Projecting the future of greenhouse gas emissions
With the U.S. federal government finally enacting a major plan to stimulate decarbonization of the energy economy, news analysis turns to the practical issues of transitioning from fossil fuels. Some of us have been focusing on these practical issues for a long time. Our economies and households are addicted to fossil fuels. It takes a generation to break free from this addiction: it’s a matter of decades, not days, weeks, months or even years. The process started before last week’s “anti-inflation” bill and will continue with or without the bill. But now, an action by the government of the world’s largest economy has accelerated the process.
A typical report of skepticism about the federal climate bill is by Katherine Blunt and Phred Dvorak in Wall Street Journal, They observed:
“This Landmark climate bill Passed by Congress on Friday, it aims to reduce carbon emissions through subsidies to speed up the construction of renewable energy projects. Success in meeting its emissions targets will depend on how quickly the expansion occurs. Despite the new financial support for renewable technologies, the industry faces supply chain disruptions, impasse over project approvals and the challenges of building new high-voltage power lines and large batteries to support the unprecedented construction of wind and solar farms. ”
The article’s assumption is that technology will stagnate and large-scale renewable energy projects will depend on the grid and foreign manufacturing. Maybe, but that $370 billion has to be added to the trillion-dollar infrastructure bill and the federal government’s shift to green procurement and operations. These are powerful incentives that will spur technological innovation and the use of eminent domain by local governments. In addition, large-scale projects may be replaced by consumer products that enable households to decarbonize and partially or fully disconnect from the grid.
We should assume that renewable energy technologies will advance in the coming decades, just as communications and computing have advanced over the past half century. What if solar cells became smaller, more efficient and integrated into ordinary windows? What if a solar panel cost $500 instead of $15,000 and included replacing a few windows in your home? What if the battery was no longer the size of a big-screen TV but a laptop? What if they cost $300 instead of $3,000? A mainframe computer the size of a suburban living room used to cost millions and had less computing power than a smartphone. A generation ago, we watched movies on videotape and cable. Renewable energy technologies are now being developed by some of the brightest minds on the planet. Who knows what they’ll come up with?
On the supply chain side, President Biden recently signed into law the bipartisan Chip Act, which reportedly, New York Times‘Sheila Ovid:
“The United States has authorized $280 billion in taxpayer dollars to subsidize wealthy computer chip companies and invest in technological research to keep America strong and innovative.President Biden on Tuesday sign The law, officially known as the CHIPS and Science Act of 2022, calls it an “investment in America itself.” If the law, as many proponents of the government and private industry hope, would give the United States more control over the future of basic computer chips, and a hedge if China becomes more hostile to its ally Taiwan . The law also aims to keep the United States at the forefront of technology by providing more government support for research. “
As China subsidizes its high-tech companies, these federal funds will level the playing field and return some manufacturing to the United States as automation advances. Supply chains are fast becoming supply networks as companies learn to navigate the turbulence of the global economy. In conclusion, predicting the precise pace of decarbonization is impossible due to the rapidly changing and highly dynamic organizational and technological environment.
This will take time and will require partnerships between the public and private sectors, but the main venue for decarbonization activities will be in the private sector. This is because energy, while regulated and intertwined with many rules and subsidies, is privately owned in most parts of the world. While climate activists support the “Lower Inflation” bill as the best climate bill they can get in the current political climate, they don’t think the new federal effort is enough. Lisa Friedman and Coral Davenport in New York Times August 12th and wrote:
“For lawmakers in their seventies who wrote the historic climate bill Congress passed Friday, and for the 79-year-old president who is about to sign it into law, the measure represents a ‘once in a generation’ victory. But the young Democrats and climate activists are hungry for more. They see the bill as a down payment, and they worry that complacent voters will believe Washington has finally solved climate change — when in fact scientists warn it has only taken the first necessary steps. Varshini Prakash, 29, said: “This bill is not something my generation deserves and needs to avoid climate catastrophe completely, but it is something we can pass given the powers we currently have. “The Sunrise Movement, a youth-led climate activist group.”
