First Mover Disadvantage

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

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September 16, 2010 12:37 am

Hi Tom,
I didn’t specify a future time frame because 1) I was talking about an event in the past and 2) because the timing is inherently uncertain.
About the Eemian period (last interglacial) estimates of globalsea level that I’ve seen range from 5 to 9 metres higher than present. Global avg temp was 1 to 2 degrees higher, with strong Arctic amplification (on WUWT a recent article was quoted with 5 deg above current avg in the Arctic). Check some scientific articles via google scholar and you’ll find it easy enough; I’m not making this up or saying anything radical here.
We’re well on track to reach and even exceed those temps, and it’s not unlikely that sea level will eventually catch up as well. I don’t know when “eventually” is, and I’m not comforted by not knowing. But in past records of sea level, there were periods with sea level rise of 1-2 metres per century, indicating the physical possibility of such rates.

Julian Braggins
September 16, 2010 1:49 am

Bart Verheggen says:
September 15, 2010 at 1:44 pm
You may well hold on to long established ‘ facts’ of CO2’s absorption and emission of IR, but it may be that you haven’t kept up with the science of it in atmospheric conditions.
Here is a brief extract from a 13 page article by Nasif Nahle dated May 12, 2010
http://biocab.org/ECO2.pdf
“Doubling the density of carbon dioxide in the atmosphere causes the total emissivity of the carbon dioxide to decrease, as long as the radiant energy emitted by the surface does not increase causing an increase of the air temperature; therefore, the total emissivity of the carbon dioxide is inversely proportional to its effective pressure and, consequently, to its density in the atmosphere. The same effect has been verified on the tables of total emissivity of the carbon dioxide obtained by Hottel, Leckner and other contemporary scientists (1)(2)(3)(4). This fact confirms that the carbon dioxide operates as a coolant of the atmosphere and the surface, not as a warmer of the mentioned systems. (6) “”
Other comments on the emissivity of CO2 have been posted on blogs recently , a relevant one on
http://www.physics forum.com/archive/index/t-174215.html by cbacba Sept 1-07, 08:55 PM
Quoting, “Again, calculating the epsilon (emissivity) for the atmosphere for an old and new value using atmospheric absorption from the Hitran database results in a negative result when the new emissivity is applied. That means the temperature drops because the radiation output of the atmosphere becomes more efficient with the new increased emissivity.”
So you may be worrying about nothing 😉

Julian Braggins
September 16, 2010 2:03 am

Bart Verheggen says:
September 15, 2010 at 1:44 pm
You may well hold on to long established ‘ facts’ of CO2’s absorption and emmission of IR, but it may be that you havn’t kept up with the science of it in atmospheric conditions.
Here is a brief extract from a 13 page article by Nasif Nahle dated May 12, 2010
“Doubling the density of carbon dioxide in the atmosphere causes the total emissivity of the carbon dioxide to decrease, as long as the radiant energy emitted by the surface does not increase causing an increase of the air temperature; therefore, the total emissivity of the carbon dioxide is inversely proportional to its effective pressure and, consequently, to its density in the atmosphere. The same effect has been verified on the tables of total emissivity of the carbon dioxide obtained by Hottel, Leckner and other contemporary scientists (1)(2)(3)(4). This fact confirms that the carbon dioxide operates as a coolant of the atmosphere and the surface, not as a warmer of the mentioned systems. (6) “”
Other comments on the emissivity of CO2 have been posted on blogs recently , a relevant one on
physics forum Sept1-07, 08:55 PM
Quoting, “Again, calculating the epsilon (emissivity) for the atmosphere for an old and new value using atmospheric absorption from the Hitran database results in a negative result when the new emissivity is applied. That means the temperature drops because the radiation output of the atmosphere becomes more efficient with the new increased emissivity.”
So you may be worrying about nothing 😉
I included links on the first posting, but spam filter must have swallowed it.

