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The alternative to the “Clean Deployment Consensus” is also unclear

by Carey W King

Belief in future rate of innovation progress is also not a guaranteed solution to “long-term” climate mitigation

I recently read over the report Challenging the Clean Energy Deployment Consensus by Megan Nicholson & Matthew Stepp for The Information Technology and Innovation Foundation.  The authors define the “clean energy deployment consensus” as those (e.g. Amory Lovins, Al Gore, Mark Jacobson of Stanford) that believe clean (low-carbon) energy technologies are already sufficient to substitute for fossil fuels, and all we need to do is quickly manufacture and install them at a large enough scale to displace fossil fuels.  Contrary to purveyors of the “clean energy deployment consensus,” the authors believe that existing clean (low carbon) energy technologies are not yet sufficient to effectively mitigate climate change and economically substitute for fossil fuel energy supplies:

“Climate change is a real, serious, and persistent challenge, but solving it will require policies that will enable clean energy technologies to be cost and performance competitive with fossil fuels.”

Thus the authors believe that economic viability is the (or one) major driving factor for technology substitution.  They further believe that the only way to achieve cost and performance competitiveness with fossil fuels is for a focus on innovation research instead of simply deployment of existing technology:

“By encouraging policy and investment efforts to support innovation now, breakthroughs in clean energy technology and energy storage will eventually be able to turn off the faucet [slow carbon emissions]. The sense of urgency concerning climate change is important, but policies to address mitigation must incorporate a long-term view of the problem.”

I counter that the belief in future innovation progress is not necessarily a “long-term” view of the problem more than betting (and believing) on the unknown future.  We have the choice of investing in technologies that we know now, or waiting for technological advancement that we don’t know will arrive. Innovations in renewable energy and energy storage will be challenging to say the least if the goal is to match the energy service delivery of our current energy system dominated by fossil fuels with considerable hydropower and biomass.  There will need to be as much technological innovation in energy efficiency and conservation as innovation (meaning a decrease) in mass consumption habits.

In terms of assessing economics, the “consensus challenge” authors use the “conservative” assumption of installing renewable energy at 2.1 million dollars per megawatt (MW), or 2.1 $/W, of capacity from Mark Delucchi and Marc Jacobson’s 2011 paper on powering the world 100% on wind, water, and waves.  Nicholson and Stepp estimate 8 percent of global GDP for 20 years is the required investment ($100 trillion over 20 years from 2010 to 2030).  This is an interesting and important check to feasibility, though not in a way that the report authors mention.  For energy expenditures near or over 10 percent of GDP in the United States (for example), these time periods have corresponded to the deeper recessions since the end of World War II. There is a great need to understand the threshold percentage of energy (and food) expenditures that inhibit growth in different types of economies.  See my past blog indicating that the percentage of household expenditures on energy and food started increasing in 2001 in the U.S. after decreasing since 1945.

Further, the report authors are generous in their analysis in using an assumed capacity installation of $2.1/W.  We have already seen mass installation of nuclear and coal-fired power plants along with wind farms and hydropower facilities.  All energy technologies get cheaper as they are manufactured and installed to a certain level of deployment, but no energy technologies decreased in cost forever.  No future energy technology will avoid this same fate. The shift to low carbon and renewable energy is so fundamentally different that we can expect a larger share of the economy to be part of the “energy sectors” because of employment, and thus wages.

The Nicholson and Stepp further argue:

“Scenarios like these [renewable energy futures] ultimately exclude alternative zero- and low-carbon technologies from projections in order to achieve high renewable market penetration, instead of prioritizing the maximization of GHG emission reduction as quickly, efficiently, and cost-effectively as possible.”

It is worthwhile to envision different future scenarios, and certainly we should consider all options, but there is no guarantee that nuclear power and carbon capture and storage systems will be any more economically acceptable than renewable energy systems. The report authors conclude with:

“When clean energy is genuinely cost- and performance-competitive with fossil fuels, developing nations—and the world as a whole—will not have to choose between higher energy costs and climate change mitigation.”

The difficulty with this statement is that we do not know “when” clean energy will be both cost- and performance-competitive with fossil fueled technology.  This could be because fossil fuels become more costly themselves (e.g. oil prices are staying at a new high level since the run-up in prices from 2004-2008).  Hydraulic fracturing has certainly opened up a large quantity of formations that house natural gas and hydrocarbon liquids, though it is not clear yet as to the price points to access all of these resources and convert them to reserves.

But might we “… have to choose between higher energy costs and climate change mitigation.”?  Perhaps the authors meant “between lower energy costs and climate change mitigation” as today we can have higher energy costs while mitigating carbon emissions. But the fundamental question is there: internalizing carbon emissions into the energy system is dealing with the largest externality to date (and likely ever). Internalizing carbon emissions will cost more than by not internalizing emissions.

The author’s faith in innovation from research uses a pervasive story attempting tom compare energy generation technology to energy consuming, information processing, technology of semiconductors:

“A frequently used analogy to illustrate the potential of breakthrough innovation to generate cost declines is the exponential growth in processing power for computing by the semiconductor industry. Recently there is renewed debate over whether the industry will be able to sustain such rates of progress, which is a comparable conversation to that happening within the renewable energy sector, as solar and wind technologies have seen significant cost declines in recent years. The main difference, however, is that while the energy industry continues to emphasize deployment as the key to cost declines, the semiconductor industry is again engaging in a conversation about how to effectively improve innovation systems and processes to stimulate new and cheaper breakthroughs in computer chip technologies.”

This paragraph does correctly emphasize the need for continued focus on innovation.  But the semiconductor is an example of the focused application and consumption of more energy to process and organize more information, whereas energy generation technologies must be concerned with the energy inputs to their life cycles as much as the energy outputs.  The landscape is littered with dot-com and Silicon Valley entrepreneurs trying to duplicate their innovation models for biofuels and low-carbon energy.  This has not worked to date, but there could be some future successes. Most of the successes aren’t in providing new fuels and generation technologies, but in creating new ways to consume the same or less energy (e.g. Elon Musk and Tesla). But in a twist to my own writing in this paragraph, it could be information that we lean on to substitute for services largely served by direct energy consumption.  And along the way, we’ll keep a look out on the increasing energy it takes to keep our information available on-demand every second of every day – ahem … for example the server hosting this blog article …

About Carey King

Dr. Carey W King performs interdisciplinary research related to how energy systems interact within the economy and environment as well as how our policy and social systems can make decisions and tradeoffs among these often competing factors. The past performance of our energy systems is no guarantee of future returns, yet we must understand the development of past energy systems. Carey’s research goals center on rigorous interpretations of the past to determine the most probable future energy pathways. Carey is a Research Scientist and Assistant Director at the Energy Institute at The University of Texas at Austin, and appointed also at the the Center for International Energy and Environmental Policy within the Jackson School of Geosciences and Business, Government, and Society Department of the McCombs School of Business. Visit his website at: and follow on Twitter @CareyWKing
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