Energy Transitions

At present the world is in need to propagate a more rapid energy transition than has ever been accomplished. [1] The world’s energy providers are currently battling to retain their historical market share in the business of energy production. This battle continues to heat up as market volatility has been higher since “The Great Recession” and energy production is perceived as a low risk industry. Utility companies are equally entrenched with shareholder motivations tied to their low risk, guaranteed returns. Yet despite the perception of low risk, and the industry’s conservative approach to change, if we are to preserve our society from the ravage of climate change we have no choice but to retool our energy infrastructure to a more sustainable framework.

On the progress of this initiative we have barely grazed the surface. At this point fossil fuel companies retain immense power and influence over the political system. Through the Supreme Court decision, Citizen’s United, the political system has developed greater vulnerability to corporate profit interests. “The dissenters said that allowing corporate money to flood the political marketplace would corrupt democracy.” [2] Fossil fuel entrenchment extends well beyond the political structure into the very fabric of society. Established western infrastructure including roads, bridges, and housing has resulted in the development of businesses, industry and personal behaviours that all depend upon and insist on the continuance of that same infrastructure. I refer to this simply with the term inertia, as it applies to human behaviours as well as the culture at large. Cultural and behavioural inertia are the largest factors entrenching the demand for fossil fuel consumption and acceptance. Looking at the top revenue organizations in the world evidences not only the political influence, but also the motivation of the fossil fuel industry to maintain this cultural status quo. The top 10 revenue organizations in the world are federal governments, but fossil fuel companies dominate the ranks of 11 through 20.





Given that such revenue and power is retained in these organizations, it is clear that much transition work is still needed.

The renewable power industry is aggressively pursuing avenues of research to make these power sources more efficient and in general more cost-competitive. Unfortunately, a great deal of American resources has been squabbled on impractical or even damaging energy prospects such as corn ethanol. By consuming a vast spectrum of resources including human, innovation, political, and financial the ethanol industry has limited momentum for real change in the energy industry. This damage is tied to the perpetuation of the myth that high per capita consumption suburban lifestyles are sustainable. The suburban lifestyle has been subjected to a massive escalation of commitment – and is inextricably linked the sunk cost fallacy (i.e., the concept that past expenditures should weigh heavily in future decision-making). Blumer states, “Evidence that the psychological justification for this behavior is predicated on the desire not to appear wasteful”[3]. It is ironic that those practicing suburban lifestyles will perpetuate their lifestyles in an effort to not be wasteful. In the act of attempting to not be wasteful they are actually supporting the fossil fuel and ethanol industries, both of which are not sustainable and very wasteful. The suburbanites’ behaviours are then entrenched in defending the status quo, as variance from consistency would equate to a personal lack of consistency in their behaviour. “Automatic consistency offers a shortcut through the complexities of life’s many decisions, but it can lead to unintended consequences and behaviours not in our best interest. Automatic consistency can be a defense against unwanted dilemmas, or disturbing emotional reactions such as guilt and shame, and safeguards against deeper thought.” [4]

Another part of the damage is in the perpetuation of the myth that bio-fuels or any low Energy Return on Investment (EROI) energy source offers any value to the economy. Bio-fuels have been likened to renewable power sources such as solar and wind power but offer none of the same benefits to a sustainable society. Ethanol has artificially boosted GDP while creating almost nothing; this is evidenced by its abysmal EROI. Many figures and reports have been written on corn ethanol’s EROI varying from a range of 0.8:1 to 1.5:1 [5]. The ethanol industry contributed 13.3 Billion gallons of ethanol in 2013, blended in to traditional gasoline sales to meet the 10% blend requirement [6]. The average cost of a gallon of gas in 2013 was 3.57. This reflects 47 billion dollars of annual economic activity that effectively cost approximately 47 billion dollars to generate. If the 0.8:1 EROI is indeed accurate, then corn ethanol did the equivalent of destroying 12 billion dollars of economic value. Indeed, ethanol’s EROI and related impacts are far worse than the Canadian Tar Sands, with an EROI between 2.5:1 to 7:1. [7]

