Guest post by Thomas Fuller
Over at Bart Verheggen’s weblog, Bart (who is a climate scientist who looks at aerosols) writes about innovation, implementation and efficiency, saying,
“Often, innovation (of new/improved energy technologies) and implementation (of existing energy technologies) are presented as if they are binary choices. Lomborg is a champion of that kind of rhetoric.
They are not: Both are needed, and both serve a different purpose (or at least, they are different, and complementary means towards the common goal of transforming our energy system towards a more sustainable one).
Innovation doesn’t actually reduce emissions. Rather, it is expected to allow for deep, fast and/or cheap emission reductions in the long term. Its pay-off though is inherently uncertain.
Implementation is needed to get started on emission reductions. It’s the cumulative emissions that are of concern, so earlier cuts in emissions are more useful to climate stabilization than similar cuts made later.
Counting on innovation as the only mitigation strategy risks postponing doing anything until a silver bullet comes along that may never will. Hence this strategy is sometimes referred to as fairy dust.
Counting on implementation only risks high costs to achieve needed emission cuts (or an effective inability to reach needed emission cuts, if we don’t want to pay for it).”
Bart is probably on the wrong side of the fence for many readers here, but he’s a good guy–more reasonable and reasoning than so many activist bloggers, and willing to at least discuss issues, rather than lecture and hector in the Rommulan or Tobitian mode. I urge those of you who haven’t visited his blog to give him a chance–you probably won’t agree with him, but his discussions are at least interesting.
But he’s missing one or two important points.
There is another way of dividing this problem up. Using renewable energy sources (possibly including nuclear, depending on the level of religious fervor you have) and improving the efficiency of our current means of generating, distributing and consuming energy.
The innovation strategies are not the same for each, obviously.
For renewable energy sources, the technology most likely to reach price parity with fossil fuels is solar power. The improvements needed to make it inexpensive enough to convince die-hard American Republicans that we should use it are well-understood. The complementary technology to make it scalable, grid level storage, is also understood, but farther off.
The appropriate innovation strategy would be to publicly finance research and development of storage, and offer tax incentives for accelerated deployment and development of solar. This is important as the last generation of fabs for solar cells still has mileage on it, and the owners want to milk the last penny out of it.
The dilemma nobody talks about (because nobody wants to advertise it) is the first mover’s disadvantage.
Anthony has kitted out his house with state of the art energy efficiency technologies, because he actually understands that it makes sense to try and make a difference. I gave up driving back in 1991 (with a clean driving record, I’ll have you know), because it seemed like the quantitatively most significant action I could take. I don’t regret my choice, and I doubt if Anthony regrets his.
But if I owned a business with a location in a warehouse with a flat roof facing southerly, I would still hold off on buying solar panels to cover it. There would be two reasons for my hesitation.
First, I am not certain that I won’t get a better deal from the government on tax incentives, depreciation and Girl Scout cookies later on. They do talk about such things quite frequently, both in Sackamenna and Washington. So even if it made sense in other ways, I might hold out for a better deal.
Secondly, and more importantly, I know that solar power gets 20% better with every generation. Two more generations and it will be so inexpensive and higher quality that it would be insane not to use it. Sound business principles suggest that I wait.
On a higher scale, the same decision-making process affects large industrial producers and consumers of energy. Take hydroelectric power. Uprating the turbines of a hydroelectric power plant can increase power output by 35% or more. That ain’t hay.
But turbines are increasing efficiency by at least 1% per year. If my current facility is operating profitably and I wait for 10 years before uprating it, I don’t have downtime for the plant, don’t incur the expenses of retrofitting, and have extra money in my pocket before uprating to an even more efficient turbine 10 years down the road. If I do it now, it’ll be second-hand news in 10 years, and who knows when some really dramatic innovation occurs that makes it impossible to resist.
In my personal life I am willing to put up with some inconvenience and risk a bit of unplanned obsolescence in my energy choices. But as a small business owner I do not have that luxury. There are people who depend on me making the right choices from a financial point of view.
And that’s the dilemma pretty much in a nutshell.
Thomas Fuller http://www.redbubble.com/people/hfuller
If energy efficiency was a priority, governments would be in charge of manufacturing companies. But since they are not and profit is the main goal, why sell only one turbine when there is far more profit in 18. So, efficiency is far down the lisy of a company.
Government leaders at times have big mouths on promises but do very little but impede progress.
