"The kind of technological revolution called for by energy experts typically does not occur via regulatory fiat" claim Shellenberger & Nordhaus. Actually, that is typically the only way it occurs. I defy anyone to name a country that has successfully adopted alternative fuels for vehicles without employing some kind of regulatory mandate. This is also true in the electricity sector. Consider that in terms of electricity consumption, the average Californian generates under one third the carbon dioxide emissions of the average American while paying the same annual bill. Did California accomplish this by technology breakthroughs that S&N mistakenly say we need? Not at all. They did it by accelerating the deployment of boring old technology -- insulation, efficient lightbulbs, refrigerators, and other appliances, light-colored roofs, and so on -- through tough building codes and intelligent utility regulations, especially ones that put efficiency on an equal footing with new generation. The result: From 1976 to 2005, electricity consumption per capita grew 60 percent in the rest of the nation, while it stayed flat in hi-tech, fast-growing California. S&N think we must have massive $30 billion-a-year government programs and clean technologies. One of their central arguments is that "big, long-term investments in new technologies are made only by governments." This is perhaps half true, but 100 percent irrelevant. What we need is big, long-term investment in existing technologies -- and that is made primarily by the private sector stimulated by government regulations. Why isn't government spending more important? Let me relate an eye-opening story from my time in government.
California -- already a leader in intelligent utility regulations -- is taking aggressive steps to stay the leader. The California Public Utilities Commission (PUC) made the following remarkable proposal last month: All new residential construction in California will be zero net energy by 2020 All new commercial construction in California will be zero net energy by 2030 In addition, the PUC established "a new system of incentives and penalties to drive investor-owned utilities above and beyond California's aggressive energy savings goals." Under this framework: Earnings to shareholders accrue only when a utility produces positive net benefits (savings minus costs) for ratepayers. The shareholder "reward" side of the incentive mechanism is balanced by the risk of financial penalties for substandard performance in achieving the PUC's per-kilowatt, kilowatt-hour, and therm savings goals. Kudos to the PUC for its aggressive strategy, which "puts energy efficiency on an equal footing with utility generation," as Commissioner Timothy Alan Simon put it. "It will align utility corporate culture with California's environmental values." Even though utility regulations seem mundane, they are a core climate strategy, so here are some more details of the PUC's ground-breaking decision:
Last week, the Clinton Global Initiative (CGI) announced that eight utilities "are committed to seeking regulatory reforms and approvals to increase their investment in energy efficiency by $500 million annually to about $1.5 billion annually." The utilities -- Con Edison, Duke Energy, Edison International, Great Plains Energy, Pepco Holdings, PNM Resources, Sierra Pacific Resources, and Xcel Energy -- represent nearly 20 million customers. The extra efficiency effort would "reduce carbon dioxide emissions by about 30 million tons" and "avoid the need for 50 500-megawatt peaking power plants." What regulatory reform? Our former President offered "to try to explain it to you in my basic English" which I reprint here:
The DOE's Strategic Unconventional Fuels Task Force has issued its surreal final report: Responsible development of America's oil shale, tar sands, heavy oil, coal, and oil resources amenable to recovery by carbon dioxide injection, by private industry, supported and encouraged by government actions to reduce uncertainties and stimulate investment, could supply all of the Department of Defense's domestic fuels demand by 2016, and supply upwards of 7 million barrels [a day] of domestically produced liquid fuels to domestic markets by 2035. Seriously. How does the Task Force explain how one can have "responsible development" of resources to an extent that would spell certain doom for the climate?
Do we need "disruptive clean-energy technologies that achieve non-incremental breakthroughs" to solve the global warming problem, as S&N (and Lomborg, and Bush, and his advisors) argue? Let's hope not -- for the sake of the next 50 generations. Why? Two reasons: Such breakthroughs hardly ever happen. Even when they do happen, they rarely have a transformative impact on energy markets, even over a span of decades. Consider that solar photovoltaic cells -- a major breakthrough -- were invented over 50 years ago, and still comprise only about 0.1 percent of U.S. electricity (and that amount is thanks to major subsidies). Consider that hydrogen fuel cells -- a favorite technology of the breakthrough bunch -- were invented more than 165 years ago, and deliver very little electricity (and what little they do deliver comes only because of major subsidies) and no consumer transportation. Consider fusion -- 'nuff said! I know this seems counterintuitive, when we see such remarkable technology advances almost every month in telecommunications and computers. But it's true -- and I will explain why in this post.
Philippines president Gloria Macapagal-Arroyo spoke at the opening plenary of the Clinton Global Initiative. Unintentionally, her remarks illustrated the challenge of sustainable development. First the good news -- green power: We are endowed with geothermal power and it fits very well with our Green Philippines program. We want to use clean energy, we want to have energy independence, and geothermal power gives us clean energy and energy independence. Just before coming here yesterday, I was in an island in Santro Philippines, in a geothermal field. In fact the biggest wet field of geothermal power in the world. And what we did was we presided over yesterday a turnover of a build, operate, and transfer project from the private sector to the government sector. I had a similar turn over a few weeks ago, and the private sector has been able to get, the investors have been able to get their money back before they turn it over to the national government. So it's been a well paying proposition for them, too. Now the bad news (which she thought was good news) -- subsidized power:
What do Michael Crichton, Bjorn Lomborg, Frank Luntz, George W. Bush (and his climate/energy advisors) have in common with Michael Shellenberger & Ted Nordhaus? They all believe that (1) new "breakthrough" technologies are needed to solve the global warming problem and (2) investing in such technology is far more important than regulating carbon. In fairness to President Bush -- he doesn't really believe those two things (as evidenced by the fact that he has actually cut funding for key carbon-reducing technologies), he just says them because conservative strategist Frank Luntz says it's the best way to sound like you care about global warming without doing anything about it. The "breakthrough technology" message is certainly the cleverest one the deniers and delayers have invented -- who wouldn't rather have a techno-fix than higher energy prices? That's why Lomborg endorses it so much in his book, Cool It -- but it is certainly wrong and dangerously so, as I argue at length in my book. Why two people who say they care about the environment -- Shellenberger & Nordhaus (S&N) -- embrace it, I don't understand. I won't waste time reading their new instant bestseller, unhelpfully titled Break Through, and you shouldn't either (Roger Pielke, Jr., and Gregg Easterbrook endorse it -- 'nuff said). I've read more than enough misinformation from them in their landmark essay,"The Death of Environmentalism," and recent articles in The New Republic (subs. req'd) and Gristmill (here and here). S&N simply don't know what they're talking about. Worse, their message plays right into the hands of those who counsel delay. For that reason, I will spend some time debunking them. Here is the most dangerous S&N falsehood, from TNR:
I don't know how NASA's James Hansen keeps up his pace of writing -- or how he puts up with the steady stream of disinformation launched against him. I am not trying to create a cult of personality around him, but I do feel under some obligation to give his writing as much attention as possible -- as I think he has done more than any other scientist to raise awareness on climate change, and deserves our thanks, not slander. "The latest swift-boating," Hansen explains in a new post (PDF), "is the whacko claim that I received $720,000.00 from George Soros." Here is a smear from Investors Business Daily, of all places -- I have no idea why investors would be interested in such drivel -- which migrated over to the conservative websight NewsBusters in an article titled, "Is Global Warming Alarmist James Hansen a Shill for George Soros?" Hansen explains, "Here is the real deal, with the order of things, as well as I can remember without wasting even more time digging into papers and records":
The carbon plan of Rep. John Dingell (D-Mich.) is considerably lamer -- and more transparently a poison pill -- than early reports suggested. So I strongly disagree with Chris Dodd, Friends of the Earth, and Gristmill's Charles Komanoff, who all applaud the bill. Here's why. First, as Dingell himself has said, he wanted to design a bill with maximum pain to prove to everyone how unpalatable greenhouse gas mitigation is (see below). Why else include a pointless $0.50 gasoline tax on top of the carbon tax? Dingell actually has a double agenda here -- to torpedo climate legislation and a toughening of CAFE at once. Taxes are unpopular enough -- but two of them? Come on! We've seen gasoline prices jump two dollars a gallon in recent years, with little impact on usage. What would another 50 cents do, except piss people off? It would never make the final bill, and Dingell knows it. Second, Dingell "phases out the mortgage interest on primary mortgages on houses over 3,000 square feet." But why? Here is the lame answer: