I realize I overlooked in my last post some technologies that will also play a major role in cutting our GHG emissions. This is an oversight on my part. I am not claiming that these 4 additional technologies will lead to more overall GHG reductions if we fully deploy the 20 listed in the first post (I arrived at a figure of approximately 93.7% reductions over 2000 emissions) but they deepen the choices and reiterate the contention of many in the anti-global warming movement that exploratory research is nice but not necessary to cut emissions substantially. More importantly, technologies already exist or will emerge, so the original list is not meant to be exhaustive or final.

Geothermal electric power – “Heat farming” from the heat of earth’s crust and mantle.  currently geothermal electric power is restricted to certain hot zones such as Iceland, parts of the western US, Italy and Australia, but an emerging technology called EGS (enhanced geothermal systems) which drills holes deep into the the heat of the lower bedrock will allow geothermal to extend its range to almost any location on earth. Advocates of EGS are asking for $1 billion of research into this technology but additionally, regulatory incentives will drive drillers, currently concentrating on oil drilling to participate with EGS plant developers. (>4% GHG reduction)

Hydroelectricity/Pumped Storage - While the building of hydroelectric dams played a key role in galvanizing the early environmental movement and still provoke strong pro and con feelings, the emergence of global warming as one of the main concerns for the well being of planetary eco-systems has raised the profile of hydroelectricity.  Some are unwilling to consider hydroelectricity at all as an option but this fundamentalist position must be reconsidered in light of newer technologies that are more conservative of river environments.  Existing dams without hydroelectric facilities can be made productive of power, while new small and medium size dams can be constructed in ways that interfere much less than traditional large hydroelectric dams.   Hydroelectricity is one of the higher quality sources of electricity and can integrate well with intermittent renewables.  Pumped storage is one of the key storage media other than CSP with thermal storage that can balance energy production with energy demand. (>5% GHG reduction)

Ground Source Heat Pumps - Ground source heat pumps are an existing technology that cut heating and cooling costs by 60 to 75%. Expensive as a retrofit, the additional cost of trenching or bore holes can be reduced when installed with the foundation during new construction. (>6% GHG reduction)

High Voltage Transmission - A much overlooked and sometimes hated part of our landscape, the direct current version (HVDC/HVAC) is a more compact, more environmentally friendly, and more efficient version. No GHG emissions are directly attributable to HVDC/HVAC but transmission will allow widely dispersed renewable electricity generators to coordinate and supply electric demand. Transmission allows the most of the top renewable generators to serve electricity demand. (enables >59% GHG reduction with renewable generators)

These can all be described as  existing or emerging.  However, the EGS system still requires a good deal of rather capital intensive development, so EGS gives partial support to the contention of the “Dangerous Assumptions” authors that research is required for carbon neutral technologies to become available, however it also highlights the need for a market incentive to drive the development and deployment of that particular technology. A temporary premium price per kWh for an EGS plant would, for instance, array market forces behind the development and eventual deployment of EGS plants. This is however, among the 24 technologies in this list one of the few in which R&D is a pre-requisite to deployment.

(With this post I’m skipping a little ahead of my series on the Renewable Electron Economy but policy debates are starting to heat up as we head into the election year. )

A recent controversy has sprung up around the criticisms of the UN’s Intergovernmental Panel on Climate Change (IPCC) by a group of fairly well-known analysts, who say the IPCC has severely underestimated the need for heavy investment in basic technology research to solve the climate crisis. In a piece called “Dangerous Assumptions” written for Nature magazine’s Commentary section, Roger Pielke Jr, Tom Wigley and Christopher Green say that “enormous advances in energy technology” will be needed to stabilize carbon levels in the atmosphere at somewhere near the target 450 ppm or below. This contradicts assertions by the Nobel Prize winning body of climate scientists that in fact we already have or soon will have the technology we need to reduce our carbon emissions to acceptable levels. Al Gore, who is due to expand upon his ideas for global warming solutions in upcoming months, has reiterated recently that we already have the technology that we need to meet the climate challenge.

In response to the Nature piece, Joe Romm, on his blog, Climate Progress, has written that Pielke Jr et al. are an example of a species that he calls “delayer-1000s” by which he means that these are people who would allow carbon dioxide concentrations to slide up to 1000 ppm or more than double current levels. Romm, a former Deputy Sec’y of Energy in the Clinton Administration, whose current mission is to popularize climate science and solutions to climate change is not averse to painting a vivid picture of what might happen under various climate scenarios. One would expect no less from the author of “Hell and High Water”, a view of what climate change has in store for us.

Romm has pointed out that Pielke and the physicist Marty Hoffert who has staked out a similar position are both affiliated with the Breakthrough Institute. As readers of this blog may remember, the Breakthrough Institute is the brainchild of controversial critics of the environmental movement, Michael Shellenberger and Ted Nordhaus who declared the “Death of Environmentalism” a few years ago. Romm has been critical of Shellenberger and Nordhaus for their propensity to attack the environmental movement and to advocate, long term research projects in ways that at least divert attention from taking immediate action on global warming. Their institute, after all, is named “BreakThrough” the point being they want to inspire government to invest heavily in long-range scientific research that they hope might lead to those technological breakthroughs.

The Big Question: Do We Have the Technology?

All personal disputes aside, the main question that is dividing Romm, Gore, the IPCC on the one hand and Pielke et. al. Hoffert, Shellenberger & Nordhaus and perhaps Google in its RE<C form on the other, is whether we, with our current technology or technologies that are in the research pipeline, can build essentially carbon neutral societies the world over within a period of approximately three to four decades. Three decades is a long time, so the notion that technology might be “frozen” at the current state of development is perhaps the first red herring that this controversy generates; within three decades new technologies will emerge in some form or other whether we have a policy for it or not. No one is suggesting that we NOT invest in research and development, though we are starting in the US at a point where much can be improved upon in the area of clean technology research.

The “Dangerous Assumption” that these critics of the IPCC are decrying is that a normal rate of technological improvement is inadequate to the task of cutting GHGs by 80% or more. Their favored policy recommendation is to have the (US) government invest massively in long-range research projects that contrasts with their critics’ emphasis on policies that speed the deployment of existing technologies. They make little positive mention of policy tools like carbon pricing or feed-in tariffs that are designed to speed the development of existing technology. The implication is that those who suggest policy drivers for deploying current technology are naïve and operating under a “dangerous assumption”. Another favored criticism that Shellenberger and Nordhaus tend to level at their opponents is that their opponents are acting/talking like the (tired, ineffective) environmental movement. Romm believes that those who support the Breakthrough concept are devaluing if not opposing immediate policy recommendations that target current technologies and current technology use.

What then is the current set of technologies that we already have or can expect to have within the next decade? I will give my account below of current and emerging technologies and list what their advantages are for reducing carbon emissions. The analysis below is represented in chart form <== or here. Following the Renewable Electron Economy scenario that I believe has the highest probability of success, I have ordered these in approximately descending order of overall carbon emissions reduction potential. Note that the order of these is approximately the reverse of the famous Vattenfall-McKinsey chart which lists the least expensive options first; here the keystone technologies of a completely carbon neutral economy come first, some of which are currently more expensive. (I am italicizing technologies in this list that overlap with previous listings in terms of their GHG reduction potential; I am putting those technologies that can act as carbon sinks in bold):

1) Combination renewable energy power plants – emerging technology that coordinates intermittent and periodic renewable electric generators (wind, wave, tidal, and solar photovoltaic or CSP without storage) with dispatchable renewables (biomass, hydroelectric, CSP with storage, and pumped hydroelectric) to serve electric load. (59% GHG reduction potential)

2) Concentrating solar thermal power (CSP) with 6 to 18 hours of thermal storage – existing and emerging technology can reduce coal use for electricity generation by 85%-90% in areas up to 2500 miles away from the world’s deserts. (45% GHG reduction potential)

3) Photovoltaic cells – existing and emerging technology that is deployable in distributed energy, remote settings. (25% GHG reduction potential)

4) Forest preservation, restoration and expansion – existing and emerging technology to fix atmospheric and newly emitted carbon dioxide; reduce emissions from deforestation. (>18.2% GHG reduction potential)

5) Wind turbines – existing technology that may be able to cover as much as 33% of electricity demand with appropriate grid integration. (15% GHG reduction potential)

6) Modularized construction of buildings with ultra-high efficiency/Passivhaus concept – reduction of 85% of space conditioning energy use. (12% GHG reduction potential)