You should see the massive hoops put into place on innovation for funding and trying to find a partnering company for R&D. Besides being an inventor, you must be a business man with a business plan, have a certain amount of funding yourself, belong to some institution or government agency, etc.
Solar power being a viable option in the nearish future in areas of the world with strong consistent sunlight is one thing, but it’s surely a very different matter elsewhere.
I somehow can’t come at taxpayer subsidised PV panels and sell back into the grid at 4 times the price you pay like we have in Australia.
I read about that boy scout in Chicago who built his own reactor out of old smoke detectors and gas mantles in a lead-lined box.
That sounds more interesting.
But I am a natural scrooge when it comes to emitting CO2 anyway. I refuse to put a motor on my boat and can usually manufacture enough wind to get where I want to go.
I think sceptics are naturally conservative in many ways.
He is correct in one respect.
My designs have been in many hands.
May ordinary people ooooooood and ahhhhhhhhhhhhhhhhed at the whole concept from designs to the math and science behind it.
Funny thing is engineers can tell you if it will work mechanically but put up one piece of science, and it goes way beyond their field. Even from college engineers it must go higher.
Mr. Fuller,
This is an interesting analysis and I don’t disagree with your conclusions but I am surprised that you did not bring up a major corporation that is going “green”, Walmart. Here is a company that originally sought to improve the fuel efficiency of its truck fleet by 25% over 10 years and then after taking a close look decided to make a target to reduce its energy consumption in the entire logistics network by 50%. So not only will they be driving fuel efficient trucks, they will make certain those trucks are traveling full, along the most effient paths, are not left idling, etc. Walmart is getting PR mileage from their effort for green credibility but what they are doing makes sense for their competative position in the market and if successful (and they are on track) will force their competitors to do the same or get beaten up on costs. The point is there are suprisingly substantial things that can be done to save energy and money that a holistic corporate wide push may uncover if someone pushes the limits.
Certainly, technology improves all the time. But your argument to wait ten years is an argument to never do anything, because you could apply exactly the same logic in ten years time. I bought a computer 13 years ago which had a 233Mhz processor. I bought another computer earlier this year with four 2.5GHz processors, and it cost a third of what the first one cost. According to your logic I shouldn’t have bought the first computer, I should have just waited and bought the second one. But you know, I actually found that first computer pretty useful.
A unique concept would be working together for the greater goal.
But it never works out that way.
Too many indepedant “my way or the highway” people who really do not get very far but do impede progress.
If it is profitable to be more efficient, businesses will be more efficient. After that it becomes a more complicated tradeoff.
I remember the gas boilers in the UK. Somebody came up with a boiler with a heat-exchanger on the output flue. It saved about 4%. The government mandated that type of boiler. Unfortunately that forced only that type of boiler on the market. It later turned out that the heat exchanger had reliability issues, which have significantly reduced the lifespan of the boiler. They would have hit the market eventually – accelerating the energy efficiency saving had quite significant environmental issues and great cost.
If the government had not got involved the less reliable boilers would not have been forced on the market. Forcing one parameter in design decisions has prices to pay in the others. Frankly I am getting tired of replacing equipment which has been ‘optimised for energy efficiency’ – generally for a greatly reduced lifespan. Every output pump on a washing machine is weaker than the generation before.
I don’t see the environment in terms of greenhouse gases. Why should I be forced to replace equipment every few years – probably with more c02 emissions but definitely other environmental issues – because you think energy efficiency is more important than conservation of other resources? Why should I pay for fuel efficiency of a hardly used car when really the environmental case would be for a more reliable but less efficient one? Before cost effectiveness allowed a range of criteria to be used. We are now optimising one parameter at the cost of the others.
How can anyone say that new technology will not cause future problems, not currently foreseen, as bad as or worse, or with no change, than the perceived problems related to fossil fuels?
Those developing past technologies, the wheel, fire, use of coal instead of wood, steam power instead of horse power, internal combustion engine instead of steam, certainly believed these new technologies were more “sustainable” (whatever that means) and better.
Europeans were quickly deforesting the land before coal, and then coal it was perceived would not last forever, then along came oil: the new “sustainable” technology.
Oil was OK for the Ecolunes before they discovered CO2, because coal was all about dirty pollutants such as particles causing global cooling (remember that?) and sulphurs causing acid rain – doom, doom, doom.
Nuclear energy, once declared by these Ecofascists the Planet consuming monster in-waiting, now it is grudgingly accepted as better than Planet consuming fossil fuels, which had they kept their voodo to themselves might have meant the current CO2 flap would not be on, if countries in the West had followed France’s nuclear power lead.
