July 1, 2009
Category:
The growth opportunities of developing countries will rely strongly on
the availability of cheap energy only if those countries wish to pursue an economic model now proven by the developed world to be nothing more than a massive progress trap. If anything, as compared to developed nations, many developing countries are positioned in a better place strategically because their economies have not locked them into self-defeating infrastructure choices such as highways, suburban sprawl, big box chain stores, fast food, expensive health care, resource wars, and so on.
I believe a clean energy future, for developed and developing nations alike, will rely not on fossil-fueled growth, but instead on a global web of communication and
information sharing between nations
(admittedly, afforded at present by the "progress trap" of fossil-fueled
development). The information sharing will occur in virtual spaces, but local networks of real people, via organizations like
One Earth Designs, will be instrumental in the design,
deployment, and implementation of physical technology in real communities.
Knowledge sharing tools that are emerging rapidly in the Web 2.0 environment are already allowing people on opposite ends of the globe to share ideas, thoughts, concepts, successes, failures, praise, criticism, problems, and solutions at an unprecedented pace and with a transportation footprint that is just a tiny fraction of what physical presence would cost. One affordance of such technology may be a global leap in consciousness of what makes good business sense, and therefore what commands economic value. Hopefully not too long from now, we will laugh at the absurdity of burning our ancestors in order to get to the store for a pack of hot dogs.
As
Joost pointed out in his
comment
on this week's question, developing nations will only leapfrog the
economic status of developing countries if they innovate themselves out
of poverty with solutions that address scalable energy
consumption as well as clean energy
production via solar, wind, nuclear, or cleaner carbon.
A number of localized, strategic measures could employ entire
communities to develop and operate ecologically integrated cities with
green roofs, big garden commons, high density, reliable infrastructure, pedestrian friendly pathways, human-
and electricity-powered forms of transportation, and energy-efficient buildings tuned to local conditions. By combining reductions in resource consumption with advances in clean energy production, we stand the best chance of eliminating the need for fossil fuel consumption which drives so much global instability. Also, it's worth pointing out that many of these
socially beneficial arrangements are process-driven and therefore labor intensive. Innovative solutions should be enacted in a way that considers the effectiveness of human beings as living creatures, first and foremost, participating as active members of living eco-systems. We probably can't afford to "utilize" people (or any natural systems, for that matter) as "resources" for much longer before populations rebel or Nature buckles.
In designing our future, we are perhaps best off following principles of organizations like
ZERI (Zero Emissions Research and Initiatives) who view waste as resource and seek solutions using nature's design principles
as inspiration.
Posted by Grant Kristofek at 12:16 PM • 3 Comments • 0 TrackBacks
June 30, 2009
Category: Cap and Trade
At risk of sounding like a broken record, one full of mixed metaphors, the answer to the leapfrogging challenge is the same old same old: If it costs enough to emit carbon, then skipping fossil fuels in favor of clean renewables will be a rational choice for even the least developed country. And of course, it's not the least developed nations we're really worried about. Those folks have such a low per capita carbon footprint that it really doesn't matter what technology they choose. It's China and India that matter.
Read on »
Posted by James Hrynyshyn at 7:29 AM • 3 Comments • 0 TrackBacks
June 29, 2009
Category:
The growth opportunities of developing countries rely strongly on the availability of cheap energy. Today, cheap energy is often generated by burning coal or other fossil fuels. Hence, economic growth and energy consumption are tightly coupled with the rise of carbon dioxide emissions. The challenge is how developing countries can avoid following the development path of industrialized countries by leapfrogging to cleaner forms of energy production. The political debate frequently points to the role of technology transfer in leapfrogging. Yet not much has been achieved so far. What is the potential for leapfrogging? What are its barriers?
Posted by Jonas Meckling at 8:54 AM • 1 Comments • 0 TrackBacks
June 18, 2009
Category: Politics or technology?
Should carbon capture and storage be part of a sustainable energy system? Maybe. Will it be in the foreseeable future? No. It's not a stretch to use the well-worn description applied to fusion power: it's 40 years away and always will be.