7) Electrification of Rails and Roadways – Rail and road electrification is an existing technology that can be extended to more large vehicle traffic in regional and intercity routes (11% GHG reduction potential)

8 ) Biomass pyrolysis and biocoal burial – an emerging technology that generates a bio-oil and carbon rich “bio-coal” or charcoal that when buried fixes carbon for hundreds of years. Reduces production of energy from biomass in exchange for fixing carbon. Biocoal can act as a soil enrichment. (>10% GHG Reduction potential)

9) Batteries/Ultracapacitors with 200 Wh/kg energy density or greater/variety of chemistries - allow 90% of local and regional traffic to be electrified reducing transport energy use by 70% or greater (>9% GHG Reduction potential)

10) Biomass-fired power plants- an existing technology that with carbon capture could act as a carbon sink; dispatchable and can back up wind or solar generators. Require policy regulation to ensure non-competition with agriculture for food. (6% GHG Reduction potential)

11) Vehicle Recharge Infrastructure – existing infrastructure in detached houses, emerging in public areas; emerging quick charge infrastructure. Enables battery electric vehicles or plug in hybrids to extend all-battery range indefinitely (4% GHG Reduction potential)

12) Voluntary Veganism – vegans eat no animal products so if people go on a vegan diet for 5 days/week or more we would reduce a massive amount of GHGs. The figures from WRI I used attribute 5.1% GHGs to livestock but I have seen figures as high as 18% of global GHGs are attributable to livestock. Numerous environmental benefits are attributable to plant-only agriculture though there is and will be massive resistance to forgoing meat and milk products (including from me). I quite like meat and cheese though I did have a pretty tasty vegan meal at Café Gratitude not too long ago; this technology can be further developed by chefs and by consumers. (>4% GHG reduction)

13) High efficiency lighting/daylighting – High efficiency fluorescent lighting, daylighting, tubular skylights are here, LEDs and fiber optic daylighting are emerging cutting >75% of lighting energy over incandescents (4% GHG reduction potential)

14) Sustainable biofuels – Cellulosic ethanol is an emerging technology – because of our current liquid fuels paradigm much touted and over-hyped. To be sustainable require strict policy oversight or voluntary certification – in the Renewable Electron Economy would fuel air and sea transport along with bio-oil. (3% GHG reduction potential)

15) Wave and tidal power – Existing and emerging RE generation technologies (3% GHG reduction potential)

16) Electric Arc Heating/Biocoal – Electric arc furnaces already are used in melting steel scrap and a similar principle or biomass substitutes could be used in high temperature industrial applications in place of coal and natural gas (2% GHG reduction potential)

17) Magnetic Induction Heating – Existing technology allows for hyperefficient stovetop cooking with electricity; future applications may allow for more efficient electric ovens. (1.75% GHG reduction potential)

1 Syngas waste to energy – Generation of a syngas from municipal waste avoids the formation of dioxins and other toxins; emerging technology can reduce waste by 95% entirely avoiding methane emissions (substituting less potent carbon dioxide) and reducing the need for landfill space except for separated toxic metals, producing dispatchable electricity from the combustion of the syngas in a gas turbine (>1.5% GHG reduction potential).

19) Methane harvest from sewage – capturing methane to generate power or fuel vehicles from sewage (CH4 to CO2) (>1.0% GHG reduction potential)

20) Enhanced telecommunication technologies/holographic presence – reducing business travel by 75% - extension of Internet/videoconferencing capabilities. (>0.5% GHG reduction potential).

These by the standards of 2008 exciting but in no way futuristic technologies deployed on a global scale have the potential to reduce our GHG emissions by at least 93.7% with little effect on end user “utility”. The most significant change in end use, and perhaps the most challenging, is the voluntary (or incentivized) reduction in the use of animal products.

The conclusion then to be derived from this analysis is that we do not NEED radical new technologies to reduce GHGs very substantially, especially if we follow the Renewable Electron Economy model and are willing to invest as a government AND a society in clean technology. Such innovations might be nice to reduce costs or ease the transition but they are not necessary.

Therefore it would seem that Pielke et al. and their supporters’ assertions would seem to be more lobbying for gee-whiz science projects rather than scientific analysis.

Potential Criticisms of This Model

1) I am using year 2000 data that may be no longer reflective of current emissions or future trends.

a. Response: These technologies are mostly highly scaleable so that more or less of them could be deployed in response to changes in GHG emissions profile

2) Veganism is a substantial sacrifice for most inhabitants of the developed and rapidly developing worlds

a. Response: If this is a planetary emergency, some sacrifice of personal utility may eventually seem like a rational response. Even if people choose a reduced meat/dairy diet, which will have substantial GHG benefits, they will not lose the taste experience or dietary benefits of these foods. This remains by no means a high tech or inaccessible solution and culinary giants might even improve the technology through inventive use of vegan ingredients.

3) The numbers I am using for GHG reductions are guesstimates.

a. Response: Each of these technologies substantially reduces GHGs in each of the major acknowledged GHG sectors; most can be scaled up or down with fairly wide latitude, even accounting for a 30% increase in global population.

Do These Roads Diverge?

If what I have laid out here is anywhere close to being a realistic assessment of existing and emerging technologies, the course of action is pretty obvious: get as many of these technologies in deployment as soon as possible. Pricing may be higher in the beginning, which could be shouldered by richer countries but then economies of scale in manufacture will bring many or all of these within reach of some of the rapidly developing countries that are the focus of concern.

I believe the strongest policy combination is some form of carbon pricing with the addition of performance based incentives, such as feed in tariffs to promote key technologies more rapidly than the politically acceptable carbon price will allow.

Research and development is not excluded from any policy recommendation but the emphasis on technology investment almost to the exclusion of contemporary policy drivers is a curious phenomenon. Research and development, be it at current levels or at levels 50 or 100 times as high, is a traditional role for the US government and is no departure from business as usual.

Will an Emphasis on R&D Lead to Delay?

Rather than resort to name-calling, there is a very serious issue here that has been lent extra urgency by the publicity lent to Pielke’s/Breakthrough’s position through its publication in the prestigious Nature journal.

As I state above, Breakthrough/Pielke are packaging their position as heterodox and daring when in fact it is a simple restatement of a very common position that the US government has occupied throughout the last half century: the funder of basic and applied research in the sciences and energy. Maybe the AMOUNTS that Pielke/Breakthrough are asking for are larger and are applied to a new theme (solutions to climate change) but the format and relationship of government to constituency are the same.

The folk at Nature may have felt that as it is a plea for more money for research it is a natural fit for their science journal. However, they may not have been in a position to evaluate how uninspired the Pielke piece is in terms of its actual policy recommendations.

Nordhaus and Shellenberger, the founders of BreakThrough, seem to be laboring under the belief that their advocacy of more money for research is a break from the past and perhaps it is a break from THEIR past. They have made a great deal of their differences of opinion with leaders of the environmental movement and, in a way, are more likely to discount anything that agrees with the consensus of that movement. Thus they are able to occasionally get publicity from the wider media world as they “turn state’s evidence” against their former colleagues. In a way, Joe Romm, by attacking Nordhaus and Shellenberger is continuing to play into this game.

Whatever their motivation, if someone were to consult Nordhaus and Shellenberger as policy experts, they would get the distinct sense that all the action is with R&D investment and carbon focused policy instruments are at best dull necessities.

If a policymaker came away with that impression, I believe there would be a lost opportunity to create policy drivers that incentivize accelerated deployment of existing technologies.

Apollo Project or Liberty Ships?

Furthermore, there is a tiresome formula into which the S&N recommendations as well as the public face of Google’s RE<C fall into: that technology advances are about what might be called ecstatic gee-whiz moments of wonder, of dramatic breakthroughs. The microelectronics and the biotechnology revolutions have, I believe, spoiled the public, investors and commentators into thinking that innovations occur in an accelerating crescendo. A study of renewable energy flux, along with its synchronization and storage problems leads us to the conclusion that the creation of large industrial scale operations to build large numbers of renewable generators and install them more efficiently will be a much bigger portion of the renewable energy revolution than the micro-world of molecules and atoms. Yes, there are admirable and elegant designs and inventions that have already occurred and that will occur in the future, but there will also need to be large scale deployment and manufacturing in a way that hasn’t been seen here since the second world war.

