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Planet and stars in space

13 Dec 2024

Christmas 2024 – the silent stars go by

Harold Hutchinson | Senior Adviser - Alternative Energy

A sustainable and enduring energy transition is conditional on a continuing spirit of discovery. Harold explains how humanity must keep its options open when exploring future energy solutions.

 

At Christmas, we reunite with family and friends. Time away from work stimulates reflection and new aspirations. We look back at the year past and make tentative plans for the one ahead.

We can stretch this way of thinking further. What was Christmas like one hundred years ago? What might it be like a hundred years hence?

While these are longer periods of time, there are people around today who were alive in December 1924. Moreover, for newborns in December 2024, it is reasonable to assume they might live to see December 2124, as life expectancy increases.

Allowing our minds to contemplate these longer periods reminds us just how much our comprehension of the world evolves, often unnoticeable on a day-to-day basis, but cumulating into huge change over longer periods of time.

Let’s slip back for a moment to December 1924. The view of most astronomers at the time, as they stared up into the cold heavens, was that the Milky Way amounted to the full universe – one large galaxy stretching majestically across the night sky.

However, not everyone agreed, including Edwin Hubble. His doubts centred on observations of the Andromeda Nebula. The telescope at the Mount Wilson Observatory in California showed many exploding stars within that celestial cloud. Was it really part of the Milky Way, or might it be a galaxy in itself?

Building on earlier theoretical work by the Harvard mathematician Henrietta Swan Leavitt and using observations of the light emanating from the nebula, Hubble calculated that Andromeda must lie far beyond the Milky Way. He announced his findings in December 1924. Today, we take this (then controversial) conjecture as a basic astronomical fact.

So, one hundred years ago the headlines in the media reported that the universe had at least two galaxies. But that is not the punch line.

Today, astronomers believe there are around two trillion galaxies in the observable universe, expanding over an unfathomable topology of spacetime. All that discovery in one hundred years.

Now, what has all this to do with the subject of the energy transition? Well, here is just one that is relevant today.

Discoveries are not linear - eureka moments can change everything in the twinkling of an eye. Equally, great insights can then lie dormant for decades in a dusty lab before breaking through onto the world stage.

We see this in the energy sector repeatedly. One hundred years ago, solar photovoltaic (PV) panels were confined to the roof-tops of a few eccentrics, with no commercial market. Even when their potential use in space became clear, with the satellite boom of the 1960s, no one saw them having mass market potential on the ground. Then came unexpected use cases on planet earth - hard to access lighthouses being one example.

Fast forward to today - 600GW* of solar PV will be added to global capacity this year alone (for comparison 1GW was added in 2000). Solar panels, large and small, are emerging everywhere to meet our energy needs, from grid-scale to roof-scale. The exponential cost reductions and performance improvements of the technology have taken everyone by surprise, but are now common knowledge.

For this reason, the real impetus for the current energy transition lies in a continuing spirit of discovery. When we forget this, we become distracted by the present, creating artificial timelines, and falling into narrow siloes of belief. We try to timestamp the future with our present understanding. However, we are at the early dawn of a process, not its twilight.

The longer-term answers to our energy needs lie in our universities and corporate research divisions, as they peer into the unknown for answers. This is equivalent to equity investment, be it state or privately funded. There will be many losses and some great gains - that is the financial flipside of progress. The ultimate arbiters of success will be voters and consumers, at least in a democracy.

Let us not fall into two easy traps:

  • Advocating immediate silver bullet solutions at the expense of all else (may look good today but end up stranded tomorrow).
  • Dismissing unlikely and more eccentric alternatives (out-of-the money today but may yet come to shine).

We need diversification that leaves room for discovery.

British philosopher, Iain McGilchrist, has expressed this idea in a broader context:

“The only certainty, it seems to me, is that those who believe they are certainly right are certainly wrong.”

In conclusion, while being attentive to current needs, a sustainable future is one where humanity keeps its future options open.

Let´s hope 2025 unfolds as one of discovery. Happy Christmas, and to those new arrivals to our world this month, a prosperous and exciting century ahead.

 

* A GW is a measure of electrical power (1 billion watts). For comparison, light bulbs at home might have a power rating of 2-100 watts depending on their type.

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Disclaimer: The blog does not aim to give investment advice, but is designed to afford relevant longer-term context to investors, encouraging a broad perspective where uncertainty is high and a spirit of learning is important. The views expressed are those of the author, not those of Investec.