The U.S. energy economy is the 2nd largest but most dynamic in the world, a massive complex devouring 6 million tonnes of oil equivalent (Mtoe) every day. Our daily energy supply will continue to be based on the very real market factors of affordability, reliability, and availability, not the trite platitude of “we’re Americans, we can do anything.”
In fact, with an unacceptable 94 million working age Americans not in the labor force (56 million of them women) and 48 million stuck in poverty, it’s quite apparent there’s a lot we can’t do. And one of the things we can’t do is displace dispatchable, 24/7 always available energy with non-dispatchable intermittent energy. No matter what interest groups proclaim or what laws get passed, mandates don’t change physics, and wishing something doesn’t make it so.
Out of 34 countries, the U.S. has ranked 17th in science and 25th in mathematics, but perhaps our biggest mental hurdle is understanding energy scale and the enormity of the energy system that drives our ever-expanding $17 trillion economy. This explains why so many of us continue to believe that wind and solar power will displace fossil fuels,when it fact they haven’t because they can’t.
Despite a relentless quest started by Alessandro Volta in the late-1700s, we still have no way to store electricity large-scale, and despite tens of billions of dollars in support and claims since the 1970s that our renewable energy world is “right around the corner,” wind and solar today supply just 2% of our energy and 6% of our electricity (see here).
And with “efficiency” being mentioned 327 times in EPA’s 128-page Clean Power Plan (CPP) proposal released in June 2014, the “we just need more efficiency to lower electricity demand” argument has no factual basis. In 1990, 1 Mtoe generated about 3.8 TWh of electricity; in 2014, 1 Mtoe generated 4.6 TWh of electricity. Yet, despite this 21% increase in U.S. electricity efficiency, power demand still increased 40%. No kidding…we’ve added 70 million people and $7.3 trillion in real GDP!
California has been unrealistically and unwisely used as EPA’s model for more efficiency and more renewable energy, mentioned 22 times in the CPP, versus the typical state getting 0 mentions. California, however, has power rates 45% above the U.S. average, imports a leading 33% of its electricity, and always leads Eaton’s Blackout Tracker, with 537 in 2014, compared to 178 for 2nd place Texas. In fact, this over reliance on growing neighbors means that “Obama’s Clean Power Plan is bad news for California.”
For impact on minorities, elderly, and low income households, Climate Change is the obsession, ignored is the impact of higher electricity prices and the less grid reliability that hampers our economy by forcing the deployment of naturally intermittent energy. But, these devastating impacts are well known across the pond where the same anti-coal, oil, and natural gas policies have been enacted: it’s been termed “fuel poverty,” andenergy dreams kill.
Just take Europe’s capitals of wind power, Denmark and Germany, both retain some of the best engineers in the world and have spent tens of billions of dollars incorporating wind. Yet, residential power rates there are the two highest in the world, now 42 and 39 cents/kWh respectively, compared to our 12.5 cents kWh.
Even though many of our best wind locations have already been taken, the CPP requires the wind industry to add more capacity in eight years than it added in the previous 120 years. Not to mention the requirement to actually generate massive amounts of incremental electricity, even though wind power is unavailable more often than it’s available. Meanwhile, back here on Earth, with coal and natural gas capacity factors running ~90%, renewables, “my dear, here we must run as fast as we can, just to stay in place.”
Although I implore you to fight much harder than you now do, (we pro-energy people are in the right!), stay strong fossil fuel producers, as the reality of higher costs, less reliability, and rising demand (even amid great improvements in efficiency) smacks us in the face, we will ultimately be scaling back or significantly watering-down many of the anti-fossil fuel laws being enacted or proposed today. And, once again, it will be more affordable and reliable coal, oil, and natural gas that’ll fill the void.
Indeed, just put out by Bloomberg, “Denmark’s Liberal government is to reverse ambitious CO2 emission targets introduced by the previous administration [and] drop plans to phase out coal-fired power plants and become fossil-fuel free by 2050.” Both Spain and Germany are reducing expensive subsidies for wind and solar, and recent patent data indicate “Global hopes for renewable energy fading.” Even the most ardent supporters of renewables have articulated the limitations of naturally intermittent energy:
- “Suggesting that renewables will let us phase rapidly off fossil fuels in the United States, China, India, or the world as a whole is almost the equivalent of believing in the Easter Bunny and Tooth Fairy,” Dr. James Hansen, the “Grandfather of Climate Change,” NASA
- “We came to the conclusion that even if Google and others had led the way toward a wholesale adoption of renewable energy, that switch would not have resulted in significant reductions of carbon dioxide emissions,” Ross Koningstein and David Fork, Google
The Scale of the Challenge (U.S. Incremental Changes 2005-2030)
Sources: EIA; USDA; U.S. Census Bureau
As for other key countries following any example we claim to be setting, that’s not only unrealistic but undesirable. The most significant incremental emitters of CO2 are far too poor and energy-deprived to be so constrained. For example, the average American consumes 6.8 Toe per year, compared to just 0.65 Toe for Indians, and makes 34-times more money! Governments in the developing world realize that more energy is the enabling force behind more human development (see here) and therefore desperately seek to increase personal consumption.