While I would also prefer a larger federal effort, my preference is based on an analysis of the risks posed by climate change compared to the risks of over-subsidizing the private sector. I think we need to create an atmosphere of certainty for the green economy to take advantage of the huge and growing momentum that already exists in renewable energy. These funds, and the policy impetus they represent, reinforce established trends and inspire confidence in the transition to renewable energy. $370 billion is real money that cannot be ignored. But governments and public policy will never be able to achieve an economy based on renewable resources—and that action will take place in the private sector. The bill may be enough to spur needed private action. If not, more can be added later.
Our dependence on energy will not be cured by the government. Given the choice between fossil fuel-based energy and no energy, we will all use fossil fuels. Fossil fuel interests know this and do their best to force us to consider this trade-off. They’re not the only businesses adept at manipulating consumers. Tobacco interests have long been perfected by taking advantage of consumer addiction. Although the science on the harms of smoking has been established for more than half a century, there are 1 billion smokers in the world and 7 million people died from the addiction last year. Therefore, I would not underestimate the potential for future harm from the fossil fuel industry. It’s a shame because if they redefine themselves as an energy company and provide renewable energy, they can avoid bankruptcy. Unlike smoking, which is far from necessary, our economy and way of life depend on energy. GDP is mostly no In the energy business, but almost all businesses rely on energy. Therefore, the economic power of Google, Apple, Amazon and Microsoft must be mobilized to achieve the goal of cheaper, more predictable, more reliable and cleaner energy. Let them go toe-to-toe with ExxonMobil. The U.S. government is only a small part of the overall picture here, so let’s understand that a problem as huge as climate change requires more than U.S. government policy and funding to solve. Our government must lead, but even if our economy is completely free of greenhouse gases, other countries must decarbonize.
No one really knows how to maintain our economic well-being while transitioning to a new energy system. Pretending that anyone knows how to do this is arrogant and stupid. Reminds me of a meeting I attended at the EPA in December 1980 shortly after the Superfund was enacted. There were people at the conference talking about how great it is that we have so much money now that we can clean up toxic waste sites in America. An engineer spoke up and mentioned that we don’t really know how to clean up the contaminated site, we’re not sure about the cost of the site cleanup, we need to figure out when to stop cleaning and think about getting the job done. And then someone said, “Yes: how clean is clean?” Many of us didn’t think about it until that moment. Greenhouse gas pollution is technically simpler than toxic waste, but economically harder to deal with. Modeling and predicting the impact of public policy on the rate of pollution reduction requires analysts to make numerous assumptions about the rate of economic, technological and behavioral change. We should be skeptical of these predictions and be humble about our ability to predict the future of greenhouse gas pollution on Earth.
Humility doesn’t seem to invade the mind-set of experts Lisa Friedman and Coral DavenportA report on the response to the climate bill. According to their work:
“…Scientists say the U.S. needs to do more. It must stop adding carbon dioxide to the atmosphere by 2050, and this bill cannot deliver… [emphasis added] To achieve his 2030 goals [of 50% emission cuts], Mr Biden will still have to impose new rules on emissions from power plants, vehicle tailpipes and methane leaks from oil and gas wells. State and local governments will have to set new standards to force the rapid adoption of electric vehicles, wind and solar power, and energy-efficient buildings to make up the last percent. “
Maybe, but maybe not. I’m always amazed at the confidence and certainty expressed by some climate “experts”. Need to understand the scale and uncertainty of the problem and possible solutions. So should the role of public policy itself. Public policy is irrational, it doesn’t work like the scientific method. It is incremental: remedial, continuous and partial. It won’t fix the problems, but it will make them less bad. The Clean Air Act of 1970 makes America’s air cleaner today than it was when it was passed. Air pollution isn’t as bad, but it’s not going away. The climate problem will never be solved, but I believe humans will make it less bad and protect the planet for future generations. I don’t know if we’ll get there by 2050. My beliefs are based on optimism and history, but this is not a prediction and I could be dead wrong.
