12 Disruptive Technologies by 2025

An economic impact analysis has just been published for 12 disruptive technologies that McKinsey Global Institute projects will begin to transform not only how we live and work but the economy over the next twelve years.

For a brief description of what makes a technology worth tracking as disruptive, click on this interview with Google executive chairman Eric Schmidt.

The McKinsey analysis entitled, Disruptive technologies: Advances that will transform life, business, and the global economy is fascinating and filled with interesting tidbits.  One is that 2-3 billion more people will access the Internet by 2025.

Reading that, It struck me as ironic that those in high office who are most boastful  that America is providentially exceptional, something with which I agree to a point, are the same ones restricting the expansion of broadband access in this country.

Gridlocking infrastructure investments such as this will pull us far behind other countries creating a sort of “excluded-ism.”

Mindful of that, maybe that’s why my attention was drawn in particular to two of the disruptive technologies in the report, energy storage and renewable energy.

Many of us see rapidly advancing energy storage in terms of adoption of hybrid and electric vehicles (55% of new cars could be plug-in hybrid by 2025) but according to the report, rapidly advancing storage technology will also soon bring electricity to a billion people who don’t have it.

This isn’t included in what could be a $635 billion annual impact by 2025.  However, that amount does include the boost that improved battery storage will bring to the efficiency and quality of the electric grid while reducing emissions of CO2.

While one of the disruptive technologies in the report is the 100-200% efficiency increase in our ability to wring the last drop of fossil fuels from the earth, it is heartening that renewable energy also makes the list.

The cost of a watt from solar cells has dropped by 85% since the year 2000.  Renewables are being adopted “at scale” in the US and EU and soon in China and India.  The report makes projections based on two scenarios, one that trends breakthroughs and another with “technology frozen at current levels.

Fossil fuel devotees conveniently forget that this energy source has been heavily subsidized over the decades and continues to be today by refusals to adopt full-cost accounting, not only of exploration costs but the cost of shipping, military escorts and to the earth’s inhabitability.

Several scenarios in the report factor in various levels of subsidies for development of renewables as well as net those out of economic impact estimates while adding in estimates of the value of reduction in CO2 emissions.

The interrelated dynamic today of fossil fuel technologies and renewable energy technologies is creating an interesting but conflicting environmental narrative.

As the report notes – “The shift from coal to gas for electricity generation is reducing greenhouse emissions while simultaneously leaching urgency from the drive to develop renewable energy sources.”

In North Carolina, where I live, there is an interesting scenario underway.  Republicans control the Governor’s office and both houses of the General Assembly.

Some, such as Republican Representative Chuck McGrady, still have conservation bonafides, having also been national president of the Sierra Club.  Many however are true to form to this skit by comedian Steven Colbert.

Colbert, who grew up and still has a vacation home in neighboring South Carolina devoted a skit to North Carolina lawmakers who tried to legislate projections for sea level change. As Colbert notes, “…this is a brilliant solution.  If your science gives you a result you don’t like, pass a law saying the result is illegal.  Problem solved.”

The skit is well worth viewing as Colbert provides humorous examples of applying the logic of Republican lawmakers to things such as longevity.

Republicans here are also advancing a prior Democratic tax reform proposal that shifts tax burden from corporate and individual income tax to a sales tax broadened to more equitably include many more types of purchases not only by individual consumers but businesses.

At the time, the sales tax rate would be reduced.

Another comedian, Dr. Yorum Bauman, aka “the world’s only stand-up economist” gives a funny but insightful TED presentation on why a “revenue neutral” carbon tax is a tax reform upon which many Republicans and Democrats, Conservatives and Liberals and both climate-change skeptics and believers can find common ground.

He explains that the basis of such tax reform is to “tax what we want less of…instead of things we want more of.”  Bauman notes an experiment that lawmakers such as those in North Carolina should study closely.

The Canadian province of British Columbia is gradually increasing a tax on carbon, while offsetting it with reductions to taxes on individual and business income.  North Carolina could expand the reductions to include sales tax.

At a federal level in the US, a similar approach would lower individual and corporate income taxes, reclaiming offshore sheltering while providing much needed revenues for infrastructure and R & D into disruptive technologies while reducing climate change.

In B.C., the arguments about the carbon tax policy have gone from “fur or agin” to how to increase its application and whether to use it all for tax reduction or for other uses that will meet the goal.  Links in this paragraph cover several different perspectives.

In this country, those obsessed with contempt for taxes and government are caught up in the futile and counterproductive attempt to starve out waste, starving even the enforcement efforts intended to ferret it out.  In turn, this also forces a counter-reactionary response to program loss rather than waste reduction.

Lose, lose, lose.

As Bauman notes, the B.C. approach is win, win, win because it taxes what we don’t want – pollution – and reduces taxation on what we do want – income – which will “promote innovation, conservation and development of new technologies.”  Sounds more like capitalism than the approach in the paragraph above.

It is amazing what can be done when we find common ground.