TomVonk
September 16, 2010 3:01 am

Tom Fuller
I do not think that you are a troll .
I know for a fact that you are superficial and don’t deliver .
I discovered your blog a year ago when you started an interesting poll about the structure and motivation of climate beliefs .
A link on WUWT gave teh information and I did so to help your project .
You did then 2 folllow up posts promissing developpements but dropped the ball shortly thereafter and went to greener pastures .
This one idea that promissed something turned out a failure for lack of dedication and because you prefer to follow where the wind blows you .
Concerning the issues of efficiency and economy .
The deep understanding of the real economy and free markets follows approximately this ranking :
1) Owners of small businesses
2) Farmers
3) Bankers
4) Engineers
5) Lawyers
6) Journalists
7) Scientists
This ranking is a result of a darwininan selection process . Economy understanding is vital for the first categories while it is an irrelevant hobby for the last .
Of course the ranking is not absolute – f.ex a scientist who wants to run a small business will have first to acquire an understanding of economy that he would have never acquired if he just continued to produce paper .
So now why would anybody consider seriously a journalist’s opinion quoting a scientist’s blog on matters relating to economy ?
Clearly , like another poster already mentioned , the principal engine of economy , namely the discount rate which measures the preference for today with regard to tomorrow is not understood .
This (among others) :
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.
is a complete nonsense that only the lowest ranking categories like journalists and scientists could say . There is nothing sound in it .
What a sound businessman would do , would be to compare the DISCOUNTED profits/cash flows expected (tomorrow) from the investment in solar power over the estimated life time of the investment with the total cost of the investment (today) .
If the former is significantly larger than the latter he would invest immediately .
If not , then he would never invest .
If it is of the same order of magnitude , he wouldn’t invest either because an investment project is always a bother , takes time and generates indirects costs that are rarely accounted for .
Of course if some misguided politician promissed the businessman with a binding contract that he will get tax payers money that adds to the discounted cash flow , then it will be accounted for and a decision of invest in an unprofitable project can be taken .
Obviously in such a process global value is destroyed because the decisions taken are not the most cost effective over the long term .
One could also add that tax payers money should go in sectors that tax payers can’t or won’t do themselves anyway – army , police , justice , infrastructure .
The tax payers certainly not only can do business alone but understand it infinitely better than state bureaucrats whose origin is mostly from the lowest catogories in economy understanding .

Curiousgeorge
September 16, 2010 3:46 am

Tom Fuller says:
September 15, 2010 at 11:31 pm
Curious George,
Answering your question–no, not necessarily. But I think they should be given the option to buy insurance.

Well, there it is isn’t it? We are not being given the “option”. We are being forced to hug the tree via various mechanisms such as gov’t mandates that require chosen technologies be implemented at tax payer expense. Much like the recent “Health Care Bill”. We are penalized for not buying your insurance.

Joe Lalonde
September 16, 2010 4:06 am

Bengt Abelsson says:
I have reasons to belive that most good-sized turbines works at more than 94 – 95 % efficiency.
SAYS THE MANUFACTURER!
The efficiency is measured on how much space around the housing that is needed for the turbine to turn. Not on ACTUAL ENERGY efficiency it picks up on the blades.
Actual energy efficiency is less than 2% for any turbine. The efficiency actual is worse, the faster it rotates. If you rotated a turbine fast enough, even on an airplane prop, no molecule of energy will touch it as it has created it’s own barrier of space.
There are a few factors to a turbine technology that make this design deflect more energy then what is actually picked up by the blades. It uses a whole circle of space in rotation. Any energy in that space MUST be counted as it is energy going through.
There are many other factors that comtribute but this gets complicated to explain.

September 16, 2010 4:35 am

Why is someone who has no remote knowledge of energy posting on WUWT? Everything Thomas Fuller states about renewable energy is based on emotional rhetoric and has nothing to do with reality.
I highly recommend reading the following books, something Mr. Fuller clearly has never done,
The Bottomless Well: The Twilight of Fuel, the Virtue of Waste, and Why We Will Never Run Out of Energy (Peter Huber, Ph.D. Mechanical Engineering, MIT, 2005)
Power Hungry: The Myths of “Green” Energy and the Real Fuels of the Future” (Robert Bryce, 2010)
The Solar Fraud: Why Solar Energy Won’t Run the World, Second Edition (Howard C. Hayden, Ph.D. Professor Emeritus of Physics, 2005)

