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ECONOMIST Debate on Renewable Energy (Part II: Climate Alarmism vs. the Environment)

The first of two rebuttal phases of the ECONOMIST’s online debate on renewable energy is up. My opening statement focused on energy density by resurrecting the timeless wisdom of William Stanley Jevons. My rebuttal below (against Matthias Fripp of Oxford University) expands the energy density argument to stress that environmentalists must reconsider (not assume) climate alarmism to stop the assault of government-enabled renewables on the environment.

With growing grassroot opposition against industrial wind parks, the supply-side strategy of forced energy transformation is in real trouble. Wind power is not much of a supply source, which raises the question about why anti-fossil-fuel types have not embraced nuclear power.

To play devil’s advocate, is the real strategy of anti-industrialists to purposefully restrict supply to force conservation via high prices? Is the real enemy cheap energy itself? After all, it was Paul Ehrlich who infamously said, “Giving society cheap energy at this point would be equivalent to giving an idiot child a machine gun.” (1)

(1) Paul Ehrlich, “An Ecologist’s Perspective on Nuclear Power,” Federal Academy of Science Public Issue Report, May-June 1975, p. 5.

Part II’s rebuttal by yours truly follows. Part III of our debate will follow this weekend.

“In many countries and in the EU itself climate and energy policies and programmes are already being adjusted or abandoned. This includes … reduced plans and incentives for massive offshore wind farm development, delays in investments in large-scale electricity grids and interconnections, including so-called smart grid projects, and reduced subsidies and lower feed-in tariffs for solar and wind power.”

- Andrew MacKillop, “Europe’s Green Energy Chaos,” European Energy Review, October 31, 2011.

Europe is reaching the economic and political limits of subsidizing renewable energy. Government-engineered price inflation is straining the commoners, and state budgets are in deficit. The environment is also being compromised by the infrastructure required for dilute, intermittent energy. The only clear winners are the crony capitalists, the rent-seekers, who run their business on special government favor. Remember Enron, which in the 1990s set out to become the world’s leading renewable energy company?

Despite the failed experiment in forced energy transformation, the affirmative engages in a post-modernistic narrative about how a massive scale-up of wind and solar power will magically bring affordability and reliability. But you can’t make up by volume what is lost per unit. Other alternatives, such as gas/nuclear, are worth evaluating in place of wind/solar from even a climate-alarmist perspective.

The physics of energy is controlling. The stock of the sun’s energy over many millions of years (carbon-based energy) is overwhelmingly superior to the dilute energy flows directly or indirectly generated from the sun. What W. S. Jevons surmised in the nineteenth century, the subject of my original statement, remains relevant.

A New Environmental Standard?

There is a joke making the rounds. “When is an environmentalist not an environmentalist?’ The answer: “When it comes to renewable energy.”

Why? Because substituting wind and solar for fossil fuels to any significant degree coats vast surface areas with machinery and infrastructure. The growing grassroots backlash in the United States and in the Britain against industrial wind parks (and controversy over solar parks in the western United States) is indicative that renewable energy is reaching its environmental limits, not only its fiscal limits.

In Hard Green: Saving the Environment from the Environmentalists (Basic Books, 1999), Peter Huber calls for a new environmental energy standard:

The greenest fuels are the ones that contain the most energy per pound of material that must be mined, trucked, pumped, piped, and burnt. [In contrast], extracting comparable amounts of energy from the surface would entail truly monstrous environmental disruption…. The greenest possible strategy is to mine and to bury, to fly and to tunnel, to search high and low, where the life mostly isn’t, and so to leave the edge, the space in the middle, living and green.” (pp. 105, 108)

This gets back to relative energy density. The economic advantage of oil, gas, and coal translates into a less-is-more advantage in important environmental dimensions.

Climate Alarmism Reconsidered

“Environmentalists against climate alarmism” should be a new movement given the practical problems of renewables. The intellectual arguments against climate pessimism are there.

