Of the technical advances transforming the energy business, none is potentially more important than storage. Used on a sufficient scale, it could make heat and light available to those living in subsistence conditions and radically alter the world’s energy mix.

But it is important to demolish two myths. First, the technological advances are not about to transform the energy system to the point where a large proportion of consumers defect from existing distribution systems. Second, it does not require a dramatic breakthrough to become economic.

On the first, by far the most likely next step is the integration of storage mechanisms into existing grids and other distribution systems in ways that manage peak loads and thus contribute to reducing the necessary generating capacity.

On the second, the story is one of gradualism. The core technologies are known and are advancing. Some are already commercially competitive; you are probably reading this on a computer that holds power for much longer than was possible only a decade ago. There could well be developments that would change the entire energy system but a eureka moment is not necessary.

Moody’s notes battery costs have fallen 50 per cent in the past five years. Lazard reports that industry expects a further significant fall in the next five years; and that, if projections are accurate, “some energy storage technologies may be positioned to displace a significant portion of future gas-fired generation capacity in particular as a replacement for peaking gas turbine facilities”.

This suggests advances in storage could rapidly overturn established business models. Many of the technologies already have a strong industrial base, which is helping to reduce production costs. Many more are still at an early stage of commercialisation, building on research in universities worldwide.

There are several storage technologies, each with particular applications. Pumped hydro systems enable us to manage the use of flows of water. Batteries can balance power loads and help manage the challenges of energy supplies that are intermittent. There are also uses at the production and at the consumption end of the supply chain.

Some techniques, such as pumping water, have been used for centuries. Others, such as lithium ion, are not yet commercially viable, but the pace of improvement in costs is impressive.

Storage can be used with any form of supply, from coal to wind, and for any purpose from transport to heating. It improves efficiency by allowing consumers to use energy when they want rather than only at the moment of production. Economically, the greatest impact and the most significant benefits will accrue to the renewables sector, where a greater proportion of supply is wasted and where intermittency forces users into substantial back-up costs.

Technological advances, along with falling costs, promise to make solar the power source of choice in the 21st century. If governments want to decarbonise the economy it is hard to think of a better use for public money and subsidies than researching storage.

The vital point is that storage is growing cheaper at a rate likely to challenge at least part of the existing energy system within five years. The conventional alternatives under threat from this sort of competition start with gas turbines but extend to expensive plans to upgrade transmission lines and distribution systems.

When serious and objective financial institutions start saying such things, investors and companies involved in the old energy economy would be foolish not to take notice of the mounting evidence that storage technology is the next big shift in the energy business.