Gail Combs
September 16, 2010 4:36 am

Tom Fuller says:
Hi Gary, your surprise is touching… It’s not faith in government, it’s faith in us to use it wisely that is the liberal fever that has touched (not torched… c’mon…) my brain.
_________________________________
Brian H says:
Nah.
“If one rejects laissez faire on account of mans fallibility and moral weakness, one must for the same reason also reject every kind of government action.” Ludwig von Mises – Italian Economist 1881 – 1973
___________________________________________________
How very correct. And I will match that with another quote:
“The urge to save humanity is almost always only a false face for the urge to rule it.” – Henry Louis Mencken (1880-1956)
The liberals (Democrats) here in the USA gave us Central Banking and “legalized” counterfeiting money by the banks – the Federal Reserve Bank.
Ludwig von Mises explained how every time more counterfeit (fiat) money is printed it moves wealth from the little guy to the bankers.
“No government agency or committee can design and operate a monetary system that would avoid the problems associated with wealth redistribution from those who gain access to new money late in the process to those who gained access early.” Source
This does not include the wealth transferred to the bankers when the government borrows non-existent money from the Federal Reserve to pay for another “Socialist do-good program” and the bankers require the tax payer to pay them back that amount and interest from their productivity.
It is no coincidence the Income Tax came into being at the same time as the Federal Reserve, that the 10% cap was not put in the amendment or that the Grace Commission report to President Reagan showed 100% of my taxes ends up in the pockets of the bankers.
If you are a socialist you are supporting “wealth redistribution” alright – the redistribution of the poor mans productivity into the criminal bankers pocket who does nothing more productive than write a number in a ledger creating fiat (counterfeit) money out of thin air. That is what the whole credit card system is and why bankers try to hook kids in college on credit cards.

Bengt Abelsson
September 16, 2010 4:41 am

I was ( as Mr Fuller) talking of hydro turbines, Gas turbines are of course quite different.
James B Francis is the inventor (1849) of the Francis turbine, with 90 % mechanical efficiency.

September 16, 2010 4:48 am

Tom Fuller as the SMP (Savvy Media Professional) who consistently intrudes an AGW message on this website, and other comments like that.
What a beautiful glimpse in the conspiratorial mindset.
Thanks for the laugh!
Julian Braggins,
Thanks for updating me that basic physics, discovered over 150 years ago, is not valid anymore. I’m sure planet Venus will set her temperature back by a few hundred degrees to become in accordance with the new scientific discoveries that are reported here.

Gail Combs
September 16, 2010 5:00 am

Tom Fuller: September 15, 2010 at 9:32 pm
Dr. Bill, I confess I don’t understand…
___________________________________________
dr.bill says: September 15, 2010 at 10:21 pm
Tom, I will be perfectly candid…..
________________________________________________
Dr. Bill,
Thank you for clearly stating what many of us had sensed but were unable to say clearly. Tom Fuller is a very clever Spinmeister. One wonders if he is paid to spread his insidious poison.
If he is I am sure it is covered up quite well. Just like Rep (D) Rosa Delauro – sponsor of “the Food Safety bill” HR875 – was paid through her part ownership of her hubby’s privately held company that did consulting work for Monsanto.

Gail Combs
September 16, 2010 5:06 am

Julian Braggins says:
September 16, 2010 at 1:49 am
You may well hold on to long established ‘ facts’ of CO2′s absorption and emission of IR, but it may be that you haven’t kept up with the science of it in atmospheric conditions….
Quoting, “Again, calculating the epsilon (emissivity) for the atmosphere for an old and new value using atmospheric absorption from the Hitran database results in a negative result when the new emissivity is applied. That means the temperature drops because the radiation output of the atmosphere becomes more efficient with the new increased emissivity.”
So you may be worrying about nothing
____________________________________________
And the new findings are just in time to blame CO2 for “Global Cooling” leading to a possible Ice Age….
Oh NOooo we are all going to die, We must regulate CO2 NOW….
Hand me your wallet.

Joe Lalonde
September 16, 2010 5:11 am

Bengt Abelsson says:
September 16, 2010 at 4:41 am
Mechanical efficiency and Energy transfer efficiency are two completely different things.

Jimash
September 16, 2010 7:09 am

” I’m sure planet Venus will set her temperature back by a few hundred degrees to become in accordance with the new scientific discoveries that are reported here.”
I suggest that the comparison to Venus be named for the absurdity that it is, just as many disingenuous and provably irrelevant arguments are named in certain precincts.
I, for one, am tired of having my feeble intelligence insulted with this kind of
ridiculous fear mongering.
Dr. Verheggen seems to be very fond of calling out these fake stalking horses of the
climate-scare crowd.

September 16, 2010 7:48 am

