At a recent Crossroads Lecture, energy policy expert Daniel Kammen spoke about Energizing the Low-Carbon Future. His presentation is timely – climate change has been on the public mind as hurricane superstorm Sandy devastated New York, New Jersey, and beyond. Though we would all agree that energy is an essential part of our daily life, Americans spend more money on potato chips than on energy research and development. Dan has a deep nuanced understanding of where we are at, and where we need to go, to build a clean, sustainable energy future.
In the presentation below, Dr. Kammen explores innovations in, and barriers to, building renewable energy systems worldwide – from villages to large regional economies. He discusses tools already available, and others needed, to speed the transition to a sustainable planet. Daniel Kammen is Professor in the Energy and Resources Group (ERG), Professor of Public Policy in the Goldman School of Public Policy at the University of California, Berkeley. He is also the founding Director of the Renewable and Appropriate Energy Laboratory (RAEL). Kammen advises the World Bank, and the Presidents Committee on Science and Technology (PCAST), and is a member of the Intergovernmental Panel on Climate Change (Working Group III and the Special Report on Technology Transfer).
Dan spoke for about an hour, followed by a 35 minute question and answer session. The Q&A session has some great questions and discussion.
Dan talked about cleantech jobs, the economic benefits of transitioning to renewable energy, climate change, coal, natural gas, arctic sea ice loss, peak oil, the real cost of coal and other high-carbon sources of energy, solar energy, and energy storage. One of my favorite quotes:
When you are spending your funds buying fuels as a fraction of the cost of the technology, it’s a very different equation than when you are investing in people, training, new companies, and intellectual capital. [And so, for example] if you buy a gas turbine, 70 percent of the money that will go in to that, over its lifetime, is not going to be for human resources and hardware, it’s to buy fuel. If you buy renewable energy and energy efficiency, while we have a problem of needing to find ways to amortize up-front costs, you are investing in people, companies, and innovation.
Jobs created, per dollar invested, are consistently higher for cleantech jobs versus old fossil fuel based energy sources. Economist Robert Solow, in his Nobel prize winning work on the drivers of economic growth, demonstrated that about 75 to 80 percent of the growth in US output per worker was attributable to technical progress and innovation. Transitioning to renewable forms of energy will provide strong stimulus to our economy, while reducing public health and environmental costs associated with dirty coal and oil pollution.
After Dan Kammen finished overviewing climate change and energy issues, he highlighted several case studies that featured renewable energy and low-carbon energy production implementations for small (personal), medium (community) and large (national) installations. Watch the video above for more.
I am on a road trip across America, interviewing sustainable business leaders for a new book I am working on. Entering Iowa from the Northwest corner, hundreds of wind turbines rise majestically from the endless corn and soybean fields that are a staple of the Iowa landscape.
Pulling into an access road, I drive up to a newly installed wind turbine that looks like it is ready to be commissioned. It is a GE 1.6 megawatt (MW) wind turbine. The GE on-site engineer has obvious pride as he describes the wind turbine specs, design, and geology of the area that makes this site so amenable to wind power generation.
This wind turbine is located on the Coteau des Prairies, sometimes referred to as Buffalo Ridge. The ridge is composed of thick glacial deposits that gently rise to about 900 feet, from the surrounding prairie flatlands. The ridge runs eastward, from eastern South Dakota, through southwestern Minnesota, and northwestern Iowa. Numerous wind farms have been built along the ridge to take advantage of the high average wind speeds.
Iowa wind power accounts for about 20% of the electricity generated in the state – about 4 billion watts of power (4 GW). Iowa leads the US in percentage of electrical power generated by wind. Wind turbines will produce from 12 to 16 times more revenue per acre than corn or soybeans. And farmers can plant crops around the wind turbine, reaping the benefits of both. In addition, in the winter, winds are stronger, generating much needed revenue while the fields lay fallow.
