Energy transitions and the end (or not) of civilization

Steve recently posted (not I) on the possibility of a big breakthrough in cold fusion technology (hey, he is at the University of Utah after all; on Fleischmann and Pons see here). But even if that occurs in the near future energy transitions tend to be a very slow process as explained by Vaclav Smil (reference below), which should make you a bit more pessimistic.

He suggests that it was in the 20th century that we finally did the transition to oil from coal, and that the 21st should be a slow transition to natural gas, with increasing role, but not yet dominant by alternative technologies. By the way, Smil is way more skeptical than Steve on the possibilities of what he refers to as 'soft energy illusions.'

The process is really slow. He shows that, in the US, only in the 1880s coal surpassed wood as the main energy source, something that occurred in China somewhere in the 1960s, and is still happening in some places in Africa. The 19th century was still part of the millennia dominated by wood burning, and the 20th century was dominated by coal, with oil becoming relevant towards the end. By the way, coal still generates almost 30% of the world's electricity. The figure below shows the time frame of energy transitions.

Given the slow transitions and the effects of biofuel consumption on climate change it would seem that we are doomed. However, Smil is considerably more optimistic (on this he resembles Steve) on the possibilities for the survival of civilization.

The biggest change in last two centuries with respect to energy use is the rapid increase in efficiency. As he notes, in open fires only 5% of wood's energy ends up as useful heat, while today's most efficient furnaces convert around 95% of natural gas to heat. So with better batteries, non-oil based fuels, less wasteful transmission of electricity, and more efficient technologies in general one can expect per capita stocks of useful fossil fuels will be only marginally smaller by the end of the century, and perhaps with a significant reduction on their environmental impact.

In fact, he suggests that with about half today's energy demand it is possible to maintain the quality of life associated with the world's developed countries, and, hence, the eventual decline in oil's share in the global energy supply will not mark the end of civilization (which I'm glad, since I'm kind of personally attached to civilization).

Also, I should point out, increased efficiency may come out of regulation, as noted by Smil. For example, the Corporate Average Fuel Economy (CAFE) regulations, which allowed for a doubling of the average efficiency from 13.5 to 27.5 mpg (and you thought regulations do not work!), were incredibly efficient. The other way to improve efficiency is economic growth (as I argued before; that was I, not Steve).

So it seems that if you want to preserve civilization, growth and regulation is the way to go. Of course that is no guarantee that that we'll get either regulation or the kind of technical change that comes with growth (in particular, austerity seems to suggest a prolonged period of stagnation, but that should not make you happy even from an environmental point of view).

Reference:
Smil, Vaclav (2010). Energy Myths and Realities: Bringing Science to the Energy Policy Debate. AEI Press. Kindle Edition. 

A farewell to growth?



It has been common for certain progressive groups to suggest that better income distribution and no growth, or even degrowth more recently, would be better than the capitalist driven consumerist growth process [for a critical review of this literature go here]. Several different strands of thought are involved in this view, and it would probably be worthwhile to disentangle them all.

First, there is an obvious Malthusian flavor to this view, going back to the dire predictions by the Club of Rome in the early 1970s, as a result of limited availability of non-renewable resources. Peak oil has been predicted a few times since. And yes it may very well happen in the near future, but somehow I doubt it. Remember that we moved away from coal and steam engines to oil and combustion ones, not because coal disappeared or became truly scarce, but simple because technological change made it less important as a source of energy (and yes we still burn a lot of coal).

In that sense, our problem is less that we have reached the limits of the existence of renewable resources, but more that the consequences, which are associated to Green House Gas (GHG) emissions, will be and already are dire. It is very likely that climate change caused by GHG emissions will lead to increasing costs in terms of food shortages, for example. But the question there is less that we cannot grow [the Malthusian thing, food does not grow as fast as population; the quintessential anti-Malthusian was Ester Boserup, an early feminist economist, that showed that agricultural productivity was determined by population dynamics; in other words, higher population growth led to increasing agricultural productivity], but who bears the costs of growth.

We leave in a world in which many developing countries import food, in part as a result of very high productivity in agriculture in developed countries, and in part as a result of subsidies and trade policies imposed by developed countries. The costs of global warming will fall overwhelmingly over poor and food-insecure countries in dry and tropical regions, that largely depend on rain fed farming, mostly in Sub-Saharan Africa and South Asia.

That means that a more equitable system to redistribute the costs of climate change, and alternative trade and agricultural policies are needed, which provide food security around the globe. Further, to reduce the effects of climate change a huge increase in spending on R&D is necessary.A Green New Deal or environmental equivalent of the space race, and lots of regulation would do a great deal to promote new and cleaner technologies (see for example the 2006 documentary, “Who Killed the Electric Car,” on what a California regulation did for the electric car).

Finally, note that there is no evidence of sustained technological progress (call it division of labor, or productivity, and you see that the wealth of nations might depend on it) with zero growth or negative growth. Productivity is not only pro-cyclical, but also structurally connected to growth. No growth in demand means limited incentives to productivity increases. So only with economic growth there is a hope of getting cleaner technologies. Degrowth also might lead to all sorts of environmental degradation, since it is far from clear that a society with spiraling down output would manage resources efficiently.

Second, there is peculiar view of the relation between income distribution, consumption patterns and economic growth. The notion is that no growth is necessary, since better living conditions can be obtained simply by redistributing income. The presumption seems to be that income distribution will have no effect on patterns of consumption and on economic growth. It is true that the effects of income distribution on growth are ambiguous, but the presumption that they have no effect is very strong.