In a way, the beguiling high-tech metaphor of the Apollo Project, which Nordhaus, Shellenberger and others drew upon in founding the Apollo Alliance, is a little misleading. Apollo rockets were one or two of a kind, though obviously some of the technologies were later commercialized in larger numbers. What we are talking about more is the far more profound and economically stimulative wartime mobilization of WWII where one had both a Manhattan project going on and the broad participation of the population in accelerated wartime production. In fact, as impressive as some of the achievements of the Apollo project were, the manufacturing techniques that enabled shipyard workers to build a complete Liberty Ship, on average in 42 days through pre-fabricated assembly of ship parts will be just as or even more crucial than more glamorous inventions of the past half century.

To drive this scale of production, there will not only need to be government involvement but also stimulation of private actors through regulation and market incentives to move this process forward. To push all of the action off on R&D and government spending is not to grasp the need to drive change, in the most effective and forward-thinking way, in the entire economy.

With adequate information about the dangers AND opportunities we face both economically and ecologically, more and more people will realize that cleaner and better energy and energy services will need to be paid for. While Romm seems to shy away from embracing the fundamental break with what I call the Cheap Energy Contract, Nordhaus and Shellenberger are still obeisant to the assumption that people in the US will not be willing to pay more for energy in order that it become both a source of employment and profit for them and their neighbors and free us from some of the geopolitical problems we have blundered into.

I believe this attitude of remaining entirely supine in front of our own wishes for cheap stuff is unsustainable for us as an economy; eventually we will need to be willing to or required to pay each other for our work and pay for a cleaner environment rather than continue to pay more and more for our fossil fuel addiction.

I wanted to alert readers of this blog to an interesting exchange I had a few weeks back with Phil Timmons on my posts on the Electric Farm from last November.  I appreciate Phil’s expertise in this area and willingness to think out of the box about the practical equipment requirements that face farmers (and miners).  Given the ongoing price spikes in food and oil, I am hoping that the Electric Farm concept gets some more attention.  If interest grows among farmers, engineers and tinkerers we might be able to get more minds working on the problem of developing a sustainable but machine-assisted agriculture, where farmers can either generate their own energy for machines on the farm or draw energy from a increasingly clean grid.

I’m reposting the exchange below:

Phil Timmons:

Hello,

Read this story after finding a link to the earlier first part. Thought the first was an excellent overview.

I am an EE working on utility scale RE projects, and from prior life experience, electric farming is of particular interest.

Just as observation — it seems this follow-on story falls in the Electric Vehicle “battery trap.”

Why the assumption that it would be needed or desired to operate the equipment on batteries? That tends to be very lossy — first in charging the battery, and then in recovery of the energy from the battery.

Electricity tends to be dynamic and likes to be used as it is generated. Have you began any studies into non-battery farming applications, or have any interest in that?

Thanks for your efforts, I think you are doing very good work.

• Edit Comment

By: Phil Timmons on March 11, 2008
at 7:40 pm

Phil,
The point of the Electric Farm concept and the Renewable Electron Economy idea is that you are using batteries to power devices for a number of reasons outlined below. The Electric Farm wouldn’t be electric without batteries, though I suppose that a PHEV or multifuel tractor are suitable transitional vehicles.

The 15% round-trip loss of batteries charging and discharging I don’t consider to be very significant in comparison to the energy losses associated with competing fuel cycles. With biofuels or petrodiesel you lose 70% of your energy to heat in the engine which doesn’t even include the highly inefficient process of turning sunlight into biofuels via plants (as well as all the other issues associated therewith) which contains perhaps 0.5% of the original solar energy in it. The hydrogen fuel cycle loses 65-75% of the original energy of the renewable electricity and hydrogen has its storage problems as well.

So if we are to create a sustainable, affordable, mechanized agriculture, we will either need to prioritize and subsidize the use of petroleum in ag until the point when batteries and RE comes down a lot in price, or certain brave souls and companies will start pioneering the use of electric drive tractors fueled by renewable electricity. It will help if there emerges a discipline called “agro-ergonomy” which studies and reduces the amount of mechanical work per unit crop output, thereby reducing the amount of mechanical energy required to produce food (no- and low-till organic ag would be starts). It could be that we become so clever in our use of mechanical energy to farm and biofuels progress to the point where we won’t need much of them to cultivate food. But you will still be able to do many times more work with less of an ecological footprint with electric tractors and renewably generated electricity, stored in batteries that will be more energy dense than the current crop.

By: Michael Hoexter on March 11, 2008
at 9:57 pm

Phil Timmons:

I guess I am still lost on the MUST-HAVE-BATTERIES dogma. (or bio-fuel for that matter).

Sorry, but I did not see any reasoned connection between converting available electric power to battery stored power and then converting it back to electric power just to use the electric power that was present to begin with. Does doing that make sense to you?

Not only are the losses (already mentioned present), but the start-up costs are much higher for including those batteries, as well as long term maintenance and replacement as they are limited life equipment.

Like I said, I think you started hard on the right track with citing the local generation of renewable energy to power equipment. That is great. But to not just use the power directly while it is there does not make sense. To borrow an old farming phrase — Make hay while the sun shines.

Your targeted numbers — 250 kW for example — is an excellent farm scaled application. (btw, while the exact math may say that is over 300 hp, in practice we do not budget much more than 1 hp per kW.) 250 kW / 250 HP is a reasonable output from an acre of solar thermal electric generation — which already is cheaper than coal — not talking PV, but rather solar thermal.

So sitting one acre aside can run all the power consumed by 100’s of acres. If this is roof mounted, a couple of large barns, as well as housing and garages can be placed under this.

So that 250 HP can easily run irrigation during solar prime time, as well as most other equipment during other times.

Maybe the battery thinking is from being sort of stuck on a model of equipment that goes round and round and back and forth across a field? As you may know center pivots (irrigation) and linear irrigation already do that with electric drive and no batteries.

Further, large scale electric equipment does not need batteries by virtue of its size, either. I have worked with 1500 hp draglines (large shovel cranes that could eat a whole farm in a day) and these use no batteries — just cord connections from line power.

While I can see the use of some battery vehicles to zip hither and yon (have put an forklift drive motor on a small tractor, myself, and run it both by cord and batteries), to do the mass grunt work with batteries is not real sensible to me when straight up direct power (DC or AC) is available.

Maybe this is a concept conversion thing we are stuck on? Sort of like a farmer of old looking over a modern tractor to figure out where the hay and oats go in? (still thinking in “horse” mode).

Electric farming would not need or probably even want to have equipment that was designed and optimized around petrol in a post-oil world, any more than one would want or need a harness or whip to drive a tractor.

But if you are interested in doing an exploratory essay on methods for profitable post-oil, all electric farming without batteries, I would be happy to help.

• Edit Comment

By: Phil Timmons on March 12, 2008
at 6:22 am

Phil,
Thank you for your out of the box thinking. It may very well be that electric farming implements or vehicles will be able to remain plugged in as they do their work. I have seen pictures of old Soviet farm equipment that uses trolleybus style poles on overhead wires.

Staying plugged in may be an option for some farms or types of farming but in other settings it may soon require too much electrical infrastructure built around some fields.

Also, I think commercial farmers would have a lot to say about the inability to use energy when the sun ISN’T shining. Our agriculture has evolved both under animal and now fossil fuel energy inputs to be able to work at night or under poor light conditions. At harvest or planting time, some farmers will work around the clock. There are so many timing issues involved that I wouldn’t want to dictate to farmers when they would have to use energy. There are going to be a lot of crop losses if farmers can’t use their machines whenever they need them.

Batteries (or a grid connection if the implements /vehicles can remain plugged in) will be well worth the investment. As I point out in my essay, the extra weight of batteries can be used as ballast for pulling heavy loads: now tractor operators need to add weights when they need extra traction. Plus having a stack of batteries connected to the grid will give farmers an additional source of income to help stabilize the grid (selling ancillary services) or store cheap nighttime wind power from neighboring wind farms. So, while I can see that you engaging in a thought experiment, my sense of the future indicates lots of electric energy storage. On the other hand, experimenting with different task requirements with different energy requirements will continue to occur, perhaps minimizing the need for storage.

So, I don’t see the emphasis on batteries as a lack of imagination or a fixation: the functionality they offer is well worth the 10-15% charge-discharge energy loss they represent.