Coincidentally, I saw this news today, about farmers in the UK ramping up their investment in renewable energy:
More than one third of UK farmers want to install renewable energy projects on their farmland, most of them within the next year, and hope to generate average returns of 25,000 pounds ($40,565) per year, UK bank Barclays said.
The bank’s business arm on Tuesday launched a 100-million pound fund to help farmers finance renewable energy projects, including solar panels, wind farms, hydro plants and organic waste power as a growing number of agricultural businesses seek to benefit from government support tariffs.
“We want to signal very clearly to the market that we consider this to be a big future industry, a big opportunity for agricultural businesses and also a big opportunity for the renewables,” said Barclays Business’ Product and Marketing Director, Travers Clarke-Walker, whose team will be managing the fund.
“This is a quickly emerging industry.”
A Barclays survey of 300 agricultural customers also showed four out of five farmers recognize renewable energy can save costs and 60 percent see it as a source of additional income.
The use of renewable energy on farmland has been brought to public attention in Britain by Michael Eavis, farmer and founder of the Glastonbury music festival, who installed over one thousand solar panels on his land.
The cost of installing renewable energy projects can be recovered after around 10 years, Clarke-Walker said.
The UK government slashed state support for large-scale solar plants earlier this month as it was concerned a few huge commercial projects would scoop up money intended for household and community projects.
Nevertheless, Clarke-Walker expects around 80-90 percent of projects will be solar and wind farms as they are cheapest to build and their costs are forecast to drop by up to 50 percent in the next three to five years as demand rises and technology improves.
Britain aims to generate 15 percent of energy from renewable sources by 2020, compared with 7.4 percent reached in 2010.
The fund’s loan budget is unlimited and the first 100 million pounds could support well over 100 projects as the average cost varies between 250,000-700,000 pounds, Clarke-Walker said.
Suffolk-based farmer Mike Porter, who plants crops such as wheat and oil seed rape, received a 130,000 pound loan from Barclays to install solar panels on a grain store last month and is expected to make 20,000 pounds per year by exporting power to the national grid.
Some good jobs news: “Solar is the fastest-growing industry in the US” according to Rhone Resch, President of The Solar Energy Industries Association (SEIA), during his remarks accompanying release of the quarterly report “US Solar Market Insight.” The report was jointly prepared and released by SEIA and Greentech Media (GTM).
The graphic at right summarizes the stunning growth of the solar industry. Here are highlights from the report:
Solar Driving Jobs Creation
Rhone Resch said that the solar industry employs 100,000 Americans and that that number could double in the next two years. Within a few years, the US will be the world’s largest solar market, according to SEIA.
While California, New Jersey, and Arizona remained the top three states for solar installations, Pennsylvania jumped to the number 4 position, from number 8 in the rank last year. Maryland made the biggest move from 16th to 8th in the ranks.
Solar Growing Fast
Solar electric installations surpassed one gigawatt for the first time, and the US shows signs of being one of the top, if not the top global market for solar in the coming years. New solar photovoltaic (PV) installations for Q1 2011 grew 66% over Q1 2010. Total growth of the US solar market was up 67% in 2010, over 2009.
Solar industry manufacturing growth exceeded 31%, compared to less than 4% for overall manufacturing in the US in 2010.
Solar Pricing Continues To Improve
In Q1 2011 for the solar industry, jobs were up, installations were way up for PV and Concentrated Solar Power (CSP), manufacturing growth was up and prices are coming down. Solar system pricing is down 15 percent from Q1 2010.
While fossil fuels continue getting more and more expensive and extraction of oil, gas and coal becomes more and more toxic, the much cleaner renewable energy sector, including the solar industry, pricing is getting cheaper and cheaper.
Grid-connected PV installations in Q1 2011 grew 66% over Q1 2010 to reach 252 MW.
Cumulative grid-connected PV in the U.S. has now reached over 2.3 GW.
