Marginal Utility

Deck: 

The Carbon Paradigm Shift

Fortnightly Magazine - July 2016
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Thomas S. Kuhn, the late Berkeley philosopher, conceptualized the paradigm shift. The moment when one big idea supplants another.

An example is when Copernicus convinced the world that the earth circled the sun and not vice versa. A shift can take decades. Old and new paradigms co-exist until the old one fades out when its followers retire or die. As the German physicist Max Planck put it, “Science advances one funeral at a time.”

Okay, now let’s cut from the history of science to electricity. Kuhn’s concept can shed light on three electricity paradigm shifts, as the industry adjusts to climate change, transitions from a central station to distributed model, and develops new business and financial structures to replace those that pre-date Samuel Insull. 

Let’s start with climate. Under the old paradigm, electric utilities selected options to produce the lowest priced electricity for most consumers. They did not consider externalities, such as costs imposed by climate change or pollution, unless instructed to do so by regulators. They resisted customer preferences that did not fit the model. The paradigm produced reliable, increasingly clean, and affordable service. But times change.

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