A growing amount of observational evidence—as opposed to (problematic) model-based determination—is pointing to low-end values for the climate sensitivity to anthropogenic greenhouse gases. The rate of rise in the global average temperature (both at the surface and in the lower atmosphere) in recent decades—a time during which the anthropogenic emissions of greenhouse gases has grown by two-thirds—has consistently fallen beneath climate model projections (Santer et al., 2011). In fact, for nearly the past decade and a half, global temperatures have not risen at all (Brohan et al., 2006, and updates; Mears and Wentz, 2009, and updates).

While, much research is currently being undertaken to better understand the reasons behind this dearth of recent warming, it would seem that a higher-than-expected climate sensitivity is not among them. A low climate sensitivity can also been inferred from recent work on cloud behavior (e.g., Spencer and Braswell, 2010; Lindzen and Choi, 2011), paleoclimate studies (e.g., Chylek and Lohmann, 2008), and ocean circulation (e.g., Swanson and Tsonis, 2009), while other research erodes the possibility of a higher- than-expected climate sensitivity (e.g., Annan and Hargreaves, 2009; Frank et al., 2010; Lemoine, 2010).

While the final answer remains elusive, recent observations of the earth’s climate system suggest that we are on a pathway towards less, rather, than more, global warming—and a fading of the case for climate alarmism.

The above balance of evidence is good news for economics and the environment given the physical nature of energy in light of societal needs for material sustenance and prosperity.

7 comments

1 Manuel { 11.11.11 at 2:51 pm }

Dear Sir, I completely support your idea that markets should freely establish prices which should steer demand and capital only to the most efficient energy forms. But I have to call your attention to one huge flaw of your argument against subsidizing renewable energies. To my opinion you severely underestimate or understate government subsidies to fossil fuels and nuclear energy. Almost all negative effects of energy production from fossil fuels and even more nuclear energy have been externalized and for years are being paid by taxpayers all around the world (just summarize all kinds of health costs in industrial areas with air pollution without even starting with the effects of global warming – which by the way is aknowledged by thousands of scients and citing a handful of articles stating the opposite wont change that. Nuclear energy is even heavier subsidized (insurrance of power plants, transport and storage of nuclear waste, recovery of polluted areas,… – just look at Fukushima), so the so-called free-market price today is not at all established on competitive grounds. If we are discussing the (just more transparent because direct) subsidies of renewable energies, than we are talking about leveling the grounds for renewables, not distorting “free-market prices”.

2 rbradley { 11.11.11 at 9:06 pm }

Manuel:

Nuclear is all about government subsidies, yes.

Fossil fuels have received special tax treatment, particularly between the 1920s and the early 1970s, At the same time, government intervention has penalized much of the industry in different ways (such as price controls on crude oil and oil products from 1973-81 and natural gas dedicated in interstate commerce between the 1950s and until the1980s).

On a per unit basis, subsidies for wind and solar are pretty outrageous–that is the real problem. These industries live off subsidies; oil, gas, and coal live well with or without subsidies.

3 Manuel { 11.11.11 at 10:48 pm }

Thank you for your answer.

Let me just add some short points:

1. Health costs: Wouldn’t you consider it a subsidy if taxpayers pay for all extra health costs caused by polluted air? Just go for a nice run through the woods and the stop by a street with heavy traffic, you can smell the air pollution. This happens in many cities and regions where fossil fuels are burnt for energy production.

2. Filter cake: Even if you install filters, the filter cake then has to be stored as hazardous waste like nuclear waste. This again is not paid for by the energy producers but by the taxpayers.

3. Global warming: Let’s asssume for one moment that the hundreds of studies written on global warming are accurate and some of the natural disasters caused by man made (or at least man boosted) global warming. Even if the probability would be low that these events actually are caused by human actions, considering the potential damage, the expected value for those actions would be highly negative. If you internalize all these effects through full-cost accounting (CO2-certificates only reflect the “true” value of CO2 if producers actually pay for all the effects and not just a fictious market price), energy from fossil fuels would be way more expensive.

4. Future generations: Even if all my prior arguments seem irrelevant to you for some cause, let me just ak you this: why is your generation entitled to use up all the earths non-renewable fossile fuels?

5. Subsidies for renewables: Renewables only need subsidies to support the set-up costs for the construction of plants. Operating costs already lie below the – heavily distorted by government subsidies – prices for other energy forms: http://thinkprogress.org/romm/2011/11/07/362705/krugman-solar-power/

4 rbradley { 11.13.11 at 9:05 am }

Manuel:

Lots of points here, and we have posts coming up that deal with some of the issues you raise.

