Bill Gates’ recent entry into the discussion about climate action and technology is welcome. Not only is Gates a very smart guy and one of the world’s leading philanthropists, but he also has at least the reputation of knowing what he is talking about when it comes to technology and innovation.

That being said, his opening moves in this discussion — his speech at the TED conference and a post on his blog — are not beyond criticism. Though by no means his intention, Gates is encouraging a peculiar type of 21st century passivity by government officials, investors, and activists that has a high probability of leading to climate inaction. The “more innovation” meme repeated by Gates has limits that need to be acknowledged.

Gates’ TED speech beautifully outlines the challenge facing us, but I believe it falls down when it comes to solutions and their timing. He seems to feel that energy technology will follow a different, “miraculous” path to commercial acceptance than almost every other new technology.

For Gates, the big deal is reducing the carbon intensity of energy to zero, and he seems to underestimate the value of energy efficiency, as David Roberts points out in these pages. In his TED talk, Gates quickly ran by wind, solar PV, and solar thermal electric, all renewable sources, citing the cost of energy storage and ancillary services. Gates is placing his bets with his friend and former employee/partner Nathan Myhrvold, who is trying to build a type of fast breeder nuclear reactor called a traveling-wave reactor (TWR). Gates is an investor in Intellectual Ventures and TerraPower, the developer of the TWR. Fast breeder reactors could theoretically run on the much more plentiful isotope of Uranium-238 as well as other heavy elements, including nuclear waste. Additionally they are supposed to be able to produce a nuclear waste of lower toxicity and shorter half-life. However, scientists, governments, and plant developers have been attempting to build and commercialize fast breeder reactors for more than 50 years and most estimates place their commercialization into the hazy and often receding 10-to-20-year timeframe.

The largest portion of Gates’ TED talk was devoted to the TWR even though he acknowledged in the question-and-answer period that it was not a foregone conclusion that the reactor could be commercialized within the 20-year period that he allotted for the invention of new energy technologies. For what it’s worth, I support efforts to build a cleaner reactor technology, especially one that could actually, rather than theoretically, clean up the nuclear waste that we have created.

Gates is free to support whatever technology he likes, but in his role as a philanthropist he has gained the reputation of being someone who tries to represent the best interests of humanity, not simply the parochial interests of post-software venture capital. Gates seems to believe that the still non-existent TWR technology will 20 years from now meet the “cheap” criteria that will be universally acceptable. He brands renewable energy as necessarily and always “not cheap” or not cheap enough.

Strangely, he overlooks or strategically omits how most technologies get cheaper in the first place: they enter the cost curve through deployment, they achieve economies of scale, new efficiencies are discovered, and the basis for further innovations is created. How did the internet, the microchip, and the cell phone get cheap? They were deployed either via government procurement or through early commercialization at higher prices to reward and incentivize innovation. In fact, Gates seems to have some kind of awareness of this when he is not hoping for miracles. As Joseph Romm points out in a recent post on this subject, Gates in a speech a couple years ago talked about how his software business benefited from the installed base of ever-faster personal computers.

Gates and others from the software world or its periphery seem to believe that in the field of clean energy, it will all be different: innovation and cheap will come simultaneously, perhaps through acts of brilliance by their friends or companies in which they hold shares. Maybe selling bits and bytes has given these leading technorati a false impression of how physical products like electric generators are manufactured and made more economical.

Miraculous or magical future “cheap” is stealing attention and consequently funding from technologies that could enter or continue down the cost curve now. Right now in the U.S., if we were not as fixated on paying always and only the lowest price for power today and distracted by the hope of technological “maybes” of the future, we could start pretty much tomorrow replacing the output of the dirtiest baseload coal power plants on a one-for-one basis for 20 cents per kilowatt-hour for the first generation of concentrating solar thermal power plants with 16 hours thermal energy storage. Based on estimates, within a decade this price would be 10 cents/kWh, if we were to enter the cost curve in the first place and not continue dreaming and dithering. No technological miracles are required.