Read on »
Posted by James Hrynyshyn at 10:00 AM • 10 Comments • 0 TrackBacks
Category:
Oil, gas and coal are likely to remain key energy sources for decades. For instance, electricity generation in the US continues to rely heavily on coal for reasons of domestic availability and cost. Given its large coal reserves, the US is often referred to as the "Saudi Arabia of coal".
Against this backdrop, much brain power is directed towards ideas how to make fossil fuel-based energy production sustainable. The notion to capture carbon dioxide from the burning of fossil fuels has been increasingly gaining currency. The captured carbon dioxide would be stored under ground in reservoirs to avoid further carbon dioxide emissions to the atmosphere. While some point to the great potential of the technology, others stress the risks involved with it. Should carbon capture and storage be part of a sustainable energy system?
Posted by Jonas Meckling at 4:55 AM • 5 Comments • 0 TrackBacks
June 9, 2009
Category:
I have my doubts that Mencken was the first to come up with the "For every problem there is a solution that is simple, neat and wrong" aphorism. So axiomatic is it that it seems that one could find similar versions dating back to the construction of the pyramids, or least the Roman aqueducts. The idea that slapping a price on carbon will be sufficient to kick humanity's fossil-fuel habit is no exception.
Read on »
Posted by James Hrynyshyn at 7:32 AM • 11 Comments • 0 TrackBacks
June 7, 2009
Category:
Cap-and-trade schemes or carbon taxes establish a price on greenhouse gas emissions. In theory, such a price would drive investment toward low-carbon technologies. Yet, in reality, as Grant and James have argued, cap-and-trade schemes could potentially fall short of sending strong signals to investors for a number of reasons. Today the price for one ton of carbon dioxide in the European Union Emission Trading Scheme is 14 euros. This is too low to get a range off clean energy technologies off the ground. It is likely that cap-and-trade schemes will only become effective regulatory instruments over time as caps are tightened.
Alternative measures to pricing carbon include classic command-and-control regulation such as fuel economy standards or, more generally, energy efficiency standards. Another option is to grant subsidies or tax rebates for investments in renewable energy technologies. Yet again others might argue that the biggest subsidy for low-carbon energy technologies would be to simply cut back on subsidies for fossil fuel industries. In short, is pricing carbon enough to stimulate investment in clean energy technology? If not, which flanking measures are necessary?
Posted by Jonas Meckling at 1:00 PM • 6 Comments • 0 TrackBacks
June 3, 2009
Category: Cap and Trade
Is a cap-and-trade scheme a good way to create incentives for a low carbon-future?
What would an effective cap-and-trade strategy look like?
At first glance, the new energy legislation introduced in the "American Clean Energy and Security Act of 2009" (ACES, summarized here) appears to have a pretty good shot at motivating some real and effective results. The 932-page bill is a comprehensive and ambitious outline of a potential strategy.
The discussion draft, introduced in late March 2009 by House Energy and Commerce Committee Chairman Henry Waxman (D-CA) and Energy and Environment Subcommittee Chairman Edward Markey (D-MA), sets out to "create millions of new clean energy jobs, save consumers hundreds of billions of dollars in energy costs, enhance America's energy independence, and cut global warming pollution."
The bill seems to address most of the factors essential to solving the global climate and energy crises. For one, it motivates "clean energy" by promoting renewable energy sources, a smart grid for more efficient electricity transmission, low-carbon fuels for transportation, clean electric vehicles, and carbon capture and sequestration (CCS) technologies. It seeks to increase energy efficiency across all sectors of the economy including buildings (which represent 40% of US energy use), transportation (28% of US energy use), and industry (32% of US energy use). ACES also provides incentives for reducing tropical deforestation which accounts for about 20 percent of global greenhouse gas emissions each year - more than the combined emissions
of every automobile, train and plane on the planet. Additionally, the bill promises to ease the transition and ensure domestic competitiveness with federal- and state-level aid in the forms of green job creation, consumer assistance, funding for climate change adaptation projects, and clean technology exports to well-intentioned developing nations.