So now we are going to have new technologies which we have not yet invented, of which we cannot imagine, whose effects are then, unknown, but we are sure will be better than what we have got.
I think this just sums up the whole ghastly Globalwarmistclimatechange crystal ball gazing, action out of ignorance, non-reasoning, anti-common sense, non-fact based, anti-ManPestPlague, Latter-day Church of Pseudoscientology clap-trap.
Mr Fuller,
Your thesis seems to be that since everyone knows that things get better (more efficient) over time, then why would anyone invest now?
The argument is simplistic because it ignores the time value of money, also known as discounting cash flows. Simply put, $100 today is worth more than $100 in a years time, and much more than $100 in ten years time. Decisions of whether to invest in capital goods today are based on applying a discount rate to the annual cashflows that are expected to occur into the future. Since the promise of more cash that would be obtained in the future by waiting for more efficient technology to appear on the market, would have to be discounted to the Net Present Value, it is unlikely that businesses are avoiding investment for the reason you give.
The more likely explanation, is that without the guarantee of subsidies throughout the lifetime of the project, the current technologies are no damn good. Whether they ever will become competitive is impossible to predict.
Hmm, I’m getting increasingly concerned at Mr. Fuller’s reiteration of and slipping into his pieces such points as this:
“Innovation doesn’t actually reduce emissions. Rather, it is expected to allow for deep, fast and/or cheap emission reductions in the long term. Its pay-off though is inherently uncertain.”
Does he mean Co2? I assume so and it would be very useful to have him express his view, transparent and unequivocal, on this. I have no issue with sensibly reducing *real pollutants in whatever context but as long as the CO2 myth remains in power, the world remains at risk from those who propose reductions. I recall a line from Hamlet: “Meet it is I set it down
That one may smile, and smile, and be a villain”. I’m not remotely suggesting that Mr. Fuller is a villain but I *am beginning to feel that we are getting the thin end of a carbon wedge inserted in these pieces. Spit it out and we can talk about it – we are not passive here on this point.
My understanding of photovoltaics was that the polycrystalline silicon takes 3 or 4 years to produce a factory, and is expensive. I don’t think anybody believes that the type of solar panel which is cost effective will be based on polycrystalline silicon – it will be printed or sprayed on because the energy required to make the special silicon is a large part of the cost. Mandating solar panels in the UK or Germany where the sun is not that great risks redirecting the limited quantity of silicon from more effective locations – either because of no grid or because of the amount of sun.
I really don’t see why I should be subsidising anybody using the wrong solar technology in the wrong location at the wrong time.
Your belief in the continued growth of efficiencies in the current technology (turbines, solar, etc) is a utopian fantasy. Those solar efficiencies are in the lab only and the costs have come down on solar panels in general due to new manufacturing processes of old designs and massive government subsidies which hide and will continue to hide the true costs. No sane hydroelectric operator would shut down their operation to pick up a few % of efficiency after considering the new costs and the lost incomes. They aren’t waiting for a couple more %, they are waiting for their current turbines to break before replacing them.
I applaud your no driving gesture … even though it makes not one iota of difference in the air quality and quality of life of your fellow man it obviously makes you feel good about yourself. You could have just bought a Prius like the rest of the feel good crowd but you did something that required self sacrifice and for that you should be applauded.
I think people sometimes don’t understand what industrial power requirements are. For example, there are extremely large electric motors that are essential for pumping stations, opening hanger doors of aircraft manufacturing plants, etc. Many of these motors are in excess of 50,000 hp output, some over 100,000hp, which require an enormous amount of power to start and run. In addition there are metals manufacturing (aluminum in particular ) that use city size megawatts of electricity. And many other examples. You’re not going to get that kind of juice from solar panels on the roof or windmills in the parking lot.
You can ramble on all you want about comparatively minute adjustments to household electric use. It’s microscopically insignificant compared to industrial needs.
Tom
Please stop starting your dissertations from the CO² is a global warming disaster standpoint. Start from the view that we will eventually have to find new technologies to fuel our energy needs and fossil fuels will do for now. Then we can have a sensible conversation of types, timescales, cost and risks.
re your statement on hydro-electric turbines: I have reasons to belive that most good-sized turbines works at more than 94 – 95 % efficiency.
Sources for the claim of 30 % improvements?
