Tag Archives: CO2

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Book Review | Merchants of Doubt

Selling Lies, Sowing Chaos

The woeful history of the doubt industry

In their sweeping and comprehensive new book Merchants of Doubt: How a Handful of Scientists Obscured the Truth on Issues from Tobacco Smoke to Global Warming, historians Naomi Oreskes and Erik M. Conway document how a handful of right-wing ideologues — all scientists — have (mis)shaped U.S. policy for decades, delaying government action on life-and-death issues from cigarettes and second-hand smoke, to acid rain, and now, finally, to climate change. The book is similar to the popular Discovery Channel show “How Do They Do It?” Only instead of investigating quirky mysteries like how stripes get into toothpaste, Merchants of Doubt looks at exactly how we arrived at the gravest crisis in the history of our species — one we created ourselves…

Book review continued at Grist.

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Free Markets, Energy Policy & The Easter Bunny

President Bush & Economic Adviser

Spoiler alert: Due to the sensitive nature of the following information, if there are small children or economists in the room you may wish to go here or here until privacy can be assured.

Laissez-Unfaire

I’ve taken part in some discussions lately — and read many more — in which advocates of different energy sources claim that the invisible hand of the Free Market will “pick” the perfect mix for our energy portfolio. Not that this is a new argument. Laissez-faire capitalism was popularized in the 18th Century, i.e. long before Milton Friedman. What’s new is the context: a seismic shift to a “clean energy economy.” The irony, of course, is that this epic shift is required, and fast, because of the worst Free Market disaster in economic history: global climate change caused by the market’s failure to reflect the environmental costs of burning fossil fuels.

Click to download document (pdf)

This limitation was addressed in a 1994 report by the Office of Technology Assessment, “Studies of the Environmental Costs of Electricity.” Here’s one key section from the document:

Environmental cost studies often focus on what appears to be the “bottom line” — the monetary value of environmental effects. In many cases, this is the most speculative and controversial aspect of the study, and effects that are not monetized are often ignored. In contrast, focusing on the earlier components of the study (e.g., the emissions and impacts stages) would emphasize aspects that are most amenable to scientific and technical resolution.

Monetization is useful, but its very nature allows the results of environmental cost studies to be reported in a highly aggregated form. This encourages use of the results without the full understanding of the assumptions and values that underlie them. Placing greater emphasis on reporting the results of earlier phases of the analysis (e.g., emissions and impacts assessments), and on clearly explaining the assumptions and values that underlie the estimates of monetary damages, would greatly assist the federal decision makers who may use the studies.

Cap and Regulate

So, how do we solve this self-imposed dilemma? The idea du jour is to tinker with the market to internalize the costs through cap-and-trade or cap-and-dividend or some other variation on the theme. I think advocates are half right. The “cap” side of the equation has to do with science and regulatory policy, both of which should play a far more muscular role than they have.

It’s the “trade” or “dividend” part that worries me, because that route is far more prone to corruption and manipulation. I think the benefits of the free market (without caps) would work best if we start from a position of pragmatism not ideology: regulating energy sources the way we already regulate most other environmental pollution, by setting strict emission levels.

We should continue to get better at internalizing the true costs of energy production. But we need to recognize the limitations of that tool. Which is where I part ways with the ideologues for whom the Free Market is a god to be worshiped rather than an economic arrangement that is valuable but fallible.

In other words: the Free Market is as real as the Easter Bunny — only not as cute.

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DOE Loans for Clean (maybe), Renewable (or not) Energy

From the Department of Energy, some good news and some bad news for renewable energy advocates.

First, the good news: The DOE released a list today of the dozen projects currently participating in the Department’s energy loan programs. The loans and guarantees total more $19 billion and will “create or save” 50,000 jobs, according to DOE figures. So, what could be bad about that? Nothing, unless you look carefully at the details. (Not that the DOE is trying to mislead anyone — it’s a matter of definitions.)

The Devil is in the Definitions

The Arizona state legislature recently tried to pass a bill that would have defined nuclear power as a “renewable” source of energy, despite federal regulations to the contrary. (I’ve written about the details elsewhere.) No such purposeful dis-information is contained in the information coming from Secretary of Energy Steven Chu’s office. It’s just that Chu, like his boss, defines “clean energy” very narrowly — referring only to sources that emit little or no-CO2.

Shippingport Atomic Power Station

This definition excludes the 2,200 tons of radioactive waste produced annually by the nation’s 104 nuclear power plants. A half century after the first commercial nuclear power plant went on-line (the Shippingport Atomic Power Station in Pennsylvania), there is still no long-term solution for what to do with this dangerous waste.

Still, even the enthusiastically pro-nuclear Secretary of Energy doesn’t claim nuclear is “renewable” since it runs on a fuel supply (uranium) that has to be mined and is finite.

Of the dozen loan recipients, nine are clearly renewable. One (Ford) is a combo — the loan goes “to transform factories…to produce more fuel efficient models,” according to the DOE (pdf file). The increased efficiency comes from a variety of changes, including adding electric vehicles (which can be “renewable” depending on the energy source) and design changes that allow more complete energy capture from combustion — which is a good thing, but doesn’t make it “renewable.”

