Energy in the 21st Century: Resources, Conversions, Costs, Uses, and Consequences

Summary of Study

Bottom Line: Humankind's economic advances in the 20th-century are correlated with an unprecedented rise in energy consumption, especially oil. Improved technology, extraction, and transportation significantly reduced energy prices over this period. Hydrocarbons are at the heart of that evolution. 

The 20th-century was the first era dominated by fossil fuels, and the 16-fold rise of their use since 1900 created the first high-energy global civilization in human history. Several substantially improved late-nineteenth-century inventions—above all, electricity generation and transmission systems, and internal combustion engines—shaped twentieth-century societies.

Incessant technical innovation has been by far the most important determinant of this energy transformation. It has been responsible for impressive growth of capacities, flexibilities, and efficiencies of energy converters, as well as advances in exploration, extraction, transportation, and transmission.

In spite of the near quadrupling of global population—from 1.6 billion in 1900 to 6.1 billion in 2000—the average annual per capita supply of commercial energy more than quadrupled from 14 GJ to roughly 60 GJ.

Although concerns about the exhaustion of fossil fuels were raised repeatedly during the 20th-century, the actual availability of all fuel reserves continued to grow. Increased efficiency of energy conversion was perhaps the most notable universal 20th-century trend brought about by technical innovation and invention. In 1900 only about 20 Mt of crude oil were extracted worldwide, nearly all of it in a handful of countries. Rapid progress in production followed, thanks to technological advancement.

20th-century cropping has been profoundly transformed by fuel and electricity inputs used directly by field machines and by irrigation, and indirectly to produce machinery and agricultural chemicals, above all to synthesize nitrogen fertilizers.

An impressive correlation exists between the global consumption of commercial energy and the world’s economic product during the 20th-century. There's a highly significant statistical association between rising per capita energy use and a higher physical quality of life measured by adequate health care, nutrition, and housing. Higher efficiencies of energy conversions transformed the use of fuels and electricity during the 20th-century. 

The consistent 20th-century declines in energy prices illustrate the combined power of technical innovation, economies of scale, and competitive markets. Higher efficiencies of energy conversions transformed the use of fuels and electricity during the 20th-century.

In spite of being heavily promoted and supported by public and private funding, contributions of nonfossil energy sources ranging from geothermal and central solar to corn-derived ethanol and biogas remain minuscule on the global scale.

Read the full study here. 


Feature Charticle

U.S. Electricity Prices, 1900-2000

University of Manitoba


  • Impressive secular declines of energy prices reflect the combined power of technical innovation, economies of scale, and competitive markets.
  • In 1902, U.S. national average energy prices were 15.6 cents/kWh, yet by the late 1990s, the average was just around $0.06 (both figures in 1990 dollars).
  • With quintupled disposable incomes and doubled to tripled efficiency of lights and electric appliances, a unit of useful service provided by electricity in the United States was at least 200, and up to 600 times, more affordable in the year 2000 than it was in 1900.
  • Energy intensities rise during the early stages of industrialization, peak, and then decline as economies use energy more efficiently. 
  • The long-term record shows that energy intensities are not preordained and that they can be altered both by gradual technical change and by determined policies.

Read the full study here.