Still, you may well yet invent the grid-tied farming systems of the future, I would assume in close collaboration with commercial farmers!

• Edit Comment

By: Michael Hoexter on March 13, 2008
at 6:06 am

Phil Timmons responds:

Hey Michael, interesting discussion, thanks.

Used to do commercial farming back a life-time ago. Corn, wheat and soybeans.

Can’t remotely take credit for any invention in this regard, just observation of another industry that tends to use non-battery electric power day or night, in 24 hour operations, year around, with all sorts of weather (far more demanding than farming).

Mining.

Typically mining operation have far more material moved, are far more remote than most farms, and much larger footprints. (all challenges to full electric power). But the typical mine operation uses almost all electric — either self-grid or commercial grid operations.

Electric mine cars trains for underground, dragline shovels above ground, and conveyors and electric trains above ground. Even the typical large Terex dump trucks (diesel) that we tend to associate in popular culture with mining (sort of like tractors are associated with farming) are used less and less, and now only until the conveyor(s) (all electric) get built.

Like I was mentioning above, a solar thermal electric system (and again NOT PV) of about one acre produces power to more than cover the heaviest use by most farming applications. Most of the year would just be sending power up to the grid. During times of heavy operation or off-hours the farm can draw from the grid. But when looking at electric power sales versus electric power costs, that should be a net money maker for the farm, as well.

=============

I know the following is not your issue, but for other readers, I probably need to jump into some myth busting at this point . . .

There is no electricity shortage in the US. At most there is a time of use issue. Only during times of “peak” use do we come close to using what is available. Peak in the market I design for – Texas and the West – only happens in the middle of Summer, in the middle to late afternoon. Everyone has on the Air Conditioning. And that is it. We turn on all the Gas plants and hydro in addition to the base load coal and nuke plants and run them into early evening while the day cools down.

Most of the time, there is so much base-load power available that entire coal plants are shut down and taken off line for rebuilds in the Spring and Fall, when electric power use drops.

The sham “need to build more nukes” you hear from folks with no knowledge of the power industry is ALL marketing hype being mindless repeated. The proposals for building of new nukes are that it would 80% government funding. Not only costs more, but takes years and years to build. This is a huge welfare program for the contractors/builders. Costs more to operate and then leaves a mess to clean up, as well. Build, operate and then clean up – all losses.

There are lots (and LOTS) of surplus electricity on the grid. Base load power is cheap to buy and there are large discounts to use it off-peak. Solar thermal electricity produces best during the peak use – the methods discussed here would put MORE power on the grid during peak and only consume from the grid during off peak.

With that out of the way . . . back towards what drives all the tractor and energy use on the typical crop farm . . .

================

Creation of the seedbed.

The need for a good seed bed is what drives the use of a plow. A mold board plow flips the dirt like a slow motion wave breaking along a sea shore. This places weeds and organics at the bottom of the wave to compost, and fresh dirt to the top. For tmi — http://en.wikipedia.org/wiki/Plow

The entire mold-board plow system is what created the need for the high pulling power for the high traction and high power tractor. Often a tractor is described in draw bar horse power – which is essentially its pulling power. An interesting aside — the “traction” portion of the word Tractor is now what we now totally associate with farming just as somewhere around 100 years ago, draft horses would have been totally associated with pulling plows (hence “horse power”).

The rest of the seedbed creation — After the mold board plow turns over the soil, a disk harrow is pulled over it to break up the clumps, and then a wide “drag” is pulled to smooth the soil to plant seeds. So that is typically four passes across the field just to get the seeds in the ground.

The “lite” version uses what is called a chisel plow that is a one pass plow to break up the top of the soil, followed by a drag and then planting. Again that is covered in the wiki article.

But in al that, it is the high traction / pulling power tractor is needed for plowing that is driving the methods – which are modeled after the horse methods they replaced. The other implements are made wider and wider to attempt to efficiently use all that horse power available.

There are a couple of alternatives to using this method to create a seedbed. Like you mentioned the Soviets did have some creativity. Even using surplus Army tanks (high power and high traction) to pull plows.

One alternative to tractors I have seen from the Soviet era was a cable pulling method that would drag a plow across a field to a stationary winch. The winch was moved down the edge of the field, so the motive device was required to only be mobile in one dimension. A present day electric grid application of this may be to run a power line down the edge of the field to power the winch and pick the power from the line as the winch moved along.

Current US farming does something like the cable pull method in a system called “travelers” for irrigation. An anchored cable is pulled onto a winch on a mobile wagon-mounted irrigation water gun. The power of the pumped water pulls the cable onto the wagon, moving it across the field while dragging a large water hose behind. These are often electric (grid) powered via a motor and pump which provides the water pressure that makes the whole system work.

A method that I am looking at for total electric (non battery) creation of seed bed is use of tiller/cultivator methods – and yes, this is typical small garden method, but there are commercial farm tractor methods of using tillers – here is an example — http://www.riouxinc.com/BushHogTiller.htm

As these require mostly rotational power – and not traction power, like a plow – they are well suited to be turned by electric motors. As they churn and pass through the soil they create a seed bed that is suitable for planting, and a planter can pass along behind in the same travel. This does the entire 4 pass (plow, disk, drag and plant) in one pass.

I am looking at mounting large scale electric motor powered tillers on a frame like a center pivot, with electric motor wheels – again like a center pivot. So all this could be done while using no batteries, hydrocarbon based fuel, nor bio-fuel, just electric line power, either produced at the site or from the grid, with the power coming down the frame.

After planting comes fertilizing, irrigation and cultivating (mechanical removal of weeds) if desired. As you are probably familiar center pivots and other style irrigators, you can probably see that using liquid fertilizer can directly deliver fertilizer to the field without use of petrol, bio-fuel or batteries. Again just line power driving the pump and drive wheels.

Mechanical cultivation is one area I can see use of small battery power tractors such as you are discussing, however, with current planting methods and weed herbicides, this is not often done in commodity grain crops anymore.

And then finally getting the crop out of the field. The largest challenge with a combine/harvester is tire floatation – or bearing of the weight — on the soft field surface – not really a power or traction issue. Adding battery weight to this would not be a good thing.

It is often the weight of the grain being collected on board that bumps the limits of design capacity. A 300 bushel grain tank holds 9 tons. (300 bu. X 60 lbs/bu = 18,000 lbs = 9 tons).

I recall one Thanksgiving Day some years ago — working 23 hours straight as a Canadian blizzard was bearing down on us. Only stopping to refuel and grab some turkey and keep going. What forced the situation were wet fields and the weight of the combine would sink and get stuck in the mud. We had to wait until the ground froze and then beat the snow. Finished the last hour as snow was blowing in about horizontal in a 40 mph wind.

But what drove all that fun was the equipment and the methods used – which is still about the same today — 25 years later.

A method I am pondering for this is again using the center pivot style frame with small grain heads (the front end of a combine) attached, feeding a cylinder (the part of the combine that breaks the grain from the shell or cob) and then vacuum/blowing the grain back to a central collection point down the structural pipe that would normally be used to provide water out along the irrigator. Again, no petrol, bio-fuels, or batteries required. This keeps the weight of the collected grain back at central storage area, rather than being hauled around the field.

If folks really really wanted to use the conventional tractor methods, I have considered some options for that as well – one could take an old Steiger and put a 200 to 400 HP industrial electric motor in it in place of the diesel and have a super tractor for about 1/5 the cost of a new diesel. Run it from dragline cable – like the mine shovels discussed above, and off you go. That would last for decades and save its cost many times over in the (non) use of fuel.

Existing Clean Energy Finance Mechanisms

In the last couple posts in this series, we’ve established that in industrial economies, price expectations for energy are low for fundamental economic reasons (mechanical work must displace human labor or animal work) but that in the US and Canada, these expectations are further depressed by low population densities, in many locations extreme ambient temperatures and temperature swings, and a preference for “big” vehicles and buildings. All of the latter mean that more mechanical or thermodynamic work needs to be done by energy-consuming machines to reach a desired outcome. As petroleum prices soar, we are starting to feel the pinch of an economy based on exhaustible fossil fuels, priced well below their actual costs for too many years. The direct and indirect subsidies to fossil fuel extraction and overuse were part of the now somewhat outdated Cheap Energy Contract that holds governments and energy regulators responsible for keeping energy prices much cheaper than actual costs, especially if we take into consideration the environmental and climate costs of fossil fuel combustion.

