"Power Window: Bright Ideas," Feature Article, December 2006

power window:

bright ideas

by Jeffrey Winters, Associate Editor

it wasn't so long ago that energy issues took a back seat in electoral politics. As recently as the 2000 presidential campaign, energy security and power delivery were overshadowed by other, more pressing issues, such as how quickly we should pay off the national debt and who invented the Internet.

Of course, things aren't that much better today. Even though the past six years have witnessed rolling electricity shortages in California, a regional blackout in the Northeast, record natural gas prices, and the loss of critical petroleum infrastructure due to storms in the Gulf of Mexico, the midterm elections this year were more a referendum on the war in Iraq and Congressional scandals than on the nation's energy security.

And yet, leaders in both political parties have begun to make energy issues a point of emphasis in speeches and commitments. This fall, for instance, the leading players of the 2000 campaign—former Vice President Al Gore and President George W. Bush—gave widely publicized speeches on the importance of changing the way we, as a nation, produce and consume power. It remains to be seen whether any of these prescriptions can be turned into action. But it is worth looking at whether they are working with numbers that add up.

One of the valid criticisms of Gore's movie this spring, An Inconvenient Truth, is that it was long on diagnosis—that the Earth is undergoing catastrophic climate change due to a human-produced surge in carbon dioxide in the atmosphere— and short on remedy. Many viewers were left with unanswered questions about what they could do to halt this change. Gore gave a speech in September at the New York University School of Law that responded to those questions.

The first action, Gore said, was an immediate freeze in rates of carbon dioxide emissions. "Merely engaging in high-minded debates about theoretical future reductions while continuing to steadily increase emissions represents a self-delusional and reckless approach," Gore said. "In some ways, that approach is worse than doing nothing at all, because it lulls the gullible into thinking that something is actually being done when in fact it is not."

While this proposal has the virtue of being easier to understand than competing, more complicated plans, it is far from simple. One look at the projected CO2 emissions for the United States and the rest of the world reveals that there is a great deal of carbon emission built into standard business assumptions—not just in the power industry, but also in transportation, construction, and other areas of the economy.

Indeed, the power industry might not even be the largest roadblock. According to data from Global Energy Decisions, a consultant group based in Boulder, Colo., only about 35 percent of the 114 gigawatts of new electrical generating capacity already planned to come on line by 2010 is coal-fired. Some 20 percent, in fact, is carbon-free generating capacity, mostly from wind farms, with the rest slated for natural gas-powered turbines. There are many legacy facilities that will continue to burn coal, often in wasteful if cheap ways, but the market seems to be moving in other directions on its own.

Gore presented some other ideas, ranging from redesigning factories to reuse waste heat to modeling a restructured electrical grid on the Arpanet, the first strike-proof network of defense-related computers that was the precursor to the Internet. "The Electranet," Gore said, "could give homeowners and business owners accurate and powerful tools with which to precisely measure how much energy they are using where and when, and identify opportunities for eliminating unnecessary costs and wasteful usage patterns." And while the idea of his so-called Electranet seems fanciful at first blush, utilities are already working to incorporate Internet-based communication to send variable price information to household appliances.

If Gore was visionary in his September speech, President Bush was far more grounded at the Renewable Energy Conference in St. Louis in October. "My worry," Bush said, "is that a low price of gasoline will . . . make us complacent about our future when it comes to energy, because I fully understand that energy is going to help determine whether or not this nation remains the economic leader in the world. We're doing fine now. We've got a really strong economy, and in order to make sure it's strong tomorrow we need to make sure we work on how we use energy."

The president played up research into battery technology— critical to both plug-in hybrid cars and many renewable energy technologies, such as wind and solar. But the centerpiece of his speech was his commitment to ethanol fuel. "So you've got a lot of [ethanol] plants here in the Midwest," Bush said. "The vision has got to be for these plants to be able to spread throughout the entire country. And when it does, ethanol will become a primary source for the fuel people use, which will help us meet our national security and economic concerns and objectives." The president also highlighted the subsidies that have helped triple ethanol consumption in the past six years and a $250 million initiative for research into converting cellulose, a common plant material, into ethanol. (Current technology uses less-available sugars and starches.)

But how much petroleum can ethanol replace? No one has suggested converting the entire corn harvest into ethanol, but even those 10 billion bushels would yield only about 28 billion gallons of ethanol. With an annual gasoline consumption of 140 billion gallons and climbing, the United States has a need for transportation fuel that is just too great for corn alone to meet. Even the most optimistic scenarios for cellulosic ethanol will likely fall short of a total replacement. Does that mean that biofuels are worthless? Absolutely not. But they can't substitute for making other, probably more difficult changes and investing much more money into energy research.

That last point is where real leadership will be needed. The New York Times recently reported that federal research and development spending on energy has sunk to $3 billion a year, which is less than 40 percent of the funds devoted to it a generation ago when adjusted for inflation. Vision is great, but it's no substitute for cold, hard cash.