By Kiran Bhatraju
One of our wise advisors once told me, “There are two businesses: building a new widget or creating an innovative way to market, distribute, and finance that widget.” When it comes to solving our climate crisis, Bill Gates thinks we need the former, but a carbon-free world actually needs entrepreneurs to focus on the latter.
Energy revolutions don’t happen quickly or often. In fact, they take centuries. We had fire, steam, fossil fuels and, today, we finally have clean, renewable energy. The renewable technology stack (solar, wind and efficient products, to name a few) is strong, with decades of iterations producing reliable and cost-competitive products.
With wind and solar at record low costs, deployment is where entrepreneurs should focus. The economist Carlota Perez defines two stages of industry change: installation and deployment. A lot of capital is thrown at the shiny new invention in the installation phase. But significant capital is returned to entrepreneurs and limited partners in the deployment phase through creative ways of distributing, marketing and financing.
Studies show that all we need to do is install more panels, turbines and efficient products to get us to 100 percent emissions-free energy. Clean-energy founders should take lessons from Jigar Shah, one of the original founders of SunEdison, who didn’t invent a new technology but made an innovative technology accessible.
We need more innovative ways to market, distribute and finance solar and wind. My company, Arcadia Power, does just that by coupling a behavior nearly everyone does every month — pay a power bill — with clean energy through renewable energy certificates (RECs).
REC markets have existed for decades but with little innovation, and traditionally, only Fortune 500 companies and local governments were able to participate. An REC market acts as a type of carbon market, where instead of a tax on pollution, the positive externalities of renewable production are subsidized by the market. Arcadia Power is giving customers access to these markets nationwide for the first time and for free, making it easier for the average consumer to make an impact.
In addition, Arcadia Power’s community solar has the potential to completely replace the efficacy of rooftop solar. Community solar comes in many forms, but the basic premise is a centralized solar array that allows customers to subscribe to some portion of the output and receive bill savings.
Community solar solves two of utilities' biggest gripes with rooftop solar:
In a progression seen over and over again by successful business model innovation companies, Uber is now one of many firms leading research and development in autonomous cars. This technology might not be where it is today had profits not been rolling in from the business model innovation that preceded it.
Airbnb didn’t invent couch-surfing, Uber didn’t invent car-pooling, and Jigar Shah didn’t invent solar power. But they each made accessing these services easier for the consumer. Instead of focusing on Bill Gates’ moonshots, clean-energy entrepreneurs should use the impressive solar, wind and software technologies we already have to get us to a renewable energy future — faster.
Image credit: Pixabay
Kiran Bhatraju is the Co-Founder and CEO of Arcadia Power, the first nationwide renewable energy company. Bhatraju and founding partner, Ryan Nesbitt, created Arcadia Power with the mission to change the way America consumes energy – from fossil fuels to renewables. Previously, Bhatraju was a founder of American Efficient, an energy efficiency technology company, and worked as a policy aide on Capitol Hill. He is on the board of the Environmental Voter Project and is a published author.