Cumulative grid-connected solar electric (PV and CSP) has now reached 2.85 GW.
The top seven states installed 88% of all PV in Q1 2011, up from 82% in 2010.
Commercial installations in Q1 2011 more than doubled over Q1 2010 in 10 of the top 21 states.
U.S. module production increased by 17% relative to Q4 2010, from 297 MW to 348 MW. While production from export-oriented firms and facilities dipped materially because of soft demand in the key feed-in tariff markets of Germany and Italy, plants that serve the domestic market enjoyed far healthier utilization of manufacturing capacity.
After a year of flat-to-increased pricing for some PV components in 2010, annual beginning-of-year feed-in tariff cuts and depressed global demand in Q1 2011 resulted in substantial price declines. Wafer and cell prices dropped by around 15% each, while module prices fell around 7%.
Concentrating Solar Power (CSP):
The 500-MW Blythe CSP plant obtained a $2.1 billion DOE loan guarantee.
Construction is underway on the-30 MW Alamosa CPV plant, with expected completion in 2011.
There is a concentrating solar (combined CSP and CPV) pipeline of over 9 GW in the U.S.; more than 2.4 GW have signed power purchase agreements.
In total, 1,100 MW of CSP and CPV are now under construction in the U.S.
All Solar Markets:
The total value of US solar market installations grew 67 percent from $3.6 billion in 2009 to $6.0 billion in 2010.
Solar electric installations in 2010 totaled 956 megawatts (MW) to reach a cumulative installed capacity of 2.6 gigawatts (GW), enough to power more than half a million households.
Solar PV installations continue their exponential growth.
The extraordinary growth of solar makes sense. Think of sunlight as free oil. It’s all around us every day, available for collection. No need for drilling and no threat of oil spills or toxic emissions. Solar panels convert the free energy into electricity or heat. And they do it with remarkable efficiency. It takes energy to produce energy, and to my mind, one of the most important ways to measure the energy performance of something is by calculating the Energy Returned on Energy Invested (ERoEI) – which measures how much energy it takes to produce the energy. The higher the ERoEI, the better. Here’s a chart showing the ERoEI for various energy sources.
Solar and wind have the highest ERoEI of all sources of energy, and they are trending higher. Meanwhile, looking at oil, the easy oil has been extracted, what remains is increasingly expensive and difficult to get to, and toxic to extract and process. It takes much more energy to produce a barrel of oil today than it did just 50 years ago. Oil’s ERoEI has plummeted from about 100:1 in the 1950’s to about 10:1 today.
In the US Energy Information Administration’s most recent Monthly Energy Review, they show that domestic production of renewable energy has surpassed that of nuclear power.
During the first quarter of 2011, renewable energy sources (note that this includes biomass/biofuels, geothermal, solar, water, wind):
Provided 11.73 percent of U.S. energy production.
Delivered 5.65 percent more than that from nuclear power.
Energy from renewable sources is now 77.15 percent of that from domestic crude oil production.
Looking at just the electricity sector, according to the latest issue of EIA’s Electric Power Monthly, for the first quarter of 2011, renewable energy sources (biomass, geothermal, solar, water, wind) accounted for 12.94 percent of net U.S. electrical generation — up from 10.31 percent during the same period in 2010.
In terms of actual production, renewable electrical output increased by 25.82 percent in the first three months of 2011 compared to the first quarter of 2010. Solar-generated electricity increased by 104.8 percent, wind-generated electricity rose by 40.3 percent, hydropower output expanded by 28.7 percent, and geothermal electrical generation rose by 5.8 percent. Only electricity from biomass sources dropped, by 4.8 percent. By comparison, natural gas electrical output rose by 1.8 percent and nuclear-generated electricity increased by only 0.4 percent, while coal-generated electricity dropped by 5.7 percent.
The chart below is a concise view of the energy flow from various energy sources and destinations. Though it is only current through 2009, it gives a remarkable view into the complex landscape of where our energy comes from and how we use it.