In the scope of transitioning away from fuel power to more efficient energy consumption and distribution methods, I utilize a base case scenario on which to define or differentiate one’s arguments. Shell has created two “futurist scenarios” that describe where the world is going with respect to energy futures and the retooling of energy systems. The two scenarios are titled “scramble” and “blueprints”[8]. The primary differentiating factor is the pace of continuous improvement action addressing climate change. In “Scramble,” events outpace actions with the result of damaging climate events occurring and perpetually needing response. This is largely resultant from another decade of political division, squabbling and weak action to mitigate climate change. In “Blueprints,” actions outpace events, significant damage as a result of climate change will still occur, but the damage is less than that of the scramble scenario. In the Blueprints scenario, a massive grassroots effort occurs that undermines political division and opens the doors for policy action to make a difference. Since action is taken quickly pushing renewable technology to accelerate, more financial resources are consumed in the short term, and more mistakes are made in the process of finding technologies that will meet the goal of rapid decarbonization of the economy. As the world seeks to find solutions and strategies that are both effective and scalable, the Blueprints scenario limits the effects of climate change. I therefore agree with Shell, that the Blueprints scenario is the better action to take – pushing for rapid continuous improvement – but this scenario is not without cost.

To be successful with this energy transition by 2050 will require vast action networks to be developed in cities around the world. I say 2050 as a goal because many disciplines have converged on this target. For example, accounting firm Price Waterhouse Coopers (PWC) has stated that the world must maintain a 5.1% decarbonization rate in order to meet the world goal of limiting climate change to 2 degrees [9]. Regarding this 5.1% rate of decarbonization, the author states, “We have passed a critical threshold – not once since 1950 has the world achieved that rate of decarbonization in a single year, but the task now confronting us is to achieve it for 39 consecutive years.” [9] It is clear that this task seems insurmountable, and while I have realistic doubts about human capacity to accomplish this task, I have no choice but to hope that we can do so, and to do everything within my power to aid in these efforts.

When defining the steps that will be required to get us there, it bears merit to look at the very lowest level. A number of political analysts have taken notice that not only are politicians largely divided, but more importantly so, this is just reflective of division amongst the people whom those politicians are representing. An article published in “The Atlantic” discusses the growing polarization between blue cities and red rural areas [10]. Citizen-action networks must be developed mobilizing massive grassroots support for climate mitigation causes. The mobilization of volunteer-generated action has the ability to erode support for climate opponents, while making tangible changes today. In addition, the organizing of common people into a volunteer network results in the empowering of all contacts in the network. This empowerment will be characterized by improved awareness of the types of important action, how to accomplish these tasks, improved motivations, and in general an informed coalition of climate-concerned citizens.

Given the entrenchment of fossil fuels into our society and the speed in which the economy must be decarbonized there exists many outcomes as a result of a successful transition. First and foremost is a society whose purpose and culture has shifted its “American Dream” away from the concept of consumerism and ownership of a house with a white picket fence to a new paradigm. Replacing one mainstream societal objective with another will mean we have reshaped our society to be future-focused, and places the sustainable welfare of our community’s children ahead of the isolated protection of just one’s own children. This new goal is one of resiliency and commitment to community. This is the culture surrounding a world that has undergone a rapid shift to new energy sources.

On the negative spectrum will be what it costs us. First and foremost, this transition will be characterized by financial sacrifice. Public transportation will exceed individualized transportation – and the suburbs will have fallen into obscurity as society rejects the rampant rate of consumption that supports such a lifestyle. As a result population densities rapidly increase in cities throughout the world. This in turn places a continually growing burden on cities to provide livable systems – a difficult challenge from both a finance perspective as well as threshold for management and decision-making if the funding is there. With the understanding of this need urban renewal and adjustment is an essential parameter to energy transition.



Citations:

[1] Vaclav Smil, Energy Transitions (Santa Barbara, Calif.: Praeger, 2010)

[2]http://www.nytimes.com/2010/01/22/us/politics/22scotus.html?pagewanted=all&_r=0

[3] http://www.sciencedirect.com/science/article/pii/0749597885900494

[4] https://sites.google.com/site/724ecialdiniwiki/home/commitment-and-consistency

[5] http://www2.buildinggreen.com/blogs/producing-ethanol-corn-bad-idea

[6] http://www.ethanolrfa.org/pages/statistics

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