Both of these wholesale power rates are more than existing, paid-for coal baseload generators receive (3 to 5 cents/kWh), but what is the cost of the Holocene climate that has been so good to us and our ancestors? If we also are pushing for green jobs and green economic stimulus, we are going to have to pay something via electric rates and/or taxes to make it happen. It can’t all be cheap.

Yet, why do we turn up our noses at the sure thing, that additionally has economic benefits at a time of need, and turn to the innovation casino in the name of a spectral, maybe-someday “cheap”?

I would suggest, in agreement with Gates and other innovation fans, that we spend the $10 billion per year on energy research, but more importantly, spend $100 billion or more on deploying existing technologies that cut emissions assuredly now or within a predictable timeframe. What do you do in the face of fast-approaching tipping points?

While they have generally good intentions, Gates, Myhrvold, the Breakthrough Institute crowd (as represented by Teryn Norris in these pages), and the Google guys are reinforcing a largely American tradition where innovation and technological optimism put off hard choices. “Invest in innovation and just wait for us to deliver the future to you,” they say. “You can’t have too much innovation.” The hope of “cheap and clean” contains the promise of instant gratification and an easy path to worldwide sustainable development.

Unfortunately this type of promise, issued by technologists, has the effect of freezing us in our chairs behind our computer screens as future consumers of technological brilliance. Furthermore and perhaps more devastatingly, it has the effect of freezing policymakers and our leaders into living in the eternal “maybe.” “Maybe tomorrow,” they think, “technology and innovation will release me from the hard choices I have to make today.”

Less fantastic and more real is to start building the zero-carbon future today, which may have the unpleasant effect for some of rupturing the bubble of miracles or utopian dreams. The hope for easy virtue distracts us from the push to put clean energy generators online when they are needed at a price that we as a society can easily afford.

As a nation, we have become unable to pay ourselves living wages to do the work required at home to keep standards of living in our country within reach of other advanced industrialized countries — nations that have not taken such a radical path towards deindustrialization and consuming beyond their means. Our specialization as over-consumers has started to shut our own people out of the ability to earn enough through their work to buy what they need to live and thrive; the more goods and services we feel compelled to buy, the less we can afford to pay for each good or service, barring a substantial growth in our individual or median national income.

Building a new infrastructure involves years if not decades of work and the construction and manufacture of large physical structures here domestically, all of which cost money. We will need to organize a way to pay for this infrastructure either through payments for services, like electrical rates, or through tax revenue.

To transform our energy infrastructure we need to create policies and economic drivers for change that will provide a steadier stream of revenue to fund this monumental project than the occasional windfall or magnanimous gesture. We will need to "pay the piper" rather than simply "pass the buck."

Opponents of this line of thinking will put forward the notion that monies collected through taxes or regulated pricing will inevitably be wasted, as they have not been distributed through a process of free exchange between independent consumers choosing alternatives in a marketplace setting.

We would lose years of time and much money creating a perfect market economy for infrastructure services, a novelty within world history. Already we have seen experiments with deregulation in various electric systems, i.e. California, but with little positive learned about the nature of these goods and services and their most efficient means of delivery.

Instead, we need to face the music and start reckoning that we must spend more on necessary clean energy infrastructure to ensure that we have a tolerable or even pleasant way of life as oil depletes and carbon concentrations rise. Spending more, whether through electric rates or taxes, means paying one’s neighbors and friends wages that they can live with to do the work that needs to be done to keep our United States at or near the lead of the next industrial revolution.

Those who want a new clean energy infrastructure yet stubbornly insist on paying only the cheapest price are for all practical purposes or waiting for a rich charitable patron or technological windfall to “make it all better." Technological optimists, spoiled by the microelectronics and Internet revolutions, hold out for the ultimate cheap generation and storage solutions that will match our current price expectations. We can hope this will happen, but we cannot bank on hope alone. “Free” market enthusiasts look around for the next better deal or ways to push pricing down to current price expectations against what looks likely to be a permanent bull market (with ever-rising prices) for commodities — the commodities of which energy and transport infrastructure are made. The reality of the world, however, does not always conform to one’s preferred social or economic ideal.

If we look around, though, we will see that we together can be our own patrons; we as a culture can place a higher value on energy and our own livelihoods, as workers and investors in our own society. We can pay somewhat more for something that we have taken for granted but that now requires our attention and sustained effort.

