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There has been progress de-carbonizing electricity due to declining wind and solar power costs. However, de-carbonization of industry, transport, agriculture and buildings, the sectors which consume over 2/3 of fossil fuels, has been minimal given the technical, physical and practical challenges in the way. To assert that the US can reach zero net emissions by 2030, as the Green New Deal does, and for the entire energy sector (not just from electricity generation), and while phasing out nuclear power and relying heavily on carbon sequestration by forests1, sets a goal that cannot in our view be achieved. We agree with our science advisor Vaclav Smil that Green New Deal goals are not in the realm of the possible, that they do not appear grounded in existing scholarship on energy de-carbonization, and that they are not a useful foundation for a serious policy discussion.
Some on the right are accused of being “intellectually bankrupt” on climate issues, and I do see evidence of that. But being intellectually dishonest about the viability of the Green New Deal does no one any favors either2. At best, it’s a slogan to galvanize support for change; at worst, it’s a sign of how little work its proponents have done. This year’s paper gets into the details of where energy comes from, how it’s used, and the de-carbonization challenges facing the world’s industrialized and emerging economies.
Why the Green New Deal’s 2030 goal is unattainable
Consider the International Energy Agency’s “Sustainable Development” scenario for the US (blue dotted line), in which:
In this highly transformational scenario, which would require a Herculean effort to accomplish, US CO2 net emissions decline by 40% by 2030, and not to zero as imagined by the Green New Deal
Mountains and Molehills: Achievements and Distractions on the Road to De-Carbonization
Impressive global wind and solar milestones have been reached in the last few years: declining upfront capital costs, electricity auction prices comparable to natural gas, rising capacity factors and capacity additions which have exceeded coal and natural gas for the 5th year in a row. These trends, shown on page 6, are the by-product of scale, innovation and plenty of subsidies.
Here’s the “but”: electricity is less than 20% of global energy consumption. Unless progress is made reducing direct fossil fuel use by industry and transport, de-carbonization goals might not be met in the timeframes often cited. Let’s take a closer look.
The first chart shows primary energy used to generate electricity on a global basis, measured in “quads” (quadrillion BTUs). In 2017, the renewable share reached 25%. Hydroelectric power accounted for 16%, and wind and solar combined accounted for 5%, up from 0.5% in 2004.
The second chart shows how electricity gets generated: 225 quads of primary energy are required to generate 75 quads of electricity. Where did the rest go? 150 quads are lost to thermal conversion3, power plant consumption and transmission.
While these statistics are global, electricity shares of total energy use and fossil fuel shares are similar in the US, China and Europe4. Hence the challenges Germany faces as it aims for a 40% decline in emissions by 2030, and challenges the US faces with any plan that aims for zero net emissions by the same year.
Where does that leave us? With hard-to-reach de-carbonization targets, for two main reasons:
Hard to reach de-carbonization targets argue in our view for significant funds spent on flood prevention/ remediation projects, which we discussed in detail last year (see links below).
With this backdrop, we look this year at “Mountains vs Molehills”: what could provide substantial pathways for de-carbonization, and what might end up being distractions along the way. While renewable penetration of the grid will continue to rise, the charts on page 3 cast considerable doubt on the viability of German (Energiewende) and US “Green New Deal” de-carbonization timetables, particularly if nuclear power is not considered a permanent part of the solution.
Table of Contents
Click here to read the full document, or select a link below to read a specific section.
Renewable energy milestones
Comments from our technical advisor Vaclav Smil
Links to select topics from prior Eye on the Market energy editions
Executive Summary supplementary materials: renewable energy milestones
Why all the focus on de-carbonization?
I asked Vaclav to articulate for our clients why de-carbonization is so important. His response is useful for those who are convinced by consensus views on climate science, and for those still on the fence:
“Underlying all of the recent moves toward renewable energy is the conviction that such a transition should be accelerated in order to avoid some of the worst consequences of rapid anthropogenic global warming. Combustion of fossil fuels is the single largest contributor to man-made emissions of CO2 which, in turn, is the most important greenhouse gas released by human activities. While our computer models are not good enough to offer reliable predictions of many possible environmental, health, economic and political effects of global warming by 2050 (and even less so by 2100), we know that energy transitions are inherently protracted affairs and hence, acting as risk minimizers, we should proceed with the de-carbonization of our overwhelmingly carbon-based electricity supply – but we must also appraise the real costs of this shift. This report is a small contribution toward that goal.”
Acknowledgements: our technical advisor Vaclav Smil
As always, our energy Eye on the Market was overseen by Vaclav Smil, Distinguished Professor Emeritus in the Faculty of Environment at the University of Manitoba and a Fellow of the Royal Society of Canada. His inter-disciplinary research includes studies of energy systems (resources, conversions, and impacts), environmental change (particularly global biogeochemical cycles), and the history of technical advances and interactions among energy, environment, food, economy, and population. He is the author of more than 40 books (the latest one, Growth, will be published by the MIT Press in September) and more than 400 papers on these subjects and has lectured widely in North America, Europe, and Asia. In 2010, Foreign Policy magazine listed him among the 100 most influential global thinkers. In 2015, he received the OPEC award for research, and is described by Bill Gates as his favorite author.
Acronyms used in this paper
AC alternating current; BTU British thermal unit; BTX benzene/toluene/xylene; CCS carbon capture and storage; CO2 carbon dioxide; DC direct current; EIA Energy Information Agency; EPA Environmental Protection Agency; ERCOT Electric Reliability Council of Texas; EV electric vehicle; GHG greenhouse gas emissions; GW gigawatt; GWh gigawatt-hour; IEA International Energy Agency; IPCC Intergovernmental Panel on Climate Change; IRENA International Renewable Energy Agency; ISO independent system operator; kg kilogram; km kilometer; kW kilowatt; kWh kilowatt-hour; L liter; MJ megajoule; MMT million metric tons; Mt metric tonnes; Mtoe million tons of oil equivalent; MW megawatt; MWh megawatt-hour; NREL National Renewable Energy Lab; TWh terawatt hour; VAT value added tax; Wh watt-hour
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