Subsidies and tax breaks are a tried and true way of helping a developing industry get up on its feet.
One of the strategies to accelerate a transition to cleaner greener renewable energy sources is to subsidize research development, and production of renewable energy sources, such as wind power, solar power, geothermal, etc.
Free market advocates often say that the emerging renewable energy industry should not be subsidized. What is not widely know though, is that subsidies for well established fossil fuels exceed renewables by almost six to one.
Research by the Woodrow Wilson International Center for Scholars and the Environmental Law Institute reveals that the lion’s share of energy subsidies supported energy sources that emit high levels of greenhouse gases (GHGs). The study, which reviewed fossil fuel and energy subsidies for Fiscal Years 2002-2008, showed that the federal government spent about $70 billion on the fossil fuel industry, and about $12 billion on renewables. As the report points out:
Moreover, just a handful of tax breaks make up the largest portion of subsidies for fossil fuels, with the most significant of these, the Foreign Tax Credit, supporting the overseas production of oil. More than half of the subsidies for renewables are attributable to corn-based ethanol, the use of which, while decreasing American reliance on foreign oil, has generated concern about climate effects.These figures raise the question of whether scarce government funds might be better allocated to move the United States towards a low-carbon economy.
N.B. Carbon capture and storage is a developing technology that would allow coal-burning utilities to capture and store their carbon dioxide emissions. Although this technology does not make coal a renewable fuel, if successful it would reduce greenhouse gas emissions compared to coal plants that do not use this technology. The production and use of corn ethanol can generate significant greenhouse gas emissions. Recognizing that the production and use of corn-based ethanol may generate significant greenhouse gas emissions, the data depict renewable subsidies both with and without ethanol subsidies.
Fossil fuel extraction is increasingly toxic (e.g. fracking poisons public water systems) and environmentally destructive (e.g. gulf oil “spill”). And fossil fuel production seems to be hitting a Peak Oil wall. As production lags demand, we should expect oil and gas prices to rise precipitously. Subsidizing oil keeps us addicted to it.
Three of the top 5 biggest companies in the world are oil companies (Exxon, BP, Royal Dutch Shell). Rather than subsidize Big Oil profits and foreign oil nations, we should be taxing fossil fuels to reduce their use. Tax what we want to reduce, and subsidize what we want to increase. Tax what harms us, and subsidize what helps us. Use the taxes to fund R&D and development of a world class alternative energy industry.
Obviously, that means politicians will need to resist the monied special interests of the Big Oil lobby.
The most read article at the NY Times online yesterday was The U.S.S. Prius by Thomas Friedman. The thrust of the article centers around two brutal facts – we are fighting wars for oil, and wars consume a lot of oil. One of the tidbits mentioned toward the end of the article is that a gallon of gas costs up to $400 per gallon by the time it reaches the front lines. Moving beyond the economics, getting fuel to the front lines also costs lives. The U.S. military loses one soldier for every 24 fuel convoys it runs in Afghanistan.
Friedman observes “at a time when a fraudulent, anti-science campaign funded largely by Big Oil and Big Coal has blocked Congress from passing any clean energy/climate bill” the U.S. Navy and Marines are spearheading a strategy to make the military much more energy efficient. Friedman adds, “Unlike the Congress, which can be bought off by Big Oil and Big Coal, it is not so easy to tell the Marines that they can’t buy the solar power that could save lives.”
Ray Mabus, the Secretary of the Navy, has crafted a strategy to shift from oil to alternative energy, including, solar and biofuels. On Earth Day this year, the Navy flew a F/A-18 Super Hornet fighter jet powered by a 50-50 blend of conventional jet fuel and camelina aviation biofuel made from pressed mustard seeds.