In addition to the two nuclear power plants (operated by Southern Nuclear), one other project is clearly not renewable — or clean: the construction of a plant in Louisiana to produce activated carbon), used to remove mercury emissions from coal-fired power plants. Reducing mercury pollution is clearly a good thing. The coal industry also needs this technology because new, lower mercury emission standards are going into effect. But, is a project “clean” if it allows coal-fired power plants to continue emitting CO2? The DOE’s definition of “clean energy” is not just narrowly defined, it’s also a moving target.

Follow the Money

The DOE’s $19 billion dollar energy pie can be sliced in different ways. Here’s what that pie looks like based on the opening sentence of the DOE press release on the dozen projects: “The U.S. Department of Energy’s Loan Guarantee Program paves the way for federal support of clean energy projects…”

Chart 1 shows all monies as “Clean Energy” because it assumes DOE’s definition.

CHART 1

Chart 2 divides the DOE money based on renewable vs. non-renewable energy project.

CHART 2

[Note: As of Sunday (March 7), the DOE was unable to say how the $5.9 billion loan to Ford was divided between renewable and non-renewable projects. For that reason, Ford is not included in Chart 2.]

Substituting “renewable” for the ambiguous term “clean” gives a much different picture. Loan guarantees for renewable projects account for just over a third of DOE dollars. It’s instructive to look at a similar chart, with one difference — illustrating how funding for renewable energy stacks up against funding for nuclear power in this DOE program.

Chart 3 divides the DOE money based on renewable vs. nuclear power projects.

CHART 3

The non-renewable portfolio is almost entirely devoted to building twin nuclear power plants in Georgia, operated by Southern Nuclear. Removing the single other project in this category (the facility to produce activated carbon in Louisiana) has no effect on the whole number percentages of the renewable and non-renewable categories in Chart 2.

The point of this exercise is to underscore the importance of precision in discussing energy policy issues. In this debate, the words “clean” and “renewable” are often applied to the word “energy” as if they were synonymous. They aren’t.

Whether or not nuclear power should play a major role in our energy future is an enormously important question — but it’s not addressed here. In the DOE’s loan guarantee program, one form of energy is dominant: nuclear power.

Advocates of nuclear power will be happy with this arrangement. Renewable energy supporters, not so much.

Announced Projects in the DOE’s Loan Programs

  1. Solyndra, Inc. was awarded a $535 million loan guarantee (pdf) to manufacture innovative cylindrical solar photovoltaic panels that provide clean, renewable energy.

    Solyndra solar panel tubes


  2. Nordic Windpower USA has been offered a conditional commitment for $16 million (pdf) to support the expansion of its assembly plant in Pocatello, Idaho to produce its one megawatt wind turbine.


  3. Beacon Power, an energy storage company, has been offered a conditional commitment of $43 million (pdf) to support the construction of its 20 megawatt flywheel energy storage plant in Stephentown, New York that will help ensure the reliable delivery of renewable energy to the electricity grid.


  4. Red River Environmental Products has been offered a conditional commitment for $245 million (pdf) to build an activated carbon (AC) manufacturing facility near Coushatta, Red River Parish, Louisiana.


  5. Vogtle Electric Generating Plant (operated by Southern Nuclear) has been offered conditional commitments for a total of $8.33 billion in loan guarantees (pdf) for the construction and operation of two new nuclear reactors at the Alvin W. Vogtle Electric Generating Plant in Burke, Georgia.

    Vogtle Nuclear Power Plant


  6. BrightSource Energy, Inc. has been offered conditional commitments for more than $1.37 billion in loan guarantees (pdf) under the American Recovery and Reinvestment Act to support the construction and start-up of three utility-scale concentrated solar power plants.


  7. First Wind - Kahuku Wind Power has received a conditional commitment for $117 million to install twelve 2.5 MW wind turbine generators along with a battery energy storage system for electricity load stability.

    Wind turbines


  8. Sage Electrochromics has received a conditional commitment for $72 million to support the financing of the construction and operation of a 250,000 square foot, high volume manufacturing facility to produce SageGlass®, an energy-saving switchable window technology for commercial and residential use.


  9. Ford Motor Company has closed on a $5.9 billion loan (pdf) to transform factories across Illinois, Kentucky, Michigan, Missouri, and Ohio to produce more fuel efficient models.


  10. Nissan has closed on a $1.4 billion loan (pdf) to produce electric cars and battery packs at its manufacturing complex in Smyrna, Tennessee. The loan will aid in the construction of a new battery plant and modifications to the existing assembly facility.

    Nissan Leaf, EV


  11. Tesla Motors has been offered a $465 million loan (pdf) to finance a manufacturing facility for the Tesla Model S sedan and to support a facility to manufacture battery packs and electric drive trains.


  12. Fisker Automotive has been offered a $528.7 million conditional loan (pdf) for the development of two lines of plug-in hybrids that will save hundreds of millions of gallons of gasoline and offset millions of tons of greenhouse gas emissions by 2016.

[Source: DOE press release via email, 5 March 2010]