The Third Industrial Revolution: How Lateral Power Is Transforming Energy, the Economy, and the World

Economist, author, and entrepreneur Jeremy Rifkin has been an advisor to the European Union for the past decade and a lecturer at Wharton. He’s well known in the EU and more recently the US for pushing the ideas behind “Third Industrial Revolution.” It makes a lot of sense to anyone that was born after 1983.

The first industrial revolution was the advent of steam engines, railroads, advances in machinery and factories. The second industrial revolution was spurred by cars, telephones, faster transportation networks and eventually the internet.

The third industrial revolution goes something like this: Rather than have centralized power plants and grids (both fossil and renewable), it makes more sense to have a decentralized power grid. Every house and every building would have their own solar panels/renewable energy; each building thus effectively turns into its own little power plant.

Energy that isn’t used can be stored using hydrogen fuel cells and distributed/shared/sold on a decentralized grid to other people who want energy. It’s what the internet did for information, except for energy.

This idea isn’t new and has been discussed for a couple of decades, but has been slow to gain traction in the US. That said, cities in the US like San Antonio have been pushing for big clean energy initiatives.

Decentralized energy grids have already being developed in major cities across Europe, Germany leading the way. More than a million + people now participate in providing electricity – private residents and farmers own almost half of the installed capacity of renewable energy installations in Germany.

China, despite it’s image as being perpetually engulfed in smog, is actually leading the way in renewable energy investments.

He also believes that we’re moving away from globalization. To paraphrase the two sides of the debate on globalization:

– Advocates of globalization: “It’s amazing that you can get a tomato from halfway across the world.”

– Critics of globalization: “It’s ridiculous that we need to ship a tomato halfway across the world.”

Jeremy covers a lot to develop his argument — from the history of economics, industrial revolutions, clean energy, decentralization — and there’s something new I learned in each chapter.

Topics that are covered in the book which fascinated me:

-Why property rights are a recent social construct and how Enlightenment thinkers and later on were influenced/blinded by Newtonian physics

-Why productivity rates have been hovering at 14% since the 1970’s and why 85% of our economic productivity is wasted

-How the laws of thermodynamics have been ignored by economists for decades and the negative impact this has had on the environment

-The death of Adam Smith and the myth of the invisible hand

-Why globalization is declining and being replaced with a more sustainable “continentalization”

Who should read this book:

If you’re even slightly concerned about the direction we’re headed in as a planet and how a new, sustainable, energy-paradigm might look like, this book will rock your socks.

Here’s a quote from the book:

“Millions of Americans want government to keep its hands out of the commercial arena, but are unwilling to mobilize sufficient public response to end the practice of private commercial interests buying elections and directing taxpayers’ money to their pet commercial projects and industry interests.”

Download a full list of my Kindle Notes here: The Third Industrial Revolution or pick up a copy on Amazon.

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