Energy innovations and the economy: An historical overview

Abstract

This chapter provides an introductory overview of the use of energy in relation to the economy over time. Energy consumption has skyrocketed with the course of time and energy is being used for increasingly more purposes. Especially societal, industrial and technological change brought about a dramatic increase in per capita energy use. Specific attention is paid to how changes in the use of energy sources and innovations come about. Here, we provide different views of energy transitions: the entrepreneurial perspective, the socio-technical perspective, and the economic-political view. In case energy efficient innovations induce an increase in energy consumption that partly offsets the energy savings, there is a so-called rebound effect. This effect occurs in both consumption and production. Furthermore, the role of energy in the current economy is discussed as there are widely different views about how important energy actually is for economic development.