus in the next couple of years because they just raised their installed target for 2015 to 40 gigawatts in contrast to that nuclear had negative net additions before Fukushima and orders worldwide for both nuclear and coal plants to start fading away by steadily accelerating because they have no business case they cost too much and have too much financial risk to interest investors and we're starting to shut down not just a lot of our coal plants but some of our well-running nuclear plants because they're now uneconomic just to operate leaving aside their sunk capex now we are often told that that only the coal and nuclear plants can keep the lights on because the big thermal plants are 24-7 when that photo will take are variable supposedly unreliable but of course no power plant is 24-7 they all break sooner later and when big power plant breaks you lose maybe a thousand megawatts you lose it in milliseconds it goes away over weeks or months often without warning and that is why we've always designed the grid so that failed plants are backed up with working plants that's to manage the intermittent of big thermal power plants and occasionally failing the transmission lines well in exactly the same way the grid can manage the forecastable variations of a portfolio of variable renewables that are diversified by type and location they're forecasted they're integrated with dispatchable renewables all the other kinds which you can have whatever you want they're integrated with the mad response with the distributed storage and it turns out that's enough for example according to our National Renewable Energy Laboratory to tell a study a year ago to run an 80 or 90 percent renewable electric system with good economics and full reliability let me show you how this works for something a little more like Ireland different climate but the powerful Ram, Texas is isolated from the rest of the country I think I'd like an island so let's look at how to run that entirely on renewables in a typical summer week in 2050 when the load shape looks like that or like this if we use electricity in a more profitably efficient way we still need to hear about 30,000 megawatts what's the rate in Ireland now five six times in Ireland now let's do all of this with renewables we'll start off by meeting 86 percent of the annual need with a combination of wind and potable ticks and you can see from these actual data how variable they are then let's get the other 14 percent of the annual electricity from other renewables that are dispatchable everything from geothermal and small hydro to solar thermal electric to burning municipal waste burning agricultural biogas and existing industrial turbines and energy studies is my favorite and we can see that the total is a bit closer to meeting the load shape but sometimes we have too much and other times not enough so now let's put the two types with the surplus into two types of distributive storage one which would have less application in Ireland as high storage air conditioning but very important in Texas the other kind which would go very well here is far charging of electric vehicles and then we can get that energy back when we need it and fill in the last bits with unobtrusively flexible demand and now we have fully reliable reliable supply every hour of the year with no bulk storage and only 5 percent of the renewable generation is left over I offer that as a modest existence group but quite a few places are actually starting to choreograph renewables in exactly this way as you are doing in Ireland we get a few other examples to show that this sort of leadership is better competitive on the continent Germany was 23 percent renewable last year peak around 70 they just hit 25 percent peak front photovoltaics alone which is astonishing and in a couple of the states there are about half wind power Portugal was 17 percent renewable electricity in 2005 45 percent in 2010 70 percent the first quarter this year when it was windy and rainy and quite impressive that included 27 wind the first quarter well known example of Denmark another strongly agricultural country probably most similar to Ireland in many respects 30 percent wind power in total 41 percent renewable last year and 80 percent renewable and Spain in the spring like in April they were 54 percent renewable 22 of that wind so these kinds of experiences like yours support the emerging European vision of all renewable electricity over decades and this all renewable vision has already been achieved in at least one sector sometimes in all sectors by eight countries 41 cities 48 regions eight utilities 21 other institutions so this is not a fringe activity anymore and I think it's very encouraging to look if you're doing Ireland fairly challenging situation of a small island is already doing so well and holds so much promise of doing much more and as for the notion that variable means unreliable these are all the French data on wind power combined for December 2011 which was very stormy for example you can see the very sharp changes in wind output shown in red but the blue is the forecast wind output one day ahead I bet we wish we could forecast demand that well of course as you get within a few hours so you're starting to find two of the operating schedules if there are other facilities that are essentially disappears there's another very important trend which is illustrated here for Denmark and that's the move from highly centralized in this case co-part plants to highly distributed wind power in blue and typically agricultural waste co-generation in brown and as in Germany where over half the renewable capacity and 86% of the wind power Denmark is owned by farmers and their communities and their cooperatives so I think you have a very interesting opportunity in Ireland to invent crowd source funding that enables local residents and their communities and co-ops to invest in their own means of supply Denmark by the way has a government that plans 100% renewable energy not just electricity by 2050 they think they'll get there essentially no extra cost self-advertising and they're reorganizing their grid in a cellular architecture that makes cascading blackouts impossible now in my own country we're quite ways from this only 2% of our renewables are relatively low tax