The expectation that energy be cheap and our heavy reliance on these massively subsidized but polluting forms of energy, present special challenges for the building of a new clean energy system. Transforming the energy business involves building large amounts of infrastructure that must be financed either through tax revenues (thereby subsidized by other parts of the economy) or private investment that is paid back through consumer payments for energy or energy-related goods or services. If the prices of the latter must be low, private investment will not be commensurate to the task as investors will have few chances to see their money again with a reasonable return. If additionally there is an anti-tax bias in the country, there will be few funds available from public coffers to finance infrastructure.

The major costs of renewable energy, especially renewable electric generators, are the initial capital costs of the generators, transmission lines, and the clean energy storage devices we will eventually need to balance energy flow on the grid. The fuel is free renewable energy flux but as we have learned, that flux is, in the case of the most plentiful forms (wind and sun) not of such a high power density, so renewable energy technologies must take in a wide cross section of that flux to come close to matching the output of conventional generators using more compact fuels. This means building many capture devices and large storage devices. “Many”, “large”, and “new” mean a greater initial capital investment to match our current power needs, front-loaded costs that must be paid over time.

The critical importance of increased energy efficiency in this equation is reducing at some point in the future the overall societal need for capital investment in future clean generators as well as being able to throttle back now on existing fossil generators and the development of new polluting generators.

If the Cheap Energy Contract is becoming difficult to sustain for a whole host of reasons, alternative society-wide economic agreements about energy finance are still in flux. There are a number of contenders, none of which have fully established themselves in an era of dwindling fossil resources and increasing carbon constraint. Many are “end runs” around existing social agreements about energy pricing and the building of new infrastructure.

No (Energy) Social Contract, No Subsidies

Some players on the energy market (many of whom believe they represent the lowest cost producers) claim that regulations and government subsidies raise the cost of energy. These energy free marketeers echo sentiments of libertarian (a.k.a. neo-liberal) economists who believe that less regulation automatically leads to markets determining the least expensive price for energy by competition. A totally unregulated market in energy would not price in the cost of pollution including carbon emissions. Some green-inspired market advocates then would allow a cap and trade system to assign a cost to carbon emissions without other new regulation or government subsidy.

Carbon Pricing

After Kyoto, groups of regulators and activists worldwide have been working towards assigning a price to carbon emissions that may have the effect of driving energy markets towards cleaner solutions. Within this general model there are two contending groups: one that believes the carbon price should be set by a cap-and-trade system that determines the carbon price by the balance of supply and demand for pollution permits and the other that believes that a carbon tax or fee set by regulators is more efficient. In either case, the price on carbon will at least start driving energy users towards more efficient use of expensive energy. It is doubtful that at this point in time, regulators will set or engineer the carbon price to be so high as to advantage some of the currently more expensive renewable energy solutions in a purely economic comparison. At very high carbon prices, great economic pain would be inflicted for a number of years as low carbon alternatives to our current energy conversion system would take a while to develop and represent singly and together large capital investments. Those who hope to rely solely on carbon pricing tend to downplay the historical benefits that fossil energy producers and fossil electric generators enjoy representing and benefiting from as they do decades of sunk costs and subsidies that most carbon pricing systems are not designed to account for; therefore they can act as a catalyst but only at very high levels will switching to renewable fuels appear high on the agenda.

Tax Credits

The American renewable energy industry has some large wind, geothermal and solar projects on the ground because of tax breaks that large institutional energy investors have benefited from on and off over the past couple decades. The ITC or Investment Tax Credit allows investors to write off 30% of their investment from their taxes while the PTC or Production Tax Credit provides investors in certain mostly renewable generators a few cents tax credit that adds up to a substantial incentive. The ITC and PTC were cut out of the Energy Bill of 2007 and are now again up for a vote and potential veto by President Bush. As a form of renewable energy finance, the ITC and PTC have been effective for those renewable energy projects that have won power contracts with utilities and can otherwise compete on cost inside US utilities’ generation portfolios. The tax subsidies have worked best as supplements to other forms of subsidy and pro-renewable regulation.

Tax subsidies have proven to be politically vulnerable because they are a form of indirect subsidy that are difficult to understand or empathize with for the average voter. Furthermore the benefit of these subsidies has accrued in the US disproportionately to larger renewable projects. The current funding plan to reinstate the ITC/PTC pits the renewable energy industry and its Congressional supporters directly against fossil fuel companies and their allies that has led to the current political fight over reinstating the tax credits, the outcome of which will be decided soon.

Direct Subsidies

US, Japanese and European governments have long funded research into renewable energy through various national labs and grant programs. In addition, some demonstration or early commercialization stage power plants have received grants as a way to reduce risk and help obtain additional private funding. While the US has not under the current administration directly funded the building of new power plants, the European Commission has issued grants to help build new solar power stations in Spain.

As I noted in my post introducing the Cheap Energy Contract concept, there are green energy supporters who believe that massive pre-commercialization subsidies either from the side of government or grants/investments from private sources will create revolutionary cheap renewable energy technologies. Shellenberger and Nordhaus see government investment in renewable energy research as key to what they have named their book and think tank, a “breakthrough” in clean energy generation costs. Google’s RE<C strategy sees private investment as a partial or complete replacement for government subsidy to the same end.

Both direct and indirect subsidy by government requires at some point tapping into revenue from taxes, either revenue diverted from existing budgetary items or revenue from new taxes.

Rebates

Some financial subsidy to renewable energy takes the form of upfront payments upon the purchase of a renewable generator, mostly small generators for homes or businesses. The California Solar Initiative is the largest example of a rebate program but other US states have had similar rebates. Funds for these payments usually come from the electric rates paid by all ratepayers within a region or they could also be paid through tax dollars. While these programs in combination with tax breaks have been able to stimulate solar development, there are reports that these programs are overly bureaucratic and are not stimulating enough renewable energy development. The advantage of a rebate program for residential customers and small businesses is that it lowers the upfront payment and lessens “sticker shock”.

Renewable Energy Quota Systems

Certain states in the US and various European countries have adopted requirements that utilities generate a certain percentage of the electricity they sell from renewable sources by defined target dates. Renewable Portfolio Standards or RPS laws assess fines to utilities that do not achieve these goals. With the RPS, a utility is supposed to find the “least-cost” renewables though there are some RPS laws that stipulate carve-outs for particular local resources, requiring that a certain percentage of the RPS be wind, solar, etc. By arrangement with regulators, utilities should be able to recover any disparity in cost between the renewable resources and regulated generation rates though this is not necessarily a part of the RPS law’s intention: the notion being that in the requisitioning and bargaining process the cost of the renewable generator will be brought down in price to levels close to the (mostly fossil) market rate. RPS laws are present in some US states, varying from levels such as California’s 33% by 2020 to as low as 5% in some states. Some states are allowed to fulfill their RPS requirements by buying green energy certificates from outside the state.

Without carve-outs for particular resources or technologies, RPS statutes drive utilities to buy energy from the currently most mature, least expensive technologies, usually onshore wind. The quota does not place the positive motivation for achievement within the actors who make the crucial decisions, the utilities, who are put in the position to avoid a penalty rather than gain a reward. Some leaders of utilities with a better regional energy mix, with a keener business sense, or with ethical motivations have taken a somewhat more inspired and creative approach to the RPS mandates than others. As RPS’s are based on achieving a standard level, overcompliance is not necessarily rewarded.

Renewable Energy Certificates/Green Power Marketing

RPS’s and voluntary carbon offset programs are often backed by “green tags” or REC’s (renewable energy certificates). These certificates are a way for investors in renewable energy to make additional money in excess of the wholesale electric rate they earn by selling the green “attribute” of generated power to third parties not involved in the power sales transaction. RPS standards that allow the purchase of RECs are big stimuli to what is called sometimes “Green Power Marketing”, i.e. the selling of RECs. These tradable certificates are the closest thing to a “free” market in renewable energy; notably they are a derivative of the energy itself, traded on an auxiliary market rather than a payment for energy delivered.

Feed-in Tariffs: A New Energy Contract?