Renewable Energy Payments

A more transparent approach to spurring the market for renewable energy technologies are Renewable Energy Payments, a.k.a. feed-in tariffs. REPs name and guarantee a feasible price for renewable power from supported technologies under a variety of conditions related to the size and siting of the generator. A successful REP system supports a variety of technologies and prices electricity to allow plant developers to recover their investment plus a reasonable profit. Another way to put it is that an REP system constitutes an open-ended power purchase agreement for 10 or 20 years that allows plant builders to receive financing at favorable rates because of the investment’s security, due to the guaranteed wholesale power price.

The Spanish REP program for solar thermal power allowed the European solar thermal electric industry to leapfrog the American industry. Despite a lower power solar resource in Spain, the first commercial solar thermal plant with storage in the world — the Andasol 1 plant — is scheduled to go on-line in Andalucia later this year.

In successive generations of plants, some REP systems are designed to reduce the level of the tariff to encourage the industry to become more efficient. Some REP systems have a built in inflation factor to adjust the level of the initial tariff to reflect changes in the value of money. REPs are typically paid for via a supplemental charge attached to all power sales in the electricity system, pooled among the widest set of power users.

REP systems have been successfully applied in Germany and Spain and have recently been introduced in Ontario, France, and Italy. Since the inauguration of their current REP system in 2000, the Germans, for instance, have more than doubled the fraction of electricity attributable to renewable energy from 7 percent to over 14 percent. Estimates are that German power users will pay on average a maximum of 2.80 euros ($4.11) per account per month in 2015 when the effect of their REP law will be at its projected maximum, so the REP tariffs do not contribute much to overall power costs to consumers. If it were considered more politically acceptable to pay for the surplus power payments attributable to the REP tariffs in part through tax revenues rather than through electric rates, such a system could be designed.

An REP system starts out at “cost plus reasonable profit,” but to counteract inefficiency in the renewable energy industry needs to “degress” the tariff levels for successive generations of plants or introduce market elements into pricing. The German tariff steps down in successive new generations of plants and recently the solar rooftop tariff was reduced a higher-than-usual 9 percent for 2009 installations while there was higher allowance made for offshore wind to encourage that industry; both moves generated their share of controversy, which is almost inevitable in such an environment. In Spain, in addition to a premium for clean energy there is a market option which encourages renewable generators to heed the needs of the electricity market through demand-based incentives.

Direct government investment

Though less likely to be applied in the U.S. in the current political climate — where the levying and spending of tax monies is considered to be an imposition rather than payment for public services — the federal government itself can, as was the case with the Hoover and Bonneville dams, commission renewable generators in situations where risk or payback is too uncertain for private companies.

An effective REP law, however, might make government’s involvement in direct power generation limited to the development of research reactors or in commissioning renewable generators for use by government facilities. A commitment to run government installations largely or entirely on renewable energy could provide a test bed for an all-renewable grid for the broader society.

Though potentially rife with inefficiencies, issuing bonds may be one method for governments to finance new infrastructure. While government bonds are the equivalent of a credit card for the government, the total financed portion of the new infrastructure is stated in the bond. Bond issue may be a necessary evil in building key pieces of infrastructure that are not amenable to a performance-based standard like an REP.

Rebates

Small renewable generators, largely rooftop solar PV arrays, can also receive a rebate directly from a power company or state agency based on a formula that reduces the upfront cost to buyers of purchasing and installing this equipment. These incentives require the ready availability of funds either from government coffers or from the utility company itself and would present cash flow problems for these entities if applied to larger generators, as large rebate payments would need to be paid in very large chunks to co-finance the new power plants.

Building a national grid

As is currently the case with the building of long-distance transmission, the federal government will need to take a leading role in building new transmission lines to connect load centers with areas which are most favorable for renewable energy development. The main renewable energy areas that require new transmission are: the Great Plains, the intermontane regions of the Rocky Mountains, offshore on the Great Lakes and Pacific and Atlantic Coasts for wind development; desert and semi-arid areas of the West and Southwest for solar thermal and large-scale concentrating solar PV; geothermal wells and centers of electric demand.

