Nick of Time Energy Revolution

We are standing at the threshold of a revolution in the world energy economy. Or, so we might hope after reading this week’s Economist.

The tell-tale signs of that revolution are documented in a 14-page special section on “The Future of Energy.”

The Economist, a magazine that calls itself a newspaper, began publishing in 1843 to “take part in a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress.”

Its special energy section (June 21-27 edition) delivers a bit of both. But it contains plenty of information that ought to be circulated far beyond the periodical’s regular readership.

The feature’s bottom line (liberally paraphrased) is this:

We are at the beginning of a Third Industrial Revolution in which renewable energy technologies — driven by factors such as peak oil, climate change and the old-fashioned profit motive — will permanently transform the global economy and its impact on the environment.

“A fundamental change is coming sooner than you might think,” the newspaper says.

“Everyone loves a booming market, and most booms happen on the back of technological change,” the Economist writes. “The world’s venture capitalists, having fed on the computing boom of the 1980s, the internet boom of the 1990s and the biotech and nanotech boomlets of the early 2000s, are now looking around for the next one. They think they have found it: energy.”

The Economist’s analysis of emerging renewable energy technologies — including wind, solar, geothermal and biofuels — is too detailed to summarize here. It’s worth taking the trouble to read it in its entirety. Here are some highlights:

Unfortunately, the Economist gets a few facts wrong and perpetuates some misunderstandings about our energy choices.

Nuclear power: “The time is right for a rethink” of nuclear power, the Economist writes. Why? Because nuclear power will be cheaper than coal once a price is put on carbon, and because memories are fading about the accidents at Chernobyl and Three Mile Island. Let’s hope that forgetting the past — in this case, the fallibility that the “human factor” injects into nuclear energy — is not a rationale for charting the future. Let’s also be careful about defining price. Nuclear power has been heavily subsidized by the government since its inception more than a half-century ago, and it remains dependent upon corporate welfare today. When subsidies, decommissioning, waste disposal and other costs are counted, nuclear power is no bargain. As the Nuclear Information and Resource Service notes, “Nuclear power one of the least effective and most expensive ways in which to tackle climate change.” More importantly, the Economist brushes off the problems of waste storage and nuclear proliferation as though they are inconsequential and easily solved. They are not.

Coal power: The Economist buys into the specious but common argument that because coal is cheap, abundant and widely available, it is “unlikely to go away” even in “the most alternative-friendly future imaginable”. There are two problems with that conclusion.

First, if price, supply and availability are our criteria, then we should shift all of our public subsidies and research from coal to solar energy and its derivatives. Solar energy is free and omnipresent, it produces no emissions, we have a 5-7 billion year supply and the power is delivered to us in eight minutes. The sun remains the best power plant ever devised.

If we got serious about using solar energy and its derivatives, we could achieve true carbon sequestration by leaving the coal in the ground. Intermittency — the most often-cited weakness in a solar future — can be solved with smarter electric grids and emerging methods of storing wind and solar power — a goal even more important in my book than storing carbon.

Second, speaking of sequestration: While a kilowatt of coal-fired electricity may be cheap today, that will change with carbon pricing and with carbon capture and storage (if storage proves feasible). It’s possible, perhaps even likely, that if carbon capture and storage become ready for widespread use — which even bullish advocates say isn’t likely to happen before 2020 — several forms of renewable power generation will be cheaper. As the Economist notes, seemingly in contradiction to its statement that coal power is cheap: “Carbon storage will be expensive at best. At worst, it may not work.”

Energy efficiency: In another surprising lapse of intelligence for a world-class publication, the Economist confuses energy efficiency with energy conservation, and ignores the importance of both. Energy efficiency, it says, will “just happen in the background as part of most businesses’ continuous search for cost savings.”

Poppycock. Energy efficiency is Job No. 1 in achieving the new economy the Economist suggests is being born. It is the quickest, cheapest and most reliable way to cut carbon emissions and energy costs. A number of public policies, subsidies and market barriers stand in the way of full utilization of even cost-effective efficiency opportunities. That’s why so much efficiency potential remains unused today, like hundred-dollar bills laying unclaimed on the sidewalk. Some barriers will be removed by carbon pricing; others, such as the regulatory policies in most states that give utilities more incentive to sell power than to save it, need to be removed proactively.

Despite these flaws in its reporting, the Economist makes the important case that “a failure of imagination has been at the heart of the debate about climate change”, but now a boom has begun for green technologies. A key question, the newspaper notes, is whether the boom will happen quickly enough to stop atmospheric CO2 concentrations from reaching dangerous levels.

That urgency is why the Third Industrial Revolution needs to be not just an evolution, but a revolution. As Sam Walton put it, “Incrementalism is innovation’s worst enemy. We don’t want continuous improvement, we want radical change.”

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