And while congress favors boondogles like corn ethanol, which uses almost as much energy producing it as it yields:
The Navy will use only “third generation” biofuels. That means no ethanol made from corn because it doesn’t have enough energy density. The Navy is only testing fuels like camelina and algae that do not compete with food, that have a total end-to-end carbon footprint cleaner than fossil fuels and that can be grown in ways that will ultimately be cheaper than fossil fuels.
Mabus has also set a goal for the Navy to use alternative energy sources to provide 50 percent of the energy for all its war-fighting ships, planes, vehicles and shore installations by 2020.
About 60% of the oil we consume is imported from foreign nations – many of those nations are petro-dictatorships. As we shift to alternative fuels and energy, we can reduce our dependance on foreign oil.
Though many people are familiar with solar energy, innovations in the field of biofuels are less well known. Most vehicles run on liquid fossil fuels – gasoline and diesel. Biofuels, such as camelina, provide a cleaner greener alternative to fossil fuels. Camelina Sativa is a member of the mustard family, a distant relative to canola. Camelina can grow on land unsuitable for most food crops, especially arid lands. It has yields that are roughly double that of soy. Camelina can be grown in a rotation with wheat crops. Farmers who have followed a wheat-fallow pattern can switch to a wheat-camelina-wheat pattern, and produce up to 100 gallons of camelina oil per acre, while growing up to 15 percent more wheat. And once the oil is pressed from the seed, the leftover “mash” can be used as nutritious livestock feed.
We consume more oil for transportation than anything else. Innovations in transportation fuels will have the most impact on global energy consumption and associated emissions of climate-changing CO2.
Oil production is peaking and will become increasingly expensive. It’s time to support our transition to a cleaner, greener alternative energy.
The U.S. spends more money on potato chips than energy research and development. To restore US scientific and technical leadership, Congress needs to stop bashing science and taking money from Big Oil, and start investing in our energy future.
In California’s election, voter support for Prop 23 is waning. That’s good news, but the fight is not over. If you didn’t like Prop 23, you’re really not going to like Prop 26. Out of state Big Oil was backing Prop 23, and, seeing that as a lost cause, they are shifting their support to Prop 26.
Prop 26 is another Big Oil backed initiative. Prop 26 would make it more difficult for state and local government to impose mitigation fees on business activities that cause harm to the environment or public health and safety. For example, fees imposed on tobacco companies to fund health-related programs, on industries for toxic waste cleanup and on alcohol retailers for law enforcement. In other words, when companies do us harm, through increased pollution, health risk, toxic waste, and crime, Prop 26 shifts the cost of those problems to the tax payer, and away from those businesses that caused the problem.
It’s all about AB32
Prop 23 was all about gutting California’s AB32 law, which requires the state to cut emissions of carbon dioxide and other greenhouse gases 25 percent by 2020.
So what are oil companies worried about? Why are the pumping tens of millions of dollars into Prop 23 and Prop 26 initiatives?
As the chart below shows, California is on the front line in the transition to alternative fuel vehicles. The US consumes more oil for transportation, than anything else. No state is making the transition to alternative fuels faster than California.
While AB32 is bad news for out of state Big Oil, it’s good news for California’s cleantech industry and general economic and environmental health of the state. It creates new cleantech jobs and positions California to be a global leader in this emerging industry. And it’s good news for the world, which will benefit from California’s cleantech innovations, much the way it did with decades of hi-tech chip, computer and communications innovations that put Silicon Valley on the map.
From the chart below, we can see that Cleantech jobs in the California Bay Area are on a fast growth path. Silicon Valley is becoming Cleantech Valley.
As sustainable business thinker Andrew Winston recenlty said:
“One global economy, the clean one, is growing, and the global battle for the new jobs is on. Some countries – such as China, Germany, Spain, Portugal, and many others – are going after these jobs aggressively. The other part of the economy – the dead fuel economy – is not going to be a growth engine (with the important exception of natural gas, which may provide a useful, medium-term bridge to the future).”
Clean economy jobs are growing ten times faster than the statewide average. AB32 is driving that growth as we transition to a clean energy economy.