With the exception of carbon pricing, in the US system some combination of the above are currently operative, yet there is growing interest in feed-in tariffs, a system that operates on different principles than each of the above. The reason for this interest is that for most concerned policy makers and renewable energy activists who take the threat of global warming seriously, transition to a Renewable Electron Economy is not happening fast enough. Many states are lagging in achieving RPS goals. The general agreement that a move to renewable energy is advisable has not been backed up with policies that enable effective action. Because of rapid rates of installation of renewable generators, people are looking to the example of Germany and Spain, where feed in tariffs have been most successfully established. Germany more than doubled the amount of renewably generated electricity on its grid from 2000 to 2007 (6% to 14%) while Spain has moved up to become the number two producer of wind electricity and is leading the fast growing solar thermal electric industry.

Feed-in tariffs represent a “New Energy Contract” in that they are a social agreement that re-prices energy to allow a transition to a higher proportion of renewables in the electric system. Feed-in tariffs are performance-based incentives that pay premium per kilowatt-hour rates to renewable generators to compensate them for early adoption of new cleaner technologies. Feed-in tariffs in their most successful forms are priced to reflect the cost of generation plus a reasonable profit. The point is to help jump-start the renewable energy industry by rapidly creating economies of scale in the manufacture of technologies like solar panels, wind turbines, solar thermal collectors or geothermal exploration and well-drilling. Furthermore the stable return on investment for generators reduces the finance costs for projects, which ordinarily are very high for new riskier ventures. FITs are a form of open 10 to 20 year power purchase agreement for qualified generators in distinct categories. Grid access and payment are guaranteed for generators that meet whatever the qualifying criteria that are set in the feed in tariff law. The costs of the feed-in tariffs are borne by all ratepayers in proportion to their electricity use and in Germany currently account for 3% of electricity expenditures by consumers. A rate-pooling mechanism across the widest possible rate-base is desirable to spread the costs among the beneficiaries as we all benefit from increased use of renewable generation.

As an example of a FIT menu of tariffs, in Germany the 2009 onshore wind tariff is 8 eurocents/kWh, offshore wind 14 eurocents, large solar PV farm 35 eurocents, small roof-mounted PV 45 eurocents, hydroelectric 4 to 7.5 eurocents depending on size, biomass 8 to 10 eurocents with a 2 eurocent bonus for innovativeness or district heating, geothermal ranging from 7 to 15 eurocents depending on size.  Tariffs can vary depending on the strength of the renewable resource as well as on the size of the generator itself.  A full menu of feed-in tariffs can extend one or two pages at most, detailing distinct classes of generator by size or location.

One difference between feed-in tariffs and other policy instruments is that feed-in tariffs can operate almost entirely as a standalone policy alternative, depending on a few social institutions for their effective growth. Feed-in tariffs benefit from a financial system that recognizes feed-in tariffs, is prepared to offer low interest loans based on the security of the tariff, and also allows mutual fund-style joint investment in renewable generators, allowing small and large investors to participate. Unlike tax based systems in the US, the funding for feed in tariffs runs largely through the private economy; emphasis is placed on the bankability of a project under the tariff system. Funding for a solar installation on a home or apartment building can become as simple as getting a car loan, while funding a large renewable installation will after financial due diligence enjoy the interest rates usually accorded the lowest risk business loans. Feed-in tariffs are successful because when priced right they are a strong incentive and design the electricity market to prioritize increasing the proportion of renewable generators. They also incentivize the project builders and owners themselves, those who make the decisions to site and buy renewable generation technologies. Yet they also put pressure on plant developers to efficiently design, situate and maintain their generators as payment is contingent upon producing electricity.

Historically feed-in tariffs of any sort were actually first formulated in the United States in 1978 with PURPA which required utilities to buy energy from renewable generators at the “avoided cost” of fossil generators. PURPA was implemented differently state by state and had a mixed history of success in helping the US renewable energy grow. PURPA also was criticized by some as expensive in an era of low natural gas prices as well as lack of acknowledgement of the cost/benefit ratio of renewable generators. In California, the first generations of wind turbines and some early solar installations have their roots in California’s implementation of PURPA.

German legislators from Left and Right in the 1990’s arrived upon feed-in tariffs as a way to promote local and regionally produced green energy and protect it from lowball pricing by the German utility industry. A product of the collaboration between the very conservative CSU and the Greens, the original tariff was a guaranteed per kilowatt hour wholesale price to small hydroelectric plants, wind generators and solar installations. In the year 2000, the pricing formula of cost plus a reasonable profit was instituted in the first German Renewable Energy Law (EEG) to further promote the development of economies of scale in a wider range renewable technologies. The new law introduced the concept of “degression” which means that future manufacturing efficiencies are forced by reductions in the per/kWh cost each successive “class year” of generators. The German law is considered an unqualified success for the German renewable energy industry that now employs approximately 210,000 people in a country of 82 million people. In a country without the traditional large hydroelectric resources of its more mountainous neighbors in the EU, Germany now generates 14% of its electricity from renewable sources with the goal to reach 25-30% by the year 2020.

Some critics of feed-in tariffs claim that they are not competitive or market-based but analysts of these tariffs point out that they are just different market design mechanisms than other renewable promotion mechanisms. Feed-in tariffs shift competition from between merchant generators or project builders to competition within each technology type between technology companies. The lowest cost/highest return technology will get more business as projects built with that technology will be able to make more money.

The nomenclature “feed-in tariffs” is considered to be not very descriptive nor euphonious, so people have suggested a number of alternatives. A leading US feed-in tariff advocate and consultant, Paul Gipe prefers “advanced renewable tariffs” which distinguishes older “feed-in” arrangements to the grid from the second generation of tariffs. U.S. Representative Jay Inslee has called them “Clean Energy Buy Back” in his recently introduced national legislation.

Spanish Innovations

Both Germany and Spain have had a great deal of success with feed in tariffs but actually implement them differently. Germany have fixed tariffs that are determined using the formula average project cost plus reasonable profit and a fixed reduction of the tariffs for each generation of generators to pressure the industry to become more efficient. The Spanish have added to this a market option that can allow generators to make more or less money than a fixed tariff depending on the momentary demand for electricity and therefore its market price.

In many countries now with partially or completely deregulated electricity systems, wholesale electricity generation prices are determined either in anticipation of or by the minute-by-minute balance of supply and demand. There are also markets for additional services that help stabilize the grid. In Spain renewable generators are being encouraged to participate in these markets by being able to opt into these markets while still enjoying some bonus for their clean, renewable attributes.

In the Spanish system then, every year generators can choose whether they want to be compensated with a constant, German style tariff or operate by what they call the premium tariff system. In the premium tariff system, a generator can be compensated either a little less than or somewhat more than the fixed tariff for their technology depending on the market price of electricity at the time of generation. In the case of concentrating solar power or solar thermal electric, in Spain a generator can chose to be compensated at a fixed rate of 27 eurocents per kWh or be compensated somewhere at a rate between 25 and 31 eurocents depending on the market price of electricity at the time of generation. The latter scheme is more remunerative for a solar technology and may also incentivize the use of thermal energy storage to take advantage of late afternoon and evening peak demand. Most generators in Spain opt for the market option as it generally pays off. The Spanish system also allows the tariffs in existing agreements to be adjusted by as much as 2% a year to reflect inflation or changes in cost. Furthermore, in Spain, generators over a certain size are required to forecast their output to grid operators or be penalized.

The Spanish premium tariff system is then designed through successive generations of installations to gradually bring renewable generators into a wholesale electricity market where time of use and other services to the grid and electricity consumers will become the basis for payments in the future once cost parity between conventional and renewable generators has been reached.

Pre-conditions for a Successful Feed in Tariff System

If feed-in tariffs are the most successful system for accelerating renewable energy deployment, what conditions need to be present for these policy instruments to actually work?

1. Social acceptance and enthusiasm needs to be widespread for transitioning from fossil to renewable sources of energy, allowing marginal increases in electricity cost in exchange for cleaner energy. Some social and political patience will be essential in meeting inevitable challenges and adjustments required to work out the nuances of any new program.

2. The tariffs should be set at a price that compensates plant builders for their costs plus a reasonable profit

3. The tariffs need to be guaranteed for a period of time (10 to 20 year contracts) that assures return on investment and the law itself should be in effect for as much as a decade or longer to create a more stable investment climate for renewables.  If some technologies no longer require this protection they can be phased out of the coverage of the tariff sooner than other technologies.

4. A tariff law that encompasses a wide variety of technologies helps balance the strengths and weaknesses of each generating technology. Including residential, community and wholesale generation technologies will help push renewable energy development on all fronts.