Large states with substantial renewable resources, California and Texas have started planning for zones where transmission lines can be built as renewable generators are built in that zone. As transmission can take many years to build, these lines will bring renewable energy to market as soon as work on generators are commissioned and ready to generate electricity.

Next: Conclusion! Paying the piper.

One of the ways the gap between market price and feasible price of renewable energy plants has been bridged is through tax benefits to investors. Just as the oil and gas industries have enjoyed various tax benefits to encourage investment in drilling, exploration, and production facilities, in the last couple decades investors in renewable generators have enjoyed either production or investment tax credits that contribute about 3 cents to the value of a kilowatt hour of renewably generated electricity for the producer. While these subsidies are set to expire at the end of 2008, most plans for new installations of renewable energy generators are contingent upon their renewal.

Tax credit policies have three drawbacks that make them politically vulnerable: they are largely invisible to the public, they are dependent upon the state of the federal budget and Washington politics, and they apply mostly to large corporate entities rather than small investors. A tax credit is paid via drawing tax revenues from other taxpayers and budgets, not necessarily from tax revenues from other parts of the energy sector. These credits have also been terminated a number of times over their checkered history, putting the renewable energy industry on a roller coaster. Finally, they are most attractive to large corporate investment vehicles and do not represent an incentive for small and medium investors to get into the renewable energy game.

Tax credits may have a role in promoting reinvestment in existing infrastructure, for instance by incentivizing the large railway companies to electrify their rights of way, as suggested by Alan Drake.

Renewable energy credits or green tags

Another method for trying to bridge the gap is selling a green power attribute separately from the power itself as a “green tag.” Also called “Green Power Marketing,” the idea is that companies and organizations can buy these tags to green their power mix, even though they are actually using the mix of power available in their area at their facilities. This is the closest one can get to a “free” market in renewable energy (credits) and those who are enamored of unregulated market mechanisms favor this type of approach.

Studies have found that REC schemes only have a mild stimulative effect and are a relatively expensive means of promoting renewable energy; there are suggestions that the traders of these credits are the prime beneficiaries of an REC system. Furthermore, RECs stimulate mostly large onshore wind farms as green power marketers are only looking for a “green” attribute at the lowest cost; to build the renewable electron economy, we will need a more diverse set of renewable generators.

Net metering

For small renewable generators that operate on the premises of a power consumer, power companies allow the customer to “run their meter backwards,” crediting the customer for the full retail cost of the electricity they generate on premises. While this may appear to be simple and fair compensation to the customer/owners of the generator, the (hidden) subsidy for net metering comes from other power users who compensate the power utility for lost profits from the sale of electricity to those self-generating customers. Another limitation of net metering is the loss of revenue for over-sizing the on-site generator and overproducing clean electricity above and beyond usage on-site.

Next: transparent renewable energy promotion policies.

Power plants, inclusive of larger renewable energy installations, are on the smaller end of “infrastructure” but are still too massive to build “on spec.” Infrastructure, then, can only get built by large economic actors like governments or corporations opening a bidding process by which manufacturers and construction companies attempt to earn the multi-year contract to build that infrastructure.

Tolls are an ancient, efficient, but often unpopular means of paying for infrastructure. Toll revenue is usually used for purposes beyond road or bridge maintenance, which can breed resentment among motorists.

There is however, abiding interest from both the buyer and the public in the quality and durability of infrastructure, which by its nature is supposed to last anywhere from 10 to 50 years. So a bidding process is not simply looking at the lowest total price, but at the quality of components through an engineering analysis. A formula, “cost plus reasonable profit,” is used to determine whether the bid is realistic and will produce the desired result.

Additionally, in such a long process there is also an interest in the continuing financial viability of the firm selected — if it went bankrupt in the middle of construction, it would further complicate the process. The “low-balling” of bids is then less attractive than it is in a pure market setting. While there are disadvantages to this formula, it provides a nascent or vital industry with security that pure market pricing does not.