AB32 is largely funded by revenue from fees. As AB32 ramps up it will require the implementation and collection of significantly higher fees to fund the implementation and enforcement of the Air Resources Board’s (ARB) scoping plan to reduce greenhouse gas (GHG) emissions to 1990 levels by 2020. If Big Oil succeeds in passing Prop 26, they take the teeth out of AB32 and pass the cost of policing businesses to the tax payers. Voting NO on Prop 23 and Prop 26 keeps big business accountable when they do harm.
Prop 23 Support is Fading
California voters are catching on to the fact that Prop 23 was an initiative promoted and funded by out of state Big Oil companies.
Dan Morain at the Sacramento Bee writes:
Heading into the final two weeks before the Nov. 2 election, the main funders, Texas-based Valero and Tesoro oil companies, seem to have concluded it makes no sense to throw more of their oil-stained millions at the bad idea.
Yes-on-23 strategist Rick Claussen told me last week that there would be no final push unless backers came through with $10 million fast. The week came and went without an infusion.
Laura Campos, Director of Shareholder Activities at the Nathan Cummings Foundation, said that shareholders are “concerned Tesoro’s support for the highly controversial Proposition 23 could lead to a decrease in shareholder value by damaging the company’s reputation and negatively impacting the business environment in a state where Tesoro has significant operations.”
As oil company manipulation of California politics has gained public exposure, shareholders are concerned that voters will vote with their feet, and not shop at gas stations of the Prop 23 proponents.
KQED radio recently hosted a debate on Prop 26, between John Dunlap, a proponent of Prop. 26, and Lenny Goldberg, executive director of the California Tax Reform Association and an opponent of Prop. 26. A commenter on that debate summed it up nicely:
What Mr. Dunlap and the industries supporting Prop 26 are really trying to do is overturn a unanimous (7-0) California Supreme Court decision (the Sinclair case mentioned at the beginning of the show) that said fees can be charged to address public health, environmental or other social problems directly associated with the production or use of a product. These legitimate regulatory fees are not “hidden taxes” as the proponents suggest. What voters really have to decide is, was the Supreme Court correct in saying, essentially, the polluter pays for their pollution. The alternative is that the public pays through poorer health or through their tax dollar (either through higher taxes or shifting tax revenues away from other services like education and law enforcement).
As I mentioned above, AB32 fosters job growth as we transition to a cleantech economy. When Big Oil tries to gut AB32, they hurt the California economy. But more than that, by promoting Prop 26, they are thumbing their nose at the citizens of California and shunning their responsibility for their toxic industry. A paper by the California Alliance for Environmental Justice, “Toxic Twins”, provides examples of Tesoro and Valero – two major Big Oil proponents of Prop 23 – and their toxic corporate behavior in California.
For more on out of state big oil, and a comprehensive list of backers of Prop 23, see Oil Change International’s excellent interactive map for info on who is funding Prop 23.
David and Goliath
I leave you with this inspiring video of Joel Francis, a Senior at Cal State LA. Joel challenges the Goliath of Big Oil – multi-billionaire Charles Koch, of Koch Industries – to a debate. Koch is one of the major contributors to Prop 23, along with a variety of other initiatives and politicians working against a transition to a clean energy economy.
In Joel’s challenge, he says:
“Mr. Koch, I get that you and your corporation don’t want to be part of our clean energy future. That’s your free market choice. But that doesn’t mean you get to wreck its development for everyone else.”
There is an age old attempt going on, of companies indirectly trying to shape the public understanding of key issues.
Let’s make sure we all do our homework.
Time just posted a good article on European Big Oil companies funding climate skeptics, that relates to all this. It’s worth reading.
And with elections across the country in their final days, if you want to see if your representatives are receiving money from big oil, check out http://dirtyenergymoney.org/.
For more on the California’s Prop 23 initiative, see: