HOW TO GET TO THE NEW ENERGY ECONOMY (AND HOW NOT TO)

There are solutions to what ails this good earth.

Solutions come in the form of abatements to the production of greenhouse gas emssions (GhGs). The most important current studies make evidence-based comparisons of strategies for using New Energy and Energy Efficiency to abate GhGs. McKinsey and Company’s Pathways to a Low Carbon Economy offers policy-makers a broad-spectrum analysis on which to base action.

Reports are ultimately only as valuable as the purposes to which decision makers apply them.

Perhaps the McKinsey report will find better use than decision-makers in West Virginia are presently making of Downstream Strategies’ The Long-Term Economic Benefits of Wind versus Mountaintop Removal Coal…, a study showing wind – when the costs of emissions and other externalities are considered – is a better investment than coal.

The McKinsey report looks at 4 major categories of “abatement activity”: (1) Energy efficiency, (2) low-carbon energy supply (New Energy), (3) terrestrial carbon – forestry and agriculture, and (4) behavioral change. Over 80% of the reductions evaluated fall into the first 3 categories and are considered cost-effective.

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The report compares the relative costs of using different technologies. Although the cheapest “abatement” technologies are not necessarily the most effective, many of the technologies are likely to generate more in savings than they would cost to implement, lowering the cost of power both for producers and consumers.

Total cost: Less than 0.5% of the world’s gross domestic product (GDP). And that’s without considering the enormous cost of doing nothing.

As Al Gore and many others have said when asked if abatement action is affordable, the real question is whether it is affordable NOT to take action. But this report is a little more specific: “…the investment required seems to be within the long-term capacity of global financial markets (as long as the current credit squeeze doesn’t have significant consequences in this time horizon)…”

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4 crucial areas where policy and regulation are necessary to drive development: (1) Establishing incentives to make Energy Efficiency implementation cost effective, (2) Making incentives to big energy producers and consumers stable, (3) instituting incentives to get New Energy and Energy Efficiency technologies to grid parity and (4) linking of forestry and agricultural practices to larger, productive agendas.

3 areas that could impact the report’s conclusions are (1) variations of energy prices (high energy prices spur abatements), (2) technological innovation (breakthroughs that move New Energy to grid parity spur abatements), and (3) availability of capital (low interest rates spur abatements).

Delaying action 10 years will lock in another 2 degree Centigrade increase in the world’s mean temperature because it allows 10 years more for building fossil fuel-consuming infrastructure. 2 more degrees of temperature rise puts the earth right at - or over - the brink of catastrophe.

Dr. Richard Moss, WWF vice president for climate change: “This makes acting to use these technologies even more of a no-brainer…If we fail to act, climate change will alter water resources, agriculture, and ecosystems, resulting in impacts on the economy and human health that could run to the billions of dollars annually in the United States alone. By reducing emissions, we will avoid some of the worst damages and leave the world’s natural heritage intact for future generations.”

The urgency of action is what makes the plight of the courageous defenders of Coal River Mountain so poignant. (For the full story, see FIGHTING COAL WITH WIND) The activists fighting to get West Virginia to put a wind installation on top of the mountain instead of allowing Massey Energy to destroy it for a coal mine recently sent out an update.

From the Coal River Mountain Wind team: “There has been a lot going on, not much of it in our favor, so we could still use your help in spreading awareness of the campaign and the urgency of the situation. Please continue to share our website and the story of Coal River Mountain with your friends and colleagues, and even write letters to your local newspapers and legislators urging their support for the residents of the Coal River Valley.”

The story, short version, is that a wind installation would generate more, cost less and create more jobs but Massey Energy is in the coal business. (See Downstream Strategies’ The Long-Term Economic Benefits of Wind versus Mountaintop Removal Coal…)

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From Coal Mountain: “Massey has begun pre-mining activities below the ridge where the first phase of mining is set to begin. It is hard to determine exactly when they will be set to blast, and for now they have yet to construct a road up to the ridge, but they have shown their intent by clearing the forest and constructing a road and sediment ditches… we’ll keep you updated...”

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To some, it is intuitively obvious the wind proposal is preferable to the environment-destroying coal mine. For those who prefer hard facts, the Downstream Strategies report is conclusive.

If neither of those is convincing, consider the McKinsey report’s conclusion: “Our analysis finds there is potential to reduce GHG emissions…sufficient to have a good chance of holding global warming below the 2 degrees Celsius threshold…Capturing enough of this potential…will be highly challenging…A 10-year delay in taking abatement action would make it virtually impossible…”

The contrast between what the McKinsey report calls for, what the Downstream Strategies report shows and what the state of West Virginia is set on doing is a more eloquent, if tragic, close for this essay than any words NewEnergyNews can offer.

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McKinsey Study Outlines Path to New, Green Economy
26 January 2009 (World Wildlife Fund)
and
Update from Coal River Mountain
Jesse Jenkins, January 30, 2009 (It’s Getting Hot in Here)

WHO
McKinsey & Company; Ten sponsors, including World Wildlife Fund (WWF) and energy, automotive and technology companies; Raleigh County Commission; West Virginia Surface Mine Board; the Coal River Mountain Wind team

WHAT
Pathways to a Low Carbon Economy shows how New Energy, if fully deployed, can cut global greenhouse gas emissions to 55% below 1990 levels by 2030. The destruction of Coal River Mountain for a coal mine instead of using it for a wind installation is not the sort of thing the report favors.

