INSIDE THE HOUSING EVOLUTION by Matthew Sachs

The Third Industrial Revolution

I just finished a very thought provoking book called “The Third Industrial Revolution”, by Jeremy Rifkin.  Rifkin’s theory is that the world is on the cusp of a Third Industrial Revolution that will change the world’s economies and societies as dramatically as the First and Second Industrial Revolutions had in the 1800s and 1900s.  The reason I found this book so fascinating is because it creates a compelling narrative, or framework, that explains many of the changes  I’ve seen taking place both in my industry, as well as in society as a whole.

Rifkin notes that each Industrial Revolution can be linked to innovations in both communications and energy.  The First Industrial Revolution was characterized by steam powered printing technology, greatly encouraging mass literacy for the first time in history.  Coal was the primary source of energy for an economy based on industrial factory manufacturing and a rail system that spanned continents.  Worldwide average income and population growth increased dramatically as a result.  The Second Industrial Revolution was characterized by the advent of radio and telephone communications, and the use of electricity in homes.  And of course the automobile and interstate highways that came with it changed the way that cities were built and ushered in the oil economy.

The Third Industrial Revolution, according to Rifkin, will be characterized by the rise in Internet communications technologies and renewable energy.  What these two technologies have in common is that they both function in a distributed way.  The internet is built off of millions of computers linked together with no central power controlling it.  Similarly, Rifkin foresees a future where millions of people generate their own green electricity and share it with one another across intelligent electricity networks.

The cultural and economic implications of this are staggering.  The technologies associated with the First and Second Industrial Revolutions, such as coal and oil extraction and refining, and rail and highway infrastructure, are extremely capital intensive.  The high costs led to a hierarchical economy with monopolistic utilities controlling the flow of information and energy.  Because the sun and wind are essentially free (once the renewable energy infrastructure is in place) our society can transform to a collaborative economy where we gain more value from sharing resources rather than buying them.  By analogy, consider how traditional media such as newspapers and television are being changed by user-generated content such as blogs and Youtube (remember the Encyclopedia Britannica?).  The implications of people sharing renewable energy over a distributed grid are equally world-changing.

So what does this all have to do with homes?  In Rifkin’s vision of the future, every home will become a net-exporter of energy where we generate more electricity than we use over the course of a year.  This is what is driving us towards Net-Zero Energy Homes.  We will start by making the homes as energy efficient as possible, and then add solar photovoltaic technologies to our roofs to convert sunlight to electricity for our own uses and for exporting the leftover energy to the grid.  We are already on this path, with industry experts predicting that all new homes will be Net-Zero Energy by 2030.  In fact, many believe that the changes will happen much quicker.

Urbandale is already on the path towards building Net-Zero Energy Homes, however our focus is on production building, not custom building.   We are waiting for the necessary technologies to become available at prices that are affordable and marketable to consumers.  For example, solar photovoltaics (PV) are currently an “add-on” technology, meaning that we build a house, and then hire a third-party company to come in and install PV on the roof.  This is expensive and inefficient, and it also can increase the chance of leaks due to the necessary holes in the roof to support the PV brackets (although if installed correctly this is should not be an issue).   We currently build our houses as “Solar-Ready” so that purchasers can choose to install PV at any time after they have moved in.  The costs to the consumer are essentially the same whether we install the PV for them, or if they do it themselves later. The next generation of PV technology is called Building Integrated Photovoltaics, or Solar Shingles.  With this technology, the roof shingles themselves are capable of converting sunlight to electricity.  Although this technology is still being developed, once it becomes available it has the potential to transform the market.  The renewable energy component will truly be integrated within the house and not simply added to it afterwards, saving money and effort.