5. Tariffs should “degress”, go down in price, with each successive class-year of generators to encourage early action and increases in industry efficiency. A feed-in tariff system will become obsolete when costs are brought down and prices for fossil fueled generation inevitably rise.

6. A pooling mechanism for sharing costs of the tariffs should be instituted and spread across as wide rate base as possible. Within that rate base, costs need to be shared equitably.

7. Resolving physical or social barriers to energy development such as transmission or assessment of environmental impacts should be standardized, transparently negotiated with all stakeholders, and compressed in time given the urgency of increasing the proportion of renewably generated electricity in the generation mix.

8. Energy investment should be open to and remunerative for all types of investor through both cooperative and large corporate investment vehicles. In deregulated markets, barriers to utilities investing in generation directly need to be amended to allow utilities to profit from feed-in tariffs alongside other investors.

9. A financial system that recognizes the value of the tariff’s purchase agreement and loans money accordingly is key; sometimes public lending institutions can pioneer lending for early projects to demonstrate the viability of the system to private-sector banks.

If the above conditions are present or can be created, success with a feed-in tariff system is highly probable. If the groundswell in the US continues apace we may very well see successful feed-in laws on a local or national level within the next few years.

The events of December when the US Congress dropped an extension of the existing tax credits for renewable energy from the 2007 energy bill have highlighted the need for the renewable energy industry to take a different tack in the area of policy support and marketing strategy. The importance of support for renewable energy is key, as tax breaks have stimulated investment in wind, solar, and geothermal energy in the years that they have been in force, yet there is a dramatic fall-off in new project starts when the tax credits have elapsed in 2000, 2002, and 2004. The current tax credits may be revived but their spotty, on-again, off-again history points to a fundamental problem of a lack of consistent, dependable support for renewable energy in the US. The tax credits were fairly easy to cut because they are a relatively indirect subsidy, though the oil and gas industry with a much stronger lobby also have benefited from indirect (and direct) subsidies. The more indirect the subsidy, the more difficult it is to build public support for re-instating that subsidy and the more dependent on the informal power of lobbying. In the instance of the 2007 energy bill, the oil and gas companies won one more round, even though these large energy conglomerates have started to develop side-lines in renewable energy.

The “Cheap Energy Contract”, the society-wide social and political contract that is still in effect in the US and Canada, makes both overt and hidden subsidy a necessity. In the age when oil and natural gas was “easy” and geopolitical strains had not yet emerged around Middle Eastern oil reserves, subsidy to oil and gas companies may have been welcome to those companies but probably not necessary. Now, with skyrocketing global demand for energy, oil and gas subsidies reduce risk for Big Oil, allowing for record profits to continue to roll in while oil prices remain high but still not yet at politically unacceptable levels. Soon the guarantee of cheap energy may no longer be able to be sustained with oil and gas, if market forces push the price of these resources still higher. The Iraq war can be taken partially or in its entire financial and human cost as a failed attempt at an oil subsidy, as it is unlikely that the war would have been started if Iraq did not sit on top of some of the largest oil deposits.

Those who insist on a “free” totally unregulated and unsubsidized market in energy believe, but have never demonstrated, that energy would be less expensive without government intervention or aid. Of course, some government subsidies go directly to a private company’s bottom line but a) our economy is based largely on the profit motive so this would apply as well to the oil industry and b) the services or funds that government provides would cost these private firms a lot more on the private market and therefore would lead to still higher oil prices. The low price of fossil energy subsidizes our most important commodities including food; the recent hike in food prices is partly attributable to rises in energy costs. Presidents Bush and Reagan never seem to have allowed their championing of unregulated markets to interfere with oil subsidies.

Energy and Human Use

Fundamentally, for human beings, there are two types of energy: energy that people can eat and energy that people don’t or can’t eat. Analysts of the social aspects of energy distinguish between exosomatic and endosomatic energy: endosomatic energy is what people can eat while exosomatic energy is the energy that is used outside the human body, either by work animals or machines to achieve some desired end. (“Somatic” = relating to the human body; “endo”= inside; “exo”=outside).

We use the word “energy use” in modern societies to refer to exosomatic energy use. There is a pretty tight correlation between the level of economic development and the amount of exosomatic energy used: for instance, the richest country in the Western Hemisphere, the U.S., uses about 30 times more energy per capita than Haiti, the poorest country. While there are satiation mechanisms for endosomatic energy which most of us have from birth (we stop eating when we are full), we have no internal limit with regard to the use of exosomatic energy. This lack of an internal limit on the use of exosomatic energy has not become a major issue for us until we came to recognize in the last couple decades the relationship of fossil energy use with climate change.

As mentioned in the post in this series on the electric farm, exosomatic energy use enables a geometric increase in the power to do work that individuals can exert. In agriculture, the use of fossil-fueled tractors and harvesters, enables a single farm worker to support 40-50 people in the US with food when at most a single worker in agriculture might be able to feed just a few people on his or her muscle power alone. A driver of a massive off-road diesel dump truck like those used in mining can carry more ore in a day than perhaps a few thousand people could. The electronic tools of the Internet, fueled by numerous power plants, allow an individual to communicate simultaneously with thousands or even millions of others within a few minutes. As Tad Patzek has observed, excess exosomatic energy can turn any of us into an everyday superhero, which is for many of us, an attractive prospect.

The Low Valuation of Energy

If (exosomatic) energy, in combination with technologies that can convert that energy to useful work, turns us into superheroes, wouldn’t this be a highly valued product?

As it turns out, not so much, as being a “superhero” is part of the expectation of our working and home lives in developed countries. Furthermore it is usually the energy conversion technology that gets all the glory, the car, the train, the mobile phone, rather than the energy resource itself. Energy use is not the focus of the activities we do: we don’t say “oh goody! I’m using a whole bunch of energy now!” Something like 80% of exosomatic energy in the societies of the world comes from fossil sources. Cheap fossil energy subsidizes all other activities in advanced societies. We expect to be able to travel at many times walking speed and to do lots of work with little effort on our part. Furthermore, most crucially, the price and availability of the endosomatic energy that we need, food, is highly dependent on energy; so of necessity all non-agricultural economic activity is dependent on the low cost of energy.

Energy then is part of the “frame” of economic activity and even more than that the “frame” of the frame of economic activity (enables plentiful, affordable, and varied endosomatic food energy which frames all economic activity). Just as we don’t pay much attention to the frame of a picture, most of us don’t pay much attention to energy. As an example, at this moment I am not paying attention to the electricity being consumed by my computer but instead focusing on the words I am writing. I am also not hesitating to go back and revise or rewrite something (I don’t blog in stream of consciousness…sorry) for fear of using more energy, the attitude of most computer users. In contrast to electricity, petroleum prices in the US are now at levels where obliviousness to the cost of energy is no longer as common as it once was.

High Per Capita Energy Use and Social Inequality

One of the byproducts of the North American way of using and valuing energy is that the lifestyles of a majority of the population are highly dependent on cheap energy. People can live in larger houses with larger yards if they are able to travel longer distances for less money; they can also afford to heat and cool them using the relatively inefficient devices and methods in our current building stock. Long commutes are a burden of those residents of high cost urban areas with moderate means who wish to own homes. Rural life in widely dispersed farms and farm towns is viable and bearable because of very high levels of petroleum use and the readiness to travel hundreds of miles on a regular basis. In addition to work, what many of us do for fun and leisure often is highly dependent upon petroleum or cheap electricity (monster trucks, airplane flights, power boats, game consoles, computers, plasma TVs). Partial exceptions to this style of life can be found in the highly concentrated urban areas of the Eastern Seaboard, though immediately adjacent are suburban areas where high per capita energy use is typical. Furthermore cultural and real estate trends are now placing a higher value upon urban living, pushing the middle classes and poor out of the most vital urban areas to the suburban and exurban periphery, and more dependence upon cheap energy.

It is no wonder that energy pricing is politically sensitive though most policymakers favor moves that attempt to minimize energy costs over the short term rather than provide long-term solutions.

The Ethical Valuation of Energy post Carbon

In contrast to the low economic valuation of energy, the discovery of the negative externalities associated with fossil fuel use, i.e. carbon emissions and warming, have led to energy use becoming one of the key political and ethical issues of this new century. Now the avoidance of using fossil energy and the installation of renewable energy generators has developed a high moral valuation. Crudely stated, there is now “good” and “bad” energy use. While this valuation is subjective, it is very widely held and has inspired numerous pricing mechanisms that either tax fossil fuel use or increase the revenue accorded clean energy as a way to promote the expansion of renewables. Carbon trading markets have arisen as a means of instantiating and, with legal backing, enforcing this moral valuation in the arena of economic exchange.

