written 19 October, 2025
published 26 October, 2025
Wikipedia describes disruptive innovation as the creation of new markets or values that eventually displace previous products. For example, cars were originally expensive luxury items, until Ford introduced the modestly priced Model T. A 1900 picture of downtown New York City showed one car surrounded by horses. By 1913, a picture of the same street had only one horse surrounded by cars, as the entire economy shifted. A similar disruptive innovation is happening today in the world of energy.
The US produced 4,292 terawatt hours of electricity last year (one terawatt hour equals one billion kilowatt hours). The sources were: natural gas (44 percent), renewables (23 percent), nuclear (18 percent), and coal (15 percent). With the exception of renewables, all these sources consume finite fuel resources. As these resources are used, the cost for extracting new fuel increases.
Electricity from natural gas seems economically affordable because the adverse climate impact is never included in the cost. Most US natural gas comes from domestic fracking, which can be distributed by pipeline. As these fields deplete, which has already begun, consumption will have to shift to imported liquified natural gas (LNG) which costs 2-5 times as much.
Nuclear is already the most expensive electricity on the grid, without even including costs for radioactive waste disposal, decommissioning retired reactors, or any risks from accidents. The Fukushima cleanup is optimistically projected to cost one trillion dollars and take a century.
The US has extensive coal reserves, but coal is not very energy dense, making coal powered electricity some of the most expensive on the grid.
As these consumption power sources become more expensive, electricity rates keep rising, with a 50 percent increase in the last 5 years. This will get worse as more AI data centers get built, increasing demand. Communities near these centers have seen rates more than double.
In addition, consumption power sources have to be large to be economical, which requires an extensive transmission grid. As electricity demand grows, grid limitations affect not only affordability, but even availability. A year ago, the September heat wave in California caused air conditioning loads to stress the grid almost to the point of failure, avoided only by extreme efforts to shed all possible loads.
In comparison, renewable power is becoming cheaper each year. Wind power costs half what it did a decade ago. Solar panels, which cost $129/watt 50 years ago, cost $0.24/watt today. Grid scale ground mounted solar installations currently cost $1.50/watt in the US and half that in other parts of the world.
Renewable power requires a new perspective on energy. Since it was first commercialized, electricity has usually been produced by burning something when power is needed. The renewable model collects free energy when and where available, which must be used immediately or stored until needed. Each year, battery storage systems are getting cheaper, and lasting longer. Six years ago, a shipping container with a megawatt hour of lithium battery, including inverter and battery management electronics, air conditioning, and fire suppression, cost $0.50/watthour, and would last 10 years. Today, the same system, with an improved lithium battery costs $0.25/watthour, and lasts 25 years. Within a year, the same system with a safer sodium battery will cost $0.15/watthour and last 50 years.
While large wind farms and solar arrays support the grid, these hardware installations don't have to be massive. A single home, business, or community can install solar and storage wherever there is available sunlight. Even though the smaller scale systems cost more per watt than grid scale, the resulting electricity is still cost competitive with grid power, especially if the power provider is investor owned. The economic burden results from essentially prepaying for decades of electricity, though the price is fixed, proof against inflation.
Renewables are already changing the world. Africa and Pakistan are seeing explosive growth in solar and storage, as poor people are able to cook without burning fuel, have efficient indoor lighting, pump water, and have refrigeration for food and medicines.
Fossil fueled power is losing economically, and becoming an irrelevant, stranded asset. But in the US, the owners of these existing power systems don't want things to change. Our president denies the climate reality, kills domestic efforts to build renewable power, uses tariffs to make imports expensive, and supports the most expensive electricity on the planet, without regard for consumers. Under this plan, the US becomes obsolete as the world changes.
