The Power of Exponential Thinking in Climate Tech
5min to unleash the Exponential Framework for Maximum Impact 💫
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We live in an Exponential Age, and the tech world is governed by exponential laws.
The 3 Exponential Laws
🚀 Moore's Law
Coined by Intel's Gordon Moore, it says that the number of transistors on a chip doubles every two years without costing more.
Translation? Faster tech, same price, every couple of years. It's why your phone is a mini supercomputer!
🛠️ Wright's Law
The idea? The more you make something (like planes or tech gadgets), the cheaper it gets to make. It's all about getting better and more efficient with practice. So, the 1000th gadget is cheaper and quicker to produce than the first.
Fun Fact?
In the energy world, only Renewables have been following Wright's law.
Why is the price of Nuclear not dropping?
Because of that ‘0% learning rate’. In other words, nuclear power has suffered from a lack of research and investment in recent decades. It’s time to double down again.
What about Coal?
Well, coal is not a "technology". It is, quite literally, decayed dead plants. Let's phase it out completely and allow deceased plants to rest in peace... 🍃✌️
👑 The Power Law
The Power Law is the survival of the fittest for startups.
It means in areas like tech and venture capital, a few big winners (think Apple, Amazon) take most of the market's rewards.
How do the 3 Laws combine to dominate the Tech world?
Think of it as an unstoppable 3-step Exponential Framework:
Moore’s Law makes solutions more efficient 🤖
Wright’s Law makes them affordable 🤑
The Power Law decides who scales and eats the world 👑
In other words, first iterations are terrible, expensive and unsexy. Give it 10 years, and they will be efficient, cheap and everywhere.
Cool, but how can they ‘exponentially’ save us?
Glad you asked!
Let’s apply the Exponential Framework to all new hot climate sectors.
Take Carbon Dioxide Removal (CDR) for example. Currently, most CDR solutions are messy, expensive, and not easily scalable.
Enters our framework:
Hundreds of startups nerd it out, research the hell out of this space and explore all uncharted spaces (biochar, enhanced weathering, ocean alkalinity enhancement, Carbon Mineralization, Direct Air Capture…) 🤖
Market forces push them to optimize for scale and achieve the right unit economics 🤑
A lucky few manage to survive and attract most of the VC and government money 👑
In today’s exponential world, timelines get compressed, even in hardware. With sufficient time and funding, CDR solutions will become as mainstream as hopping on a plane 🛫.
After all, it only took 8 years for Jet Engines to go from TRL 5 to TRL 9 and enable commercial flights! 🤯
🔥What are the risks?
Technology is neutral, and markets aren’t always rational.
The main risk I see is that the Power Law could direct most of the money and attention towards the wrong technology, while the real saviors remain underfunded.
What can we do about it?
Fortunately, most people in the Climate Tech are well intentioned. We just need guardrails to ensure that we stay on track and don't deviate from our positive intentions.
And as this industry continues to grow, we must ensure that it remains free from corruption by Big Oil and lobbyists, and doesn’t turn into a COP 28 travesty.
Conclusion
Keep our good old exponential laws in mind when considering investing or funding a new startup. The future might knock on our door much sooner than we think.
The catch? Technologists are often tempted to fund things just for the sake of exploring what kind of animal they could turn into.
But by the time the genie is out of the bottle, it’s too late; the exponential laws have done their job.
So, let’s always start with the end in mind. Envision what a technology and sector could look like at full scale and ensure it’s a leap forward in positive and sustainable land.
Let’s leverage our three exponential laws where they are most needed 🌎✊
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Wright's Law may mean CDR equipment can be manufactured more cheaply, but the main cost of CDR is the energy required to drive it, and the laws of thermodynamics are not going to change to make it any less energy intensive.
The fossil fuel industry are manifestly supporting and encouraging the CDR movement - "The CEO of Occidental Petroleum has said that direct air capture is a way of prolonging the life of the oil industry"
https://www.climatechangenews.com/2023/08/15/direct-air-capture-carbon-dioxide-removal-occidental-vicki-hollub/