I have my own views on what is more or less likely under the particular circumstances we are in. It seems reasonable, that if the redistribution towards the less privileged that the no-growth/degrowth crowd want took place that a consumption boom would follow. Particularly in developed countries were wages have been repressed for a while and which the last few years of the recession have made worse. And that would lead to growth, which is the opposite of what they want. But as much as I would favor that sort of redistributive policy, alas it is not in the cards.

Further, although it is true that consumerism is in many respects created by corporations and several elements in the consumption patterns in modern advanced societies are wasteful, one might also be careful about the false moralism of the New Puritans, as James Livingstone refers to those that preach that all thrift is good and all consumption bad. Consumption is associated to growth, and to better living conditions for the poorest among us. After all it has been the consumer society created by the Industrial Revolution that allowed us to obtain several of the benefits that we now take for granted in civilized societies, with longer life expectancy and better quality of life.

Finally, there is a naïve neoclassicism that is also part of the problem with the no-growth/degrowth crowd. It seems that for some, economics is synonymous with a certain view in which supply and demand determine everything, and, hence, the rejection of the consequences of those neoliberal policies must pass through the rejection of growth too.

Of course growth might not be associated to the market forces as suggested in neoclassical theory (and markets might actually work in very different ways than the mainstream thinks they do). Growth might often be the result of limiting the power of markets, and driving economic forces towards alternative goals. And, while it is certainly true that not all growth is good for the environment, an alternative (and Keynesian) perspective of what is behind growth and development processes might open the door for more environmentally friendly economic dynamics. A simple example would be to use the proceeds of say nationalized and heavily regulated oil extraction for investment in research and development of new technologies.

PS: Obviously all of the views discussed above are not held necessarily by any particularly person that believes that no-growth or degrowth is necessary. And I left a few additional views out, e.g. a view that capitalism is doomed and we are on the verge of a new (perhaps better) system (by the way, I don't agree with that one too; capitalism is doing fine, even if workers are not). But all of these propositions are part of the arguments used by different people to suggest that the benefits of economic growth are overrated.

Perverse dependence on Asia

By Luiz Carlos Bresser-Pereira

Published originally in portuguese in the Folha de S. Paulo, January 16, 2012

In his last column, Martin Wolf mentioned the fact that, since 2007, the fast-growing Asian countries have grown by 60%, whereas rich countries have grown by 3%, and he pinned the world's economic hopes in Asia. Brazil, in the same period, grew by modest 16%. Brazilians also depend on the increase in Asian demand to achieve their growth. Brazilian economy is not stagnant as the economy of developed countries, but, in terms of growth, it is closer to them than to countries such as China and India.

Read the rest here.

Cold Fusion and Population - Environmental Musings

The center of gravity on climate change/global warming/... on the left is pretty fairly represented by Dean Baker's recent blog saying it's lights out figuratively and literally if we don't change our profligate energy ways. And this is by far more important inter-generationally than the current aggregate-demand-deficit-led fiscal deficits. Dean's post is here.

And, given mainstream science, he's absolutely right. This leads to the growth-neutral advocates with whom I have a moral problem in that it condemns the poorer nations to less wealth than we living in advanced countries enjoy. If that is to be the outcome, we should be crystal clear sure of our environmental arguments. I do not challenge results like those from the IPCC.

However, there are a couple of mitigating things going on, one in the realm of economics, and one in the realm of heterodox science.

First, for a recent department seminar on environment, I put together some data using the Kaya model and UN population projections to project CO2 emissions. What this clearly shows is that among greening of energy sources, energy efficiency, and population growth, it's population growth, through GDP growth, that has the greatest impact on CO2, by a factor of at least three times.

And, the closer we are to the UN 2010 population low estimate of growth, the better off we are, in fact, my analysis shows we bend down the CO2 curve starting in about 2050. Fertility reduction is what we should focus on. Fortunately, it is clear in the literature that GDP per capita growth and female education both significantly correlate with reduced fertility rates, and those trends are in train around much of the world.

So the best solution for CO2 mediation in the current context is headed in the right direction; we should give it a major shove. Helicopter drops of books and family planning items. You can see my slides here. Make sure to check out the embedded motion chart to visualize the effects of GDP and education growth on fertility by country. There may be hope in the following sense.

Growth of per capita income is not necessarily that bad for the environment, and those defending De-growth (reduction of GDP) might understate the economic, social and environmental effects of their policy suggestions.

Second, I will talk a bit of non-mainstream science, and thereby prove myself crazy for doing it publicly.

Remember cold fusion? In 1989 Professors Pons and Fleischmann, right here at the University of Utah, reported experimental results for an over-unity chemical reaction in a press conference. They were immediately, viciously, humiliated and attacked by the scientific mainstream, especially those whose gored ox was pulling the generously funded hot fusion projects. The cover story was that this violates thermodynamic laws. Case closed.

Except physics has evolved theories in which such results are supported without violating thermodynamics.

And one of the many serious experimenters working in cold fusion since 1989, Andrea Rossi, has announced and shipped an over-unity megawatt heat generator that uses its modern incarnation LENR, which stands for Low Energy Nuclear Reaction. The mainstream science is still out on this, but if its commercially successful, who cares?

Well, Dennis Bushnell, the chief scientist at NASA Langley, cares, and has spoken. He thinks LENR is a revolutionary epoch-changing technology whose time has come, a true game-changer.

I have gone on further than most care to read in one blog, so will stop and not embed more word or links in this post. Depending on the interest and tolerance for these surprising ideas, I will offer to follow up on this and post more sources.

Let me finish by saying, if true, this will put us on the road to virtually unlimited, very cheap, zero pollution distributed and compact energy sources. That would change much that is wrong with our current economies on the physical (but not distributional) side. And Dean Baker would be freed of his inter-generational global warming dilemma, so can get back to creating jobs here and now.