structure favors our charcutters but we do have this aging dirty insecure electricity system that we have to replace anyhow by 2050 and whether we replace it with more of what we've got or with new nuclear build and so-called clean coal or with naturalized renewables or with more distributed renewables turns out all those futures cost the same within noise but they differ profoundly in risk around national security fuel water, finance, technology for example we have an over centralized grid that is very vulnerable to cascading and potentially economy shattering blackouts whether caused by bad weather on earth or outer space super storms earthquakes, physical attacks, cyber attack but that blackout risk disappeared and all the other 6 kinds of risk are best managed with distributed renewables reorganized into micro grids that normally exchange power freely but can disconnect fractally reconnect seamlessly and thus work with or without the grid the Danish model and this is indeed the pentagon strategy now for military power supply because they need their stuff to work and the rest of us are depending and my own house works this way I can tell you it's very reassuring to live in an under eruptable power supply that works with or without the grid occasionally you go outside and see if your lights are on but your lights are certainly on and it doesn't cost extra to do this on a natural scale as part of the stark grid evolution it would be a huge gain in your individual community and national security because it is an entrepreneurial opportunity innovation so let me summarize the electricity story together the efficient use and diverse distributed renewable resilient supply we're starting to take over the whole sector it used to be that our power companies would just buy big stations at various times and maybe a bit of efficiency of renewables and we would reward them for selling us there's no reason to do that and in 15 of the United States for electricity and for gas we changed the rules so instead we reward the providers for cutting our bills so they have identical incentives not opposed to incentives this has a quite miraculous effect on culture and behavior and it means that the investment goes other way up that they start investing massively in efficiency demand response renewables, combining power distributed storage, stark grid ways to blend everything together lively with less transmission and little above storage and that's especially true in the three fifths of the United States where the efficiency and demand response of demand side resources are allowed to bid into what were previously just supply side options because it's so much cheaper to save electricity than to produce it so that the demand side options tend to win the options so our energy future is not feet but choice and I'm going to skip a thing here on show gas we'll go back to that if you like but I just want to emphasize how flexible our choice is around 1975 US government and industry all insisted that the energy used to make a dollar of GDP could never go down so it was quite theoretical when I said it could go down several fold what happened well so far it's down by over half but now we have much better technology three times cheaper than it used to be for saving electricity we have integrative design, we have better financing, marketing, delivery channels so we have a very clear line of sight to have a travel efficiency all over again at even lower cost so to solve the energy problem we just needed to tune in margin and integrate it the results may at first seem astonishing they certainly surprised even us but as Marshall McLuhan said only puny secrets need protection big discoveries you said are protected by public incredulity now combine the electricity and the oil revolutions and you have the really big story of re-inventing fire that is enabled and sped by smart policies and mindful markets can lead a country like mine or I dare say like yours all of them fold by 2050 saving lots of money growing economy in this case 2.6 fold strengthening security and by the way cutting carbon emissions 82 to 86% now if you like any one or more of those outcomes you could support this transition without needing to like every outcome needing to agree about which outcomes are most important so focusing on outcomes not motives can turn gridlock and political conflict into a unified solution to our common energy challenge and by the way also give the most effective solutions to the big global problems that hazard every country's security and prosperity so our little thing to do tech helps smart companies and occasionally governments to get unstuck and speed this journey by many sectoral initiatives and projects of course there's a lot of old thinking still about too former oilman Marie Strung sometimes says that not all the fossils are in the fuel but as Edgar Woolard reminded us when he shared his thoughts companies hampered by old thinking won't be a problem because in the long run they won't be around now what I've described for you is not just once in the civilization business opportunities one of the greatest transformations in the history of our species because we humans are really inventing a new fire not dug from below deployed from above I've even heard theologians talk about energy from hell and energy from heaven and the new fire is not scarce but bountiful it's not local but everywhere it's not transient but permanent it's not costly but free and but for the transitional tale of a natural gas and a bit of biofuel grown in ways that sustain and endure in support for our culture this new fire is flameless and efficiently used it really couldn't let energy do our work without working our own doing now each of you owns piece of that big prize and our book details how each of you can capture that opportunity in ways I think to be adopted or adapted to Irish conditions and know that along with many new tricks that belong to you as Oscar so with the conversation began at reinventingfire.com and Ted Talk and the Orders paper and the resources here let me invite you each to engage more with us with each other with everyone in Ireland to help make your country and the world richer, better, cooler and safer by together reinventing fire thank you for your good work thank you