Most of the electrical infrastructure we currently have was built several decades ago by the utilities, usually large private companies, under government regulation — or built directly by the federal government itself. Winning the contracts to build this infrastructure has involved a combination of appropriate technology and price considerations. Consulting engineering firms and government regulators try to keep bids from being padded too much, while insuring that quality standards are not endangered and that the bidding firm will remain viable.

This type of cooperation between buyer and seller is not the norm in the ideal “free” market. However, ideal free markets have rarely been involved in building the unique structures that make up most public infrastructure, nor do we have a plausible model for a free, unregulated market to do so in the future.

The cost of power is partly derived from the costs of building energy infrastructure plus a reasonable regulated profit; historically, the pricing for infrastructure and the resultant power has been arrived at through negotiations between public utilities regulators and power companies. With the vogue for markets extending to all aspects of economic life, legislators have attempted to introduce, post hoc, market competition to reduce the price of power — but these efforts have had mixed, at times disastrous, financial consequences for utilities. While in some places it has reduced the cost of power to consumers for at least a period of time, the costs of building and maintaining infrastructure have not been fully accounted for in the rush to impose market structures on the electricity system.

The continuing push toward deregulation, which still has ideological momentum despite bitter experiences in California at the beginning of the decade, does not promote the building of new infrastructure, let alone a new, reliable replacement clean-power infrastructure. Furthermore, there are few mechanisms in the current market that would accelerate the retirement of existing fossil plants for new clean energy power plants.

While neither “cost plus reasonable profit” nor unregulated market pricing is an ideal, universal pricing mechanism, there is little in this world that is ideal and universal, especially in the hotly contested area of how to pay for vital commodities and infrastructure.

Next: promoting clean energy through policy.

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Much renewable energy policy has incentivized the building of renewables as a virtuous “side salad” for a basically functional, but dirty electric generation system — our main energy “meal." In fact, energy industry insiders including Dick Cheney have misrecognized renewable energy, the first power source for the first electric grid, as simply an ineffectual display of personal virtue. Despite the current administration’s lamentable record of moving America toward our energy future, somewhat more forward-looking, state-level policies have actually tended to reinforce the view of renewable energy as a personal statement or an act of corporate social responsibility for utilities or their large-scale customers. These state-level policies have often focused on rooftop photovoltaics or delivering a small fraction of wholesale energy through renewable generators, the Renewable Portfolio Standard policies or RPS.

While these often token policies have helped keep the renewable energy industry on life support, policies like the RPS will not by themselves drive the building of a largely renewable or all-renewable grid. In an era where we are now targeting closing down fossil generators and replacing them with renewable generators, policy instruments will have to change as the focus switches to building an integrated Renewable Electron Economy.

In May 2008, after the Indonesian government cut fuel subsidies, raising the price of gas by 30 percent, rioting and protests broke out in the streets.

Recent political maneuvering around offshore (and Alaskan) drilling has highlighted the continuing strength of what I have called “the Cheap Energy Contract,” a social contract — particularly strong in North America — in which energy costs are supposed to contribute only negligibly to family and corporate budgets. A politician who does not throw themselves full-force into rhetoric or actions designed to depress the current price of energy at the pump or electric meter risks the ire of voters whose focus has narrowed to present-day pocketbook issues.

More than just being addicted to oil, Americans are addicted to cheap energy. Cheap energy today is supposed to be a cornerstone of our democracy, even though maintaining its low cost is extremely costly for the environment and for the future price of energy; the focus on low energy costs keeps us hostage to exhaustible and polluting fossil sources. We are seeing versions of the Cheap Energy Contract emerge in the developing world (India, Indonesia, and China) in the form of oil subsidies, which are becoming increasingly difficult for these governments to afford as the price of oil continues to climb.

On the evening before the Indonesian fuel subsidies were lifted, motorists waited to fill up at the lower, subsidized price for the last time.

Artificially cheap energy keeps energy alternatives out of the market until there are major supply disruptions or a continuing pattern of punitively sharp price spikes in existing dominant energy supplies; worldwide, 85 percent of supplied energy originates from fossil sources, mostly coal, natural gas, and petroleum. Electricity from renewable generators is still in most cases too expensive for those who adhere to the dictates of the Cheap Energy Contract, and is therefore dismissed by commentators who insist on a price for clean energy that matches that of current dirtier energy supplies. RPS laws, for instance, usually mandate that utilities bring the requisite percentage of renewable generators online at “least cost” without regard for power quality and therefore the ultimate usefulness of the renewable generator.

