The 1st day of the workshop on Past Energy Transitions started after a get-acquainted lunch. Roger Fouquet (LSE Grantham Research Institute on Climate Change and the Environment) opened the workshop with a keynote speech on Cost-Benefit Analysis of Historical Energy Transitions. In the first part of his talk he provided an extensive review of the revolutions in energy services in Britain, tackling the question of whether energy transitions have improved well-being as well as reviewing the ways in which net benefits have changed with economic development and energy transitions. He described the main drivers of changes in consumer surplus of energy services and provided concrete examples of such consumer surplus changes in domestic heating, passenger transportation and lighting in the UK over the last two centuries. He also addressed the consumer surplus changes in energy technologies and transitions using as an indicator the changes in different types of lighting, transportation and heating technologies. He pointed to the external costs of energy services (such as pollution concentration, deaths from bronchitis etc) so as to exemplify the net welfare by looking at the marginal benefits and marginal costs of passenger transportation and heating. His approach for estimating welfare elicits useful lessons for the role of new energy transitions and serves as a guide for policy decision-making in energy services and management as well as for future research.
After Fouquet’s keynote speech, Session 1 on ‘’ Capital and Durable Goods – Path Dependency’’ started with a presentation from Mats Bladh (Swedish Energy Agency) on the ‘’Origin of the car culture and the victory of the gasoline car.’’ His paper looks at the origin of the car technology and its coupling to gasoline as fuel for the case of Sweden. During his presentation he discussed extensively Sweden’s political and economic challenges associated to the country’s dependency on imports of fossil fuels from abroad. He offered a historical overview of the US transitions in transportation since the 18th century along with main drivers for the establishment of the car as a means of popular use. He provided illustrations of the complex role of path dependency regarding energy transitions with photographic evidence of the extent of bicycle path infrastructure in the US at the dawn of the car age. In the transition to cars, this investment actually likely hastened the demise of the bicycle rather than enhanced it, by providing excellent starts on road infrastructure. He further discussed the technological, economic, political and social environment that allowed the transition and highlighted the reasons behind the failure of efforts to replace gasoline with ethanol and other (bio)fuels in Sweden, at least up until the early 21st century.
In the presentation that followed, ‘’Capital and Durable Goods-Path Dependency,’’ Magnus Lindmark (Umeå University), focused on the transformation of the organic energy system for the case of Sweden. For the purposes of illustrating the transition from a bio-based to a fossil fuel energy system exploiting mineral resources, he first provided an overview of the environment and the natural resources available in Northern Sweden, along with the socioeconomic environment. He discussed the steam engine period in Sweden as an important part of the energy transition process, highlighting its institutional role. He further reviewed the main drivers behind the demand for coal and highlighted the role of the Swedish forest sector as one of the most important pillars in the Swedish industrialization process. Using the example of the charcoal consumption for ironwork, even before the 19th century, he explained how coke enabled increased economies of scale in the iron industry. He concluded suggesting that the increased demand for coal was primarily derived from the demand for mechanical power by steam engines in the manufacturing industry and transport sectors which explains the reason why coal consumption increased despite coal being more expensive than pine firewood and despite relative prices between the two remaining fairly stable; a feature attributed to the substitutability between the two.
The presenters of the first day sought to provide an understanding of past energy transitions and communicate lessons learned across energy shifts in different parts of the world and their main drivers. They all used past experiences to elicit useful lessons on the challenges of energy shifts, that serve provide useful frameworks as well as policy-relevant guidance for identifying current energy management needs as well as future research directions. The economic underpinning of the presentations stimulated discussions among the participants regarding the need to broaden our understanding of historical energy transitions and use economic tools and approaches for designing and evaluating future energy management strategies.