Where I get lost in the arguments of the warmist community (and in a different context the neo-Malthusians) is when I come across phrases like:
My background is in history, to a great extent social history, and this concept of setting societal goals with learned discussions as to how to achieve them is broadly missing from my experience. The British have always had the reputation of “muddling through” but in reality humanity in general muddles through. The proverb “necessity is the mother of invention” is a simple statement of the way in which societies in general work.
Two of the best TV series on the history of scientific development were James Burke’s “Connections” and “The Day the Universe Changed” which to my mind still stand as an object lesson to those who think that it is possible directly to influence and direct societies. Technology advances as the need for change or its desirability overtakes existing technology. There is no limit to human ingenuity; when we want or need something we will find the way to make it happen.It cannot be forced by diktat.
Dollar cost averaging might put a thin edge of the wedge into first mover disadvantage. A continuous investment reaps the advantage from emerging efficiencies over time and anticipates upgrade or replacement at the end of useful life – and without putting off implementation.
We are in the age of CO2, so all roads must lead to CO2 to be credible- according to those who buy into CO2.
Tom, one thing you might want to check is where the link to your blog has gone in the WUWT blogroll. It seems to be missing.
Tom,
You seem to leave out one factor in your brief economic analysis of early adoption: pay-back time. A smart businessman, small or large, will calculate the break-even point and decide if more efficient technology is likely to be delayed enough to make his upgrade profitable. If the profit incentive is large enough and likely enough and the risks small enough and his competition strong enough, he will go with the upgrade.
I see the concentration on GHG as impeding progress. We had to change air conditioning equipment to less effective refrigerants, negating some of the improvement in efficiency. True, scientists and engineers have adapted to the elimination of CFC’s, but at a significant cost.
RW:
I don’t think that he is saying that following that path, no one would ever innovate. The point is, if he bought the product and planned on running it 30 years, he doesn’t want to replace it in 10 or 15 years. After running it for 15 years, he begins to see where things are going and maybe in 10 years when he is ready to replace it, he will get a much more efficient product. People can’t just innovate every year just because some new product comes along. Only Bill Gates could do that.
If we really want cheap solar power, we need to put the solar panels in space.
There is a solution. Back in the 50s, the scientists behind the Manhattan nuclear bomb project tried to find a peaceful use for the awful device they had created. Their solution was Project Orion – a design for a space ship engine which used nuclear explosions for propulsion.
http://en.wikipedia.org/wiki/Project_Orion_(nuclear_propulsion)
The performance of the proposed engine would have been a rocket engineer’s wet dream. Designs capable of lifting thousands, even millions of tons into Earth orbit were proposed, and enough initial field testing was performed to prove the viability of the concept – including field tests which proved it was possible to build structures capable of surviving, without damage, the full force of a nuclear fireball. The most advanced designs, using H bombs, could theoretically have accelerated a starship up to 10% of the speed of light – fast enough to reach the nearest stars in a human lifetime.
All this with 1950s technology.
Such ships would be more than capable of lifting as many large solar cell power stations into space as you want, for an affordable price.
All the Greens have to do is endorse a few thousand atmospheric nuclear explosions – not much different to what happened during testing in the 1950s…
This is where you lost me;
“Implementation is needed to get started on emission reductions. It’s the cumulative emissions that are of concern, so earlier cuts in emissions are more useful to climate stabilization than similar cuts made later.”
Sorry. “Cumulative emissions”? Emissions of what? My Grandfather used to say: “No point dancing in the dark! Out with it!” Why don’t you fess up and just admit that you agree with the hysterics and be done with all this dancing around? You gotta a carbon tax Jones! You keep sneaking AGW talking points into your essays without addressing why they are needed in the first place. Cart before the Horse. Just like all the other media dupes.
Sorry Mr Fuller. I ain’t buyin’ anymore.
Having done a little research into the development of renewable energy “technology”, I can say with a great deal of certainty that this article is a load of hogwash – particularly for wind energy.
Wind energy did not develop as a result of “innovation”. Quite the contrary, those countries who tried to “innovate” were utter failures at developing wind energy. Indeed I found the success of developing renewable energy “technology” was inversely proportional to the amount of R&D spend … the most successful development had the LEAST R&D SPEND.
It all comes down to the need for incremental development (characteristic of engineering) instead of spontaneous innovation (characteristic of “science”). These in turn are dependent on the cost-profit profile and the type of niche markets and various other economic factors which would take too long to detail here (and no one pays me to explain)