Even advocates of clean energy are swept up in the vortex of assumptions surrounding the Cheap Energy Contract. For instance, climate and energy analyst Joe Romm, with whom I agree on many points, often criticizes nuclear, fossil, or other energy sources he opposes by using their (high) cost as a decisive argument against their continued use or future deployment. When he does this, in my opinion, he reinforces a framework that emphasizes cheap energy now, an argument that easily can blow back in his face if he argues for most renewable energy sources to be deployed today at their current price levels.

Next: how expensive are renewables anyway?

There are sound physical reasons why the three main contenders for the energy supply for transport turn out to be the three electron economies: renewables, nuclear, and coal CCS. We have determined there that electric drive vehicles either attached to the grid or powered by some version of a battery can do most of the on-land transport tasks now dependent on oil supplies. There are other reasons why electricity is valuable for driving stationary machinery as well, which we will go into later.

Why then is electricity preferable to biofuels, hydrogen, and coal-to-liquids? In addition to zero emissions at end use, electricity has benefits in efficiency and availability in almost all stages of its production, transmission, and consumption. Electric generators can be built to use a wide variety of types of energy (heat, light, mechanical energy) to create the highly usable and flexible energy carrier, electric current. In other words, electricity is the ultimate in “flex-fuel.” All renewable energies (wind, sun, geothermal heat, wave, tidal, biomass, natural chemical, and thermal gradients ) can be converted into electricity with existing technologies. In addition, while we must shift the way we generate electricity in most instances, this is not a full-scale rebuilding of our energy system, but a modification of existing infrastructure — so in the end, less expensive.

Existing electrical generation technologies convert a fairly large amount of the primary energy they receive into electric energy. Current solar panels, for instance, can convert anywhere from 10 percent to 40 percent of the energy of the sun into electricity, depending on the technology; by contrast, plants convert at most 1 percent of the energy of the sun into biomass, an energy harvest that is further reduced if that biomass is converted into a liquid biofuel rather than burned in a biomass electric generation facility.

Electric motors are so compact that this electric sports car, has a 120kw (163 horsepower) electric motor in each of the hubs of its wheels, each of which weighs 55 lbs; an equivalent internal combustion engine would be several times larger and heavier as well as much more inefficient.

Additionally, electric motors, because of the physics of the electromagnetic force, are incredibly efficient at generating torque, the useful product of engines and motors. An electric motor of medium or larger size (90-95 percent efficient) requires somewhere between one-third and one-quarter the amount of energy to do the same work as an internal combustion engine (20-30 percent efficient). They therefore generate 3 to 4 times more torque per unit energy input than all but the largest and most efficient house-sized diesel ship engines (50 percent efficient).

Electricity can also be used for a huge variety of functions for the end user: generating mechanical movement, heat, light, and sound. So electricity is both flex-fuel and flex-use. It is no wonder that, even with no consideration of current energy and climate concerns, more and more devices have been designed with more electronic components to increase their functionality, including petroleum powered automobiles (electronic fuel injection, stability control, drive by wire, etc.).

Electricity’s weakness has been that electrical energy storage is bulky and heavy in comparison to the portable liquid fuels to which it is often compared. Batteries and ultracapacitors are still relatively large and expensive compared to a liquid fuel tank and the hydrocarbons that are pumped into it. As the drawbacks of fossil fuels are starting to be more widely recognized, the positive attributes of alternatives are once again being recognized. Also, substantial investment is once again flowing into resolving this one final hitch in electricity’s otherwise near-ideal attributes — and the technological development curve promises rapid advances.

In the distant future, we may have other energy carriers with more favorable characteristics, but for the foreseeable future it makes the most sense to build on the advantages of electricity.

Next up: the best way to generate electricity.