The newness of the higher valuation of energy use, in the negative, has not yet led to cultural attitudes in the West that show a positive respect for energy use. We do not yet treat gasoline or electricity as precious, nor have we developed the analogue of cultural rituals that show respect for material and natural bounty that one finds in less industrialized cultures or in our own religious observances before eating food.

The Culture of Energy Efficiency and Energy Conservation

We have found at least a partial substitute for cultural rituals that re-value energy or high energy prices in the movement towards greater energy efficiency and energy conservation that has grown in fits and starts since the 1973 Oil Crisis. In the United States, California has been the standard bearer, with state policies since the late 1970’s that at least in the electricity and natural gas sectors have made energy efficiency a requirement and a revenue center for utilities.

While energy remains somewhat cheap, energy efficiency has again become a virtue as well as a way to save money as concern about global warming grows and carbon pricing is anticipated. Cultures with higher energy costs have already built some degree of energy efficiency into their building and transport systems, but the moral valuation of energy efficiency may lead to more aggressive, pre-emptive moves to cut energy costs.

Analysts usually distinguish energy efficiency that involves installing devices that do the same work using less energy, and energy conservation, which means altering end use activities to save energy. For a time, in the 1980’s and 1990’s in areas without binding laws or high energy prices, energy conservation fell out of favor, though now cultural re-valuation in the shadow of global warming has led to an “up-valuation” of energy conservation in our cultures. Large energy users are increasingly being paid to become involved in demand response programs in the overburdened electrical system where energy use is turned down in response to system demands or automatically via pricing signals. Energy conservation is an attempt to invent something analogous to a satiation mechanism for our use of exosomatic energy.

The Sustainability Criterion

In addition to carbon emissions, in the last couple decades sustainable use of energy resources has also emerged as a value. To use energy in way that doesn’t draw from exhaustible resources or endanger the livelihood of future generations is a new and fairly rigorous criterion. Renewable energy, of course, is supposed to satisfy this criterion, while nuclear energy does not.

Energy: Commodity or Segmented Market?

Until the emergence of concern about carbon emissions and sustainability, energy has been viewed as a commodity, i.e. a good of low, uniform value affordable by most consumers. The opposite of a commodity market is a segmented market, which can contain commodity products at the low end, branded mass produced products, and customized products and one-offs, some of them handmade. The latter types of products can sometimes be “premium” products that can command larger sums for their greater quality or functionality. The uniformity of energy products has additional usefulness in that it adds value to end use devices that can be used across a broader range of situations. Electricity and crude oil have been treated as commodities though refined petroleum products allow some limited differentiation and branding. Now, there is an emerging trend towards a segmented market, as energy is being divided into “clean” and “dirty”, “sustainable” and “unsustainable” energies.

As this series focuses on electricity, the new differentiation among types of energy refers to differences between electric generators and not between energy carriers: we are still dealing with electricity of a particular voltage, frequency, etc that drives the same machinery for the end users/buyers. While historically pricing and valuation of electricity did not include consideration of sustainability or environmental impacts, we are rapidly working on ways where these impacts are put into the value equation.

If one generates electricity using a sustainable, clean method, does one then have a premium product or simply an expensive means of generating the same commodity? By avoiding negative externalities in the present (carbon emissions) and creating a sustainable technology (benefit to future generations), while generating electricity, greater social benefit is created. By creating a premium product out of this type of generation, a portion of this greater benefit can be recognized by and compensated for in a higher price.

There are currently two methods of segmenting the electricity market in favor of renewables as premium products, one focused on the retail end and the other on the wholesale end. On the retail end, Green Power Marketing is a largely voluntary system that creates a parallel market to the conventional market for electricity. Each MWh of cleanly generated electricity is issued a Renewable Energy Certificate or REC, which can be traded and sold to those who want to support or are required to support renewable power generation. Renewable Portfolio Standards for utilities create a market for RECs, as do carbon offset programs and voluntary Green Power purchases by ethically motivated individuals and organizations. REC markets and RPS policies are the renewable energy programs found in most of the United States, some European countries.

Segmenting the wholesale markets, some countries and regions have implemented feed-in tariffs that set a menu of premium wholesale rates for renewable energy generators, that allow for recovery of costs plus a reasonable profit. Feed-in tariffs are tailored to specific technologies and are meant to allow renewable technology companies to gain economies of scale by stimulating market demand for their technologies. Feed-in tariffs mix in with existing electric rates, leading to increases of a few percent a year in the total cost of electricity. Implemented most successfully in Germany and Spain, feed in tariffs have been the most decisive instruments to spur the increase of renewable electric generation as they are simple and reduce finance costs and project risk. Feed in tariff laws are now being considered in Michigan, Minnesota, and California, which already has a very limited feed in law on the books.

Future of Valuing and Pricing Energy

If we are serious about reducing greenhouse gas emissions and developing a sustainable energy system, we will need to both increase our energy efficiency by a large factor and also switch over from fossil to renewable generators at a fairly rapid pace. Placing a higher value on energy, either planfully or forced by necessity when fossil fuel prices rise, is the most likely route to building a clean energy system for ourselves and future generations. A segmentation, either at the retail or the wholesale end (or both) will help drive economic actors towards making the investments and purchasing decisions that favor cleaner, more sustainable energy over the fossil energy that is still the norm. This “New Energy Contract” is yet to be written but it will be no doubt a topic of discussion for years and decades to come.

I’ve generally applauded or appreciated Google’s initiatives in the area of climate and energy. Among large technology firms, Google has seemed to have gotten the basic outlines of the future renewable electron economy. For one, they embraced carbon neutrality pretty early in the game. For two, they have located at least one of their server facilities so as to take advantage of clean hydro and purchased one of the larger photovoltaic arrays in the world for their Mountain View HQ. Thirdly, they’ve assembled some, what from all reports are, pretty energy efficient “blade” servers for internal use and have been leaders in the Climate Savers Computing Initiative. Fourthly, they have been supportive of electric drive transportation, in particular plug in hybrids. Furthermore Larry and Sergey have put their own money into some of the Valley’s more promising energy plays, including Nanosolar and Tesla Motors.

However, when Google announced RE<C in late November, the clean energy industry and climate policy community was delivered something akin to the Apple of Discord or Pandora’s Box, a tempting, shiny but divisive and potentially destructive gift (in fact the German word for poison is “Gift”…coincidence? I think not!). While Google had received almost universal applause for its previous initiatives, here was a still splashier and more ambitious clean energy/climate project that leaves a slightly bitter taste in the mouths of many of Google’s current and would-be allies.

To those who are not aware of RE<C, I can give you a short, perhaps biased summary of its intent but you can find the official version at the Google.org website. RE<C means “renewable energy cheaper than (less than) coal”. The intention of RE<C is to make renewable energy so cheap that everybody in the world can afford it, thereby out-competing climate-altering coal on price. Cheaper than coal means from one to three cents per kilowatt-hour, which is compared to the price of energy from old, “paid-for” rather than new coal plants. The timeframe for this transformative vision is a period of years rather than decades. Google has already invested $20 million dollars in RE<C, $10 million each to the solar thermal electric start-up eSolar, an Idealab company and Makani Power, Inc, a high-altitude kite-based wind turbine company. In addition to these technologies, Google has expressed an interest in Enhanced Geothermal Systems technology, a way to scale up geothermal from specialized hot spots to almost every location. RE<C is an initiative that is housed in Google’s venture philanthropy, Google.org, which is led by Larry Brilliant, the medical doctor who among other things, helped in the effort to eradicate smallpox.

Replace Coal?

One of the ambiguities of the RE<C announcement is whether the new Google renewable power plant will function as a coal replacement. Coal-fired power plants take a while to start and stop and they are cheap to run so they are used for always-on baseload power that operates day and night. Sometimes pulverized coal plants are used to follow the load, meaning gradually increasing and decreasing power output to meet the daily rise in power demand. RE<C is to produce one gigawatt of power generating capacity at a price cheaper than coal yet it is not clear whether this will be an “always-on” solution that replaces the functions of typical coal plants. One of the challenges for most renewable energies has been the lack of controllability and variations in the strength and availability in the