Briefly…

1) pollution statistics are trending quite positively, and the benefits of dense energy has helped health and living in so many ways. We must look at both sides of the equation, right?

2) I need to know more about this. Is human ingenuity not up to this disposal problem, which would seem to be a cost of doing business?

3) My argument is contained in my book Climate Alarmism Reconsidered (online here) and is part of my next post at THE ECONOMIST (Tuesday night their time; Wednesday at MasterResource).

4) The next generation will be using fossil fuels and maybe the generation after that. If renewables are really cost effective as you say in #5, why worry about it for then?

5) Joe Romm–why doesn’t he allow critical comments and debate like we do here in comments? Does that make you suspicious? (And on Krugman and solar, see Robert Bryce here.)

5 Kent Hawkins { 11.13.11 at 11:15 am }

Manuel:

You are also missing the point that when volatile and intermittent new renewables run (wind and solar in particular) they must be shadowed by other generation means, usually fossil fuel plants. These plants thus operate sufficiently less efficiently than they would if they were alone carrying the wind plus their residual amount of the load. The emissions impact of that should be added to the wind/solar account if you want to go that route, so this consideration is not relevant to the discussion. Any reasonable analysis of this will show that there are little or no emissions savings and wind should pay the penalty. There is lots on this site addressing this.

Think in terms of driving on the highway and alternatively pumping the brake and gas pedals. Imagine what this does to your fuel consumption (and associated emissions), not to mention wear and tear on your engine. Don’t come back with hydro (there is not enough) and storage (a non-starter for decades).

This is actually a quite complex situation not allowing simple analysis as many wind proponents resort to.

6 Manuel { 11.14.11 at 6:44 pm }

Kent

I’m not saying we should get rid of all fossil power plants right away. I’m supporting the thought of letting current capacities installed until they can be replaced by other technologies (so if replacing coal for gas saves emissions, I’m fine with it). Power plants fueled by gas are very likely to be used for many years to come to balance any power imbalances created from renewable energy use.

I also share your current hesitance concerning energy storage, but if you look at the actual rate of innovation and efficiency gains in renewables and storage technologies, I doubt that the technologies will depend on fossil fuels for more than another decade or two (see e.g. http://web.mit.edu).
Just look at how much has been achieved in renewables research with comparably little money – compared to billions of dollars of government money which has been wasted all around the world on nuclear and which has also been used in an attempt to make non-renewable energies more sustainable – an oxymoron. I am very positive, that we should set research incentives for renewables, not for non-renewable energy forms. And then we wouldn’t have to pour in more and more money to fix all the negative externalities by these energy forms as we do today with non-renewables.

In the US, energy efficiency alone is going to be an easy and quick gain. Just to bring US-households (houses, cars, domestic appliances) down to the level of energy efficiency comparable with any technologically developed country in europe (Germany, Switzerland,…) would save a huge percentage of the country’s energy consumption.

About the smart grids, I just wanna say: The energy grid in the US is outdated anyways, so the investments will have to be made. I don’t know the circumstances well enough to talk about feasability, but I would like to see some serious studies done before the decision on the country’s technological future is being made.

Bob

Thanks again for your answer.
1) what pollution statistics are trending quite positively? CFC? I don’t know what you are talking about and I would really like to see any side to the equation there is

2) I’m really surprised you’re not informed about the full-cycle of the energy forms you are so heavily promoting. CCW is stored like nuclear waste and operated under the influence of many hardly predictable variables. These costs should form part of our economic equation (see e.g. http://www.fas.org/sgp/crs/misc/R40544.pdf).

4) and if they are not – as you say – why not worry about them?
I think that there might be other or more efficient uses for fossil fuels one day so I don’t see why your generation should waste it all just because using other technologies seemed unconvenient at first (and was heavily lobbied against by a small group of people).

I wonder why such an innovative country like the US can be so uninspired and unambitious when it comes to new forms of energy.

7 ECONOMIST Debate on Renewable Energy (Part II: Climate … » greennewstweets.com { 12.05.11 at 12:02 am }

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