Working in tandem, study after study demonstrates that more energy demand causes more economic growth, and more economic growth causes more energy demand (see page 112 here). No wonder that UN environmental conferences were founded on an apparently now forgotten principle: “The Environment is People and Their Necessity for More Energy.”
To be clear, the developing countries will gladly accept “
funding” from the West to “combat Climate Change,” but when push comes to shove they know to lean on the same affordable, reliable, and commercial-scale energy sources that built the richest economies. The domination of coal, oil, and natural gas isn’t because of a Koch conspiracy Mr. Reid, it’s because they’re bigger…stronger…faster…more energy dense. China, remember, has called new wind farms “vanity projects.” China, with Russia, and India, with Iran, continue to seek huge oil and gas deals with “whoever, wherever” (see here, here, here).
Importantly, California installed cap-and-trade in early-2012 falsely thinking others would blindly do the same. “The irony of this is that once the law passed in California, no one followed suit. No one,” says Former Assembly Speaker Fabian Núñez, who carried AB 32 in 2006 that led to cap-and-trade. It turns out other states might better realize the criticality of more affordable and reliable energy in our goal to grow the economy and improve public health. It’s disposable income that’s the basis of our health, and consumer spending constitutes 72% of U.S. GDP.
That’s why at least 16 states are preparing to sue EPA after the CPP is submitted for publication in the Federal Register. As Michigan just proved, other states could adopt out of fear the Federal government will eventually set their power policies. One Harvard expert says this would be “unconstitutional,” which explains EPA pushing “credit for early action.”
I demand that spiraling poverty, which kills 900,000 Americans a year, immediately re-emerge as our priority issue, particularly since EPA itself has documented the “great progress in air quality“ over the decades – as have I. Every minute, 14 children around the world die from preventable poverty, enabled by a lack of the huge, dynamic, and diverse energy supply we now take for granted. Blocking this proven modern energy supply from poor people is about as “anti-environment” as one can get. Indoor pollution from using primitive fuels like dung/wood/crop waste kills 4.3 million humans a year, energy poverty now our most tragic afterthought to our computer modeled future.
U.S. Climate Policy is NOT “Climate Insurance:” Incremental CO2 Emissions Won’t Come From the U.S.
Source: IEA, WEO 2014
As for the all-important but very obscure “Social Cost of Carbon” (SCC) being employed to enact or propose anti-fossil fuel legislation, experts at the University of Chicago Law School have already recognized: “A close reading of the cost-benefit analyses performed by agencies in connection with climate regulation reveals much to worry about.” To illustrate, “carbon fertilization” is a major benefit of more CO2 that routinely gets ignored in most SCC. CO2 is essential to photosynthesis, and plant growers regard CO2 as a nutrient.
CO2 generators produce greenhouse levels above 1,000 parts per million (ppm) to double or triple plant growth, compared to the 400 ppm of atmospheric CO2 today. As just one omission, the three Integrated Assessment Models deployed to determine SCC either understate (FUND) or ignore (PAGE, DICE) the great benefits that higher atmospheric CO2 concentrations have on agricultural output in their “cost-benefit” analysis, rendering those assessments glaringly incomplete – an
To demonstrate the problems involved, a 2014 peer-reviewed study found that when carbon fertilization is considered, SCC can be less than $7 per metric ton, compared to the $37 or more SCC that the Obama administration wants to use.Thus, adding the established effect of carbon fertilization to SCC lowers the SCC figured by the Obama administration by over 80%, slashing the negative costs assumed for using coal, oil, and natural gas. In fact, some analyses have found that SCC can even be in the negatives, meaning the benefits outweigh the costs.
No kidding…for 12 years I’ve been documenting how the benefits of our affordable and reliable energy economy built on fossil fuels are so great that they can’t be measured (see here).
But far more straight-forward, Climate Change at core is “undoubtedly and inherently a global issue,” so it’s effectively impossible to show or prove the domestic benefits of CO2 reductions because the decisions of other nations are fundamental to realizing those benefits. And our leaders have no right whatsoever to assume those outside policies in U.S. energy and environmental policy.
In other words, for Americans to realize the “benefits” being claimed by those that use SCC to justify mandating less U.S. coal, oil, and natural gas use, other critical nations like China, India, and Brazil would also have to significantly cut their energy demand and CO2 emissions. In stark contrast, the U.S. could eliminate its entire coal sector and the world would compensate for those saved CO2 emissions within 2-3 years.
More emissions is only logical: our overwhelmingly under-developed world seeks and requires much more energy, not less. India alone has 750 million people that have no refrigeration! As confirmed by Bill Gates, “If you could pick just one thing to reduce poverty, by far you would pick energy.” The crucial IEA and EIA forecasting bodies are projecting a 25-45% increase in CO2 emissions by 2040.
This all points to a worrying and growing regulatory trend to obsess over all imaginable costs of using coal, oil, and natural gas, but to under appreciate or even ignore the most important and obvious benefits of using those fuels. In a world where a rising 6,100 million humans live in undeveloped nations, and fossil fuels are a very telling 85% of the developed world’s energy, such tunnel vision must be fought, endlessly.
Benefits of More CO2 for Global Crop Production Get Ignored in SCC
Source: Center for the Study of Carbon Dioxide and Global Change, October 2013