Shaking out the maturity

At a tender age of 49, I firmly reject all notions of me being middle-aged or even worse – mature. However, for most industries following the maturity curve is a natural part of their life cycle. The length of the cycle and the specific structure of the curve can vary significantly, from few years to decades and from condensed to drawn-out curves, but nonetheless almost all follow it one way or another. Me included, unfortunately.

I have been fortunate enough to work in two very different industries, IT and renewable energy during periods when both were developing rapidly through their respective curves. I entered the IT business in 2001 and saw the tail end of the dot com bubble and the subsequent maturing of the “www business” over the following years. It feels like an eternity has passed since those years in the early 2000s and the entire IT sector has developed so much that I’m sure the 2001 version of me would not recognize much of it. As Arthur C. Clarke famously put it:

“Any sufficiently advanced technology is indistinguishable from magic.”

Looking at the almost 15 years of working in renewable energy, I feel quite different. The industry has certainly been on the maturity curve and clearly moved from initial growth to shakeout or even some cases to maturity, but there’s no magic. It seems we are viewing two separate curves:

• market maturity and
• technological maturity

The renewable energy market has grown up and become (mostly) viable on its own and in many cases have reached a point where renewable energy is the cheapest form of new energy installations. It is fair to say that the renewable energy market is reaching maturity as we speak. And in some respects, it already has. This is supported by the industry consolidation currently underway.

At the same time the industry faces significant technological challenges yet to be solved. The rapid growth of wind energy in the early 2000s was driven, in part, by the government support mechanisms and investors’ desire for lower unit cost. OEMs responded by developing new and larger platforms as fast as possible. In 25 years, the turbine sizes effectively grew by 10x. In IT this might not be anything to brag or worry about, but in the development of energy infrastructure, it’s unheard of.

Source: Thompson Rivers University

While both were noble ideas on their own, government supports mechanisms to solve the industry’s chicken and egg problem and investors trying to achieve the most economically efficient and profitable projects, they had some unintended consequences the industry is still fighting today. In essence, many solutions which worked fine on smaller turbines were problematic when scaled up or the scaling itself introduced a whole set of completely different problems.

I might have to write another blog post about the issues I’ve seen. It’s not pretty.

On the positive side of things, I see more companies coming up with innovative solutions and products to solve these issues. There’s certainly hope.

I wish you all Happy Holidays!