Insights and Strategies
2024… an Electric New Year
You might think of electricity as a relatively modern technology, but it is believed that the ancient Greeks, Romans, and Egyptians used electric fish as a treatment for epilepsy and gout. Much more recently, in the early 1600s, English scientist William Gilbert coined the word “electricus”, from the Greek, to describe objects that attracted dust “like amber”, leading to the term “electricity”. In 1745-46 the Leyden jar was the first device to store and discharge static electricity. Benjamin Franklin later used a Leyden jar in his famous 1752 kite experiment, which rather than channeling lightning, actually just picked up the ambient electrical charge from a storm. Nevertheless, this demonstrated the relationship between lightning and electricity. In the early 1800’s, Alexandra Volta developed the electric battery and electric generator, and Michael Faraday developed the first electric motor. In 1882 Thomas Edison set up the first power plant in New York City, and electric streetlights in Roselle, New Jersey. Later, Nikola Tesla partnered with George Westinghouse to challenge Edison’s direct current (DC) technology, with a more versatile alternating current (AC) system and essentially kicked off the modern age of electricity.
Fast forward to 2024 and we are seeing an acceleration of a global drive to electrification as many countries strive to reduce reliance on fossil fuels, in part as an attempt to reduce carbon dioxide production and consequently slow climate change. This push is evident from the relatively rapid increase in electric vehicles on our roads.
Many companies and countries are in a race to become clean energy leaders, evidenced by large-scale government investments in long-term electrification and emission reduction projects. Since 2020, government spending has been a key driver, rising nearly 25% from 2021 to 20231.
The table below provides an overview of some major government investments by country. In Canada, the 2023 Budget has identified growing a clean economy as a major national project that the government compares to the Transcontinental Railway project in the late 1800’s. In the U.S., the Inflation Reduction Act (IRA), marked the largest climate-related investment in U.S. history. Additionally, China’s investments in its power sector, including solar and wind energy, electric vehicles and batteries may exceed US$13.7 trillion from 2020 to 2060, and not to mention the various initiatives across the European Union.