Promoting battery and plug-in hybrid electric vehicles

Governments can play a key role in promoting electric vehicles by buying electric vehicles en masse and helping develop battery electric and plug-in hybrid electric fleets and fleet systems. With current technology, battery electric trucks could already function as postal delivery trucks. Beyond the gasoline hybrid, government service vehicles should be mandated to be electric or PHEV/EREVs with few exceptions. As is proposed in a recent bill in Congress, government can offer tax incentives or rebates to individuals and corporations for buying individual or fleets of electric vehicles. Government can also provide the test bed for developing quick-charge and battery swap systems, especially with fleet vehicles.

Public trickle charge locations at 110/220 volts, quick-charge stations at 480 volts and battery exchange infrastructure are other areas where local, state and national policy can make a difference. The standardization of public charge plugs, for instance, will allow electric vehicle manufacturers to make vehicles with a higher value to the end consumer, by allowing any vehicle to charge at any public charging station. Government and industry may also need to standardize the battery pack-to-vehicle interface to allow interoperability between more battery packs and more electric vehicles with battery pack exchange capability. Low-interest loans may also enable electric utilities and property owners to install an electric account-linked or pay-per-charge vehicle charging infrastructure of the near future in multifamily dwellings and paid parking structures.

Aviation, marine, and special use fuels

The energy density (the energy content to weight ratio) and energy storage capacity of liquid hydrocarbons will remain for the foreseeable future vital for ships, aviation, remote environments, and applications where the substantial heat byproduct of an internal combustion engine is desirable. In these contexts, petroleum products will continue to be dominant until we have developed ways to produce bio- or synthetic fuels that do not substantially interrupt food supplies, exhaust water supplies, or endanger the fertility of soils. Luckily, our use of petroleum as a transport fuel is driven five to one by on-land use, so we will reduce our petroleum demand and our greenhouse gas emissions by transitioning to the Renewable Electron Economy as rapidly as possible.

Concentrated and smarter settlement patterns

“Peak Oilers” predict with steep rises in oil prices that suburbia will depopulate and collapse.

When those who have long predicted a rapid escalation in oil prices with severe social and economic effects turn to advocating solutions, they suggest that ultimately a post-oil society will have a stronger community focus than the anomie of suburban and widely dispersed rural settlements. James Howard Kunstler, who envisions the collapse of suburbia after a catastrophic rise in oil prices, advocates for what might be called a new urbanism or smart growth, where people live in more tightly concentrated but humanely designed cities and towns.

There is however a contradictory current within the same group, which suggests that people will need to become more self-reliant, growing their own food, preparing to become more self-sufficient autonomous units that do not require petroleum-based transportation to live. Such a current would suggest that people would use land in a more distributed manner, allowing for larger garden plots around living spaces perhaps leading to an new survivalist agrarianism.

The two contrasting scenarios proposed are based on two different notions of what is ultimately a more resource and energy efficient way to live: More concentrated settlement is built around more efficient consumption while somewhat more distributed settlement suggests that production and consumption should co-exist in the same space. It is unknown the degree to which one or the other of these visions will predominate in the near and medium-term futures.

The tripartite approach to electrifying transport concentrates some transport tasks along main electrified rights of way while leaving open the degree to which people and the machines they operate can range off of the grid using batteries or liquid fuels. Demand for transport and goods traffic along these main corridors will remain high even in times of crisis or in a theoretically more dispersed population of part-time farmers. Neither more efficient consumption nor a commingling of consumption and production is necessarily favored. I have explored in one installment of my series on the Renewable Electron Economy the possibility for farmers to use electricity to do many farming tasks that are now petroleum dependent.

In any case, it is premature to predict massive internal migrations and collapse of whole economies as oil prices continue to climb, especially if these three paths towards electrifying land transportation are pursued aggressively and effectively by government and industry in the next few years. Additionally short-term measures to increase the efficiency of our transport system as outlined above can be implemented rapidly by a combination of public agencies and private companies that recognize opportunities to provide people with more effective and more efficient transport choices even in an era of more expensive energy.

The Five Transport Energy Solutions and One Imperative

There are five fundamental options to move into a post-oil, post-natural gas energy world and one imperative:

• Imperative A: End-use energy efficiency and conservation. We will have to invest less in new energy supply if we get more from the energy we use (efficiency) as well as act and plan in a way that recognizes the limited nature of natural resources (conservation). The electron economy scenarios have the greatest potential for end-use energy efficiency. The short-term measures above will also increase efficiency.