Most importantly, however, ACES introduces provisions to reduce global warming pollution, modeled on recommendations of the U.S. Climate Action Partnership (USCAP), a coalition of electric utilities, oil companies, chemical companies, manufacturers, and environmental organizations. The proposed market-based cap-and-trade program aims to reduce global warming pollution from oil companies, electric utilities, large industry, and others that collectively are responsible for 85% of U.S. global warming emissions.
Under the plan, entities that emit more than 25,000 tons of CO2 per year are required to have tradable federal permits, called "allowances," for every ton of greenhouse pollution they emit into the atmosphere. Each year, the program will reduce the number of available allowances to ensure that total emissions become increasingly limited relative to 2005 levels. Companies may exceed their permitted emissions by trading allowances, or they may also purchase a limited number of offsets (not to exceed 2 billion tons in any year) from competing sources at a rate of 5 tons offset credits for every 4 tons of emission being offset. Additional flexibility has been built in through proposed programs for banking and borrowing allowances and with the creation of a "strategic reserve" to be made available by auction if allowance prices rise to unexpected levels.
On paper, the plan makes good sense, but practically, it will face several challenges.
First, the bill will have to survive a complex battle through the House to gain the 218 votes needed for its passage into law. If it is watered down too much and passed, the bill may end up representing nothing more than a leg-iron for trade and real progress on climate change.
Secondly, the cap-and-trade system will require unprecedented transparency and accounting accuracy to ensure its effectiveness and to prevent fraud. ACES puts many provisions in place to address this issue, but given the recent track record of our federal government at regulating complex accounting, I remain dubious.
Third, there is a very real possibility that we simply won't be able to meet the goals set forth in the bill. If we are to slip beyond those benchmarks, it's not immediately clear how we will get ourselves back on track to reduce emissions enough to avert apocalyptic climate ruin as predicted in a message delivered this week by a group of Nobel laureates meeting in London.
We don't have much time to get this right, and it's very important that we move quickly and decisively, but we must also make sure that we bet on the right horse before the gates open.
I look forward to hearing the debate before I put any of my money down.
Posted by Grant Kristofek at 12:03 PM • 2 Comments • 0 TrackBacks
June 2, 2009
Category:
As commenters have already pointed out, the authors of the ACES Act (under the direction of Waxman and Markey) could have harnessed the power of the free market to bring about the kind of reductions in greenhouse gases required to avoid catastrophic climate change, but failed. This is because they, and everyone else who's being honest about the subject, knows that the last thing the captains of industry and the consumers they command want is a truly free market.
Read on »
Posted by James Hrynyshyn at 7:39 AM • 2 Comments • 0 TrackBacks
May 30, 2009
Category:
On May 21, the Energy and Commerce Committee of the US House of Representatives passed the American Clean Energy and Security Act, which had been proposed by Congressmen Markey and Waxman. While the bill has yet to pass a number of hurdles before becoming law, the momentum for federal energy and climate legislation is growing significantly in the US. If passed, the bill would establish a cap-and-trade scheme. Such an emissions trading scheme puts a price on carbon dioxide emissions by limiting the absolute amount of emissions. Emitters would be allocated emission permits which they could trade in case they have more permits than actual emissions. If regulated entities emit more than their permits allow them to emit, they would have to buy additional permits.
Emissions trading harnesses market forces to protect the environment. It creates a new financial market that should provide incentives to reduce greenhouse gas emissions and to invest in clean energy technologies. Yet it has long been controversially discussed whether emissions trading is the best way to channel investment into a more sustainable energy infrastructure. Other policy options include carbon taxes, technology standards and subsidies for clean energy investments. Against this backdrop this week's question asks: Is a cap-and-trade scheme a good way to create incentives for a transition into a low-carbon energy future? What would make an effective cap-and-trade system?
Posted by Jonas Meckling at 12:16 PM • 5 Comments • 0 TrackBacks
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