An Energy Model for the Future, From the 12th Century


There's a story, well-known among renewable energy buffs, that illustrates the power of technology to disrupt society better than any other I know.

Throughout the Middle Ages, the abbey in Bury St. Edmunds had monopoly rights to the use of the local river as a power source. And, indeed, the abbey operated the only water mills for miles around. The village farmers had no choice but to bring their grain there and to pay whatever was asked to have it ground.

One can imagine the grumbling that must have prevailed among the local folk. But, year after year, decade after decade, nothing changed. Finally, as the 12 century waned, a small farmer and low-level churchman called Dean Herbert broke ranks and decided to build a windmill on his property, saving himself both the grinding tariff and the carting costs.

Getty Images

Perhaps he was a bit naïve in failing to realize that his windmill represented a direct challenge to the very heart of feudal authority. In any case, the monastery's boss, Abbot Samson, once informed, lost no time in charging off to Herbert's farm to straighten him out on that very point.

Herbert, standing on the dirt track that led to the mill on what I imagine to have been a gray, blustery day, with the crude windmill creaking at his back and his simple cloak whipping around him, made a reply that rings down through the centuries; a reply that, to me anyway, is as inspiring today as it must have been chilling to the aggrieved abbot.

Herbert said: "I have this right on my free fief; the benefit of the wind ought not to be denied to any man."

(Read More: What Dooms Innovation to the Graveyard?)

Although his words had enough impact at the time to be recorded in the monastery's journal, they didn't save the mill. Herbert tore it down rather than suffer his abbot's wrath. But only a few years later, hundreds of windmills dotted the English countryside, and the dark ages began their slow, painful ascent into the light of the Renaissance and the modern era.

There were, of course, many other factors contributing to the demise of the feudal order. But the democratization of energy played a conspicuous role in England and elsewhere. Such is the power of technological advance. Windmills weren't the first technology to disrupt the energy landscape, and certainly not the last.

Most recently, hydraulic fracturing ("fracking") combined with horizontal drilling has made natural gas cheap to obtain and turned the U.S. from a gas importer to an exporter in just a few years.

(Read More: Recipe for Disruption Leans on Lazy Incumbents)

But back to the 12th century for a moment. The fact is that wind isn't as good a power source as flowing water. It was adequate, barely, for grinding grain; but wind is catch-as-catch-can. Water is steadier, more reliable—especially if there's a millpond upstream to assure a steady supply.

So before history can repeat itself and wind power (or solar power) can once again challenge the established order, whether it be an authoritarian regime in the developing world or a regulated utility in a Western democracy, it needs to be made dispatchable—available on demand. It needs storage.

Cheap large-scale energy storage tied to intermittent renewable generation (industry jargon for wind and solar power) offers two benefits, one relatively benign and the other deeply disruptive:

First, the combination of renewable generation and storage can displace fossil fuel-based generation—taming the unpredictability of renewables puts them on the same footing functionally as, say, a coal plant.

Second, the renewables-plus-storage combination reduces or eliminates the need for a central power grid. Power generation can be distributed and local. The grid reflects the economies of scale and logistics required to generate electricity from fossil fuels; and leading inevitably, like Abbot Samson's water wheel, to monopolistic authority.

But, no one has to deliver the sun or wind to your town or to your campus or business park. Storage changes the balance. It's the key to turning energy from a centrally controlled resource into a distributed asset available to anyone … provided, always provided, that the economics make sense.

Solar, in particular, is cheap and scalable. Storage is still expensive. It has to be half or a third of today's cost to truly enable the disruption that seems tantalizingly close.

(Read more: What Netflix and IBM Can Teach Us About Disruption)

We take for granted now the impact that distributed communications have had via mobile phones. Electrical energy has that same democratizing power. And energy storage, at the right price and scale, has the potential to put that power once again in the hands of this century's Dean Herberts.

—By Steve Crane, co-founder and CEO of LightSail Energy.

LightSail Energy, which is working on an energy storage solution able to convert electrical energy to compressed air, and then reverse the process to deliver electrical energy again when it's needed, was named to the inaugural CNBC Disruptor 50 list.