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WHEN
- 2020: Waiting 10 years to act will lock in another 2 degrees Centigrade in the world’s mean temperature rise.
- By 2030: Wind, solar and other New Energies can achieve impactful scale Energy Efficiency can cut GhGs another 25%.
- January 6 the Raleigh County Commission rejected the study finding wind a better economic choice of Coal River Mountain.
- February 10 is the next challenge of Massey energy’s plan when Coal River Mountain Wind asks the West Virginia Surface Mine Board to revoke a permit.

WHERE
- The study evaluates solutions across 10 sectors and 21 geographical regions.
- Deforestation in developing countries causes 16% of global GhGs but could be almost eliminated.
- Coal River Mountain is a 10-square-mile mountaintop removal coal mining site near the communities of Clear Fork and Marsh Fork in Raleigh County, West Virginia.
- The Surface Mine Board hearing will be at the Department of Environmental Protection headquarters in Kanawha City (Charleston) at 601 57th St.

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WHY
- This is considered one of the largest and most detailed reports of its kind, listing 200+ opportunities for GhG abatement.
- The report was peer-reviewed by scientists, economists and expert bodies, including the World Wildlife Fund (WWF).
- The abate strategies could cut GHGs 55% below 1990 levels, a 70% reduction from the business as usual (BAU) scenario.
- GhG reductions can come from 4 major categories:
(1) Energy efficiency: 14 gigatonnes (Gt) of carbon dioxide equivalent (CO2e) in 2030.
(2) low-carbon energy supply: 12 Gt of CO2e in 2030.
(3) terrestrial carbon – forestry and agriculture: 12 Gt of CO2e in 2030.
(4) behavioral change: 3.5-to-5 Gt of CO2e in 2030.
- Example of an abatement considered cost-ineffective: Retiring operational fossil fuel power plants in heavy industry and replacing them with low-carbon power plants.
- Behavioral changes (examples: reducing business and private travel, shifting road transport to rail, cutting heating and cooling with an acceptance of less altered ambient temperatures, cutting use of appliances, cutting meat consumption) are considered too difficult to predict.
- The report provides extensive discussions on the 10 sectors, where present GhGs are generated and what abatement strategies will change that.
(1) Power generation, the biggest source of GhGs and the biggest opportunity for cuts.
(2) petroleum and natural gas accounts for 6% of GhGs and could grow 1/3 without efforts at abatement.
(3) cement: 4% of global GhGs, 45% of those from China; could grow 3%/year but cvould be cut 25%.
(4) iron and steel: 6% of global emissions, growing 3.2%/year with 55% coming from China by 2030.
(5) chemicals: 4% of global GhGs, could be cut by 38% with changes in the chemical industry.
(6) transport: 12% of global GhGs, could almost double by 2030 but with technological innovation in vehicle fuel (such as electric, natural gas, next generation biofuels and hydrogen vehicles) it could be stabilized by 2020 and cut almost 1/3 by 2030.
(7) buildings: 18% of global emissions, could grow 53% by 2030 but could be cut 25%
(8) waste: 3% of global emissions, could grow 1.7%/year but could be virtually eliminated with recycling techniques.
(9) forestry: 16% of global GhGs, abated by avoiding deforestation but a difficult undertaking due to the diffuse locations, fragmented players, complex policy factors and inadequate capacities to impact.
(10) agriculture: 14% of global GhGs with Asia, Africa and Latin America accounting for 80%; 50% could be abated, mostly through soil sequestration.
- Coal River Mountain Wind has proposed a 328 megawatt wind installation for the mountain instead of the coal mine.

The activists of Coal River Mountain Wind have stopped the project so far but they are running out of options. From The CleanDotOrg via YouTube.

QUOTES
- Dr. Richard Moss, WWF vice president for climate change: “This report provides further evidence that we can grow our economy and cut greenhouse gas emissions at the same time…If the policies were in place to force the broader deployment of the technologies highlighted in this report, thousands of new jobs would be created across the country. And these new job-generating technologies would put us on a path for dramatically reducing emissions and keeping global average temperatures from rising above the dangerous threshold of 2 degrees Celsius, or 3.5 degrees Fahrenheit.”
- Dr. Richard Moss, WWF vice president for climate change: “The report demonstrates that we can save money for consumers if we enact some relatively straightforward policies and measures to overcome market barriers and failures that impede adoption of low-cost energy efficiency and alternative energy technologies…By reducing energy consumption, we could also lower energy imports and increase our energy security.”
- From the Coal River Mountain Wind update: “Instead of embracing the study’s conclusions and the opportunity to diversify the local economy and bring in new industries that would help soften the blow of the boom-and-bust cycles of coal, the Commission chose to ignore the merits of the study altogether and instead chose not to “pit one industry against another.” Unfortunately, the Commission and the state government are holding tight to that false logic, and so we are now hoping to catch the attention of national leaders who might help us in the fight for the future of the mountain.”