Sunday, March 25, 2007

Another Donlan Miss (over at Barrons)

Here is the text of my recent letter-to-the-editor at Barron's [subscription/registration required] countering Mr Thomas G. Donlan's editorial 3/26/07 "A Plea for the Planet's People".

Donlan should crawl back under his fossil fuel soaked rock. Donlan believes that a climate crisis is no more than an academic possibility, given current trends rather than a near certain reality. He posits that “a moralist still would have to compare the cost of the solutions with the benefits, and understand the costs and benefits of doing nothing as well.” The rest of the world, minus a few oil executives and possibly some Detroit car makers, has decided that action needs to be taken to prevent a global climate crisis. The question that remains is what actions to take and when. Gore offered some interesting possibilities in his testimony before congress.

Donlan further believes we have to make a false choice between fixing the planet or growing the economy. As if the economy will continue to grow if the planet falls apart. The problem that exists today is that our fossil fuel based economy only counts the benefits of fossil fuels and none of the costs (aside from the purely economic cost of extraction). Much as an economy based on slave labor cannot be considered a true economy, since obvious economic costs related to labor inputs are not counted, so an economy that ignores the environmental cost of burning its (diminishing) fossil fuel resources is similarly a false economy. What is particularly pernicious in this case is that there are many (environmentally sound) energy alternatives that will become economically viable, once we count the environmental costs of fossil fuels. We are in effect massively subsidizing the fossil fuel sources and then complaining that so long as we ignore the subsidy, no other source is economically viable. Some leadership is required to change our national (and global) economic accounting standards to reflect the reality of global warming. I don’t dispute that questions about how fast changes must be implemented to avert what level of climate risk exist…but certainty will only arrive after the fact in cases such as this.

“Would it be more immoral to allow millions of people living on the river deltas from Louisiana to Bangladesh to be flooded out, or to hold back the industrial development of Asia and Africa and condemn other billions to lives of great poverty?”

As if we can only, or ought only, to do one or the other…obviously we must work to save both groups. What Donlan cannot see because he believes that “wind and solar…aren’t up to it”, is that these very distributed energy technologies (along with other alternatives being developed—geothermal, wave power etc) will allow these developing countries to leapfrog our fossil fuel energy based economy. In nearly every field of human endeavor Donlan believes in the power of private enterprise and creativity to produce value by increasing efficiency…every field except energy apparently.

Sunday, March 11, 2007

Dragging our feet/Shooting our foot

Many in the US argue that we shouldn’t take action (such as cap and trade or a carbon tax) to reduce our greenhouse gas emissions unless China (and other developing countries) are compelled to do the same. This is both wrongheaded and shortsighted. Wrongheaded because global warming is primary of our making (we = developed countries) and we should be responsible for the effects (or the very least mitigating the effects) of our pollution. Shortsighted because now is the perfect time to be investing and inventing in alternative energy, which is (collectively) the energy source for the next century. I don’t know anyone (except US government statisticians over at the EIA) who thinks that in 30 years there will be enough oil produced for us to continue with BAU (business as ususal). If we as a country commit to taking a leadership role in reducing greenhouse gases and developing the technology to do so, we will be well placed to reap the economic benefit as other countries invest in cleaner energy sources. On the other hand if we continue to drag our feet other countries will achieve a position of technological dominance that leaves America struggling to compete. This has happened in so many industries already, electronics, computer hardware, cell phones…etcetera.

To use the example of solar cells this might be happening again. According to a publication of the Prometheus Institute, the increase in Chinese solar cell production last year was more than the total cell production of the US. In 2006 the US produced 200MW of solar cells out of a 2.5GW global market (~8%). As recently as the year 2000 we produced 75MW of solar cells out of a 275MW global market (~27%). Talk about losing market share! Heck Taiwan alone produces 89% as many solar cells as the US. China is almost exclusively exporting cells to Europe, but then that is where half of our production goes too.

The good news is that we installed over 100MW of solar in the US last year, about twice what was installed in 2004 and four times what was installed in 2002.