1. The Renewable Electron Economy: electric vehicles, stationary devices, and new electric transport infrastructure powered by electric generators using renewable energy and the associated energy storage challenge.
2. The Nuclear Electron Economy: electric vehicles, stationary devices, and new electric transport infrastructure powered by electric generators using nuclear energy (with or without fuel reprocessing), with associated security risks, waste and dependence upon fissionable fuel supply.
3. The Coal CCS Electron Economy: electric vehicles, devices and new electric transport infrastructure powered by electric generators using coal with carbon capture and sequestration, a technological "maybe" dependent upon coal supply.
4. The Coal to Liquid (CTL) Transport Economy: converting coal to liquids (sometimes via the Fischer-Tropsch process), burned in internal combustion engines leading to climate disaster and resource exhaustion.
5. The Biofuel Transport Economy: Aggressive expansion of unregulated biofuel production for land transport will almost certainly lead to ecological and social disaster. Biofuels, sustainably produced, especially from wastes, will have a niche in aviation and marine propulsion.

Sub-option for Solutions 1, 2 and 3: The Hydrogen Economy is parasitic on the Electron Economies, reducing net usable energy by two-thirds for the purpose of having a compact liquid/gaseous fuel extracted by energy-consuming electrolysis. A Hydrogen Economy therefore requires a 2 to 3 fold increase in the amount of and therefore the capital investment in the required clean electric infrastructure to support renewably produced hydrogen. (There are currently even more expensive renewable ways to extract hydrogen from water using very high concentrations of sunlight that do not use electricity as an intermediary).

Any of these five transport energy supply solutions will be made much more feasible if aggressive end-use efficiency measures are pursued in parallel; therefore the imperative of energy efficiency.

Narrowing the Field

To simplify matters, we can eliminate options "4" and "5" as the costs of climate, ecological, and social disaster outweigh the benefits of a supply of liquid fuel that is not petroleum-based. Analyses that only consider liquid fuels divert the debate, intentionally or unknowingly, from more promising solutions; it is astounding how some commentators can discuss these options as if a continued supply of liquid fuel for transport was somehow worth enormous ecological and human sacrifice.

Lamborghini easily converted this gas guzzling Gallardo to use ethanol yet producing biofuel from food crops for such a car has, in most analyses, shown more negative than positive ecological and economic effects .

Building on early optimism about biofuels from environmentalists, the biofuel lobby, unfortunately, has a great deal of influence in the United States. This is a truly tragic state of affairs in American politics, as many farmers and farm-state politicians have tied their political and economic hopes to this option. Biofuel mandates have pushed up the price of crops and created an incentive to plant and overplant corn as well as other potential biofuel crops. As fuel prices push up food prices, these prices are further elevated by the transfer of prime farmland from food production to fuel production. Without cutting biofuel incentives and mandates, there will be no countervailing influence to conserve the soil or return land to food production. Talk of cellulosic ethanol or other future innovations in biofuel production function currently as an entering wedge for the current unsustainable variety.

The only savior for biofuels is a rigorous eco-certification program that excludes the conversion of food crops to fuels, mandates soil and water conservation, and privileges the use of waste streams for fuel. Under such an international eco-certification program, biofuels will have a role as clean marine, aerospace and specialized land transport fuels.

Luckily, the coal-to-liquids option has few advocates and so far little political support. If however, petroleum prices continue to rise and so-called "skeptics" of global warming continue to be well represented in the US Government, there may be various support schemes for coal-to-liquid that are inserted into legislation. Unlike the biofuels solution, coal to liquids would "work" to move a large group of vehicles for a few decades not unlike our current vehicle fleet, but with enormous climate sacrifice as it represents an increase in carbon emissions over even the current sorry state of affairs.

In the next installment of this series, I will explore which of the three electron economy scenarios will predominate. As each scenario varies only in the manner in which electricity is supplied, i.e. generated, and not used, the below recommendations about how to create a secure post-oil transport system using electricity could apply to all three.