Energy balance climatology emerged from the 19th century thermodynamics and radiation research. Energy balance consideration offered an attractive intellectual ground to apply the conservation principle to a natural process. The climate system was often compared to the processes in a steam engine. Research into this field started with insufficient theory of radiation and turbulence, primitive instruments, and limited observational data. In the course of the last 150 years, energy balance climatology gradually gathered advanced theories, continuously improved instruments, newly acquired observation platforms, such as space, and high performance computational capability. In the present article, the processes of climate formation are examined by going back to the principle of energy conservation. Further, the development of this branch of science is presented in five stages characterized by similar stages of theoretical and technical progress. This review visits important steps in the course of these developments and examines their value in reaching the present stage of knowledge. Although the achievements of the last 150 years are impressive, the present understanding of energy balance is far from sufficient. The main problem stems from the fact that the scientific community has not fully used the outcome of laboratory experiments and precision field observations. As high-quality observations are presently being made throughout the entire world, a new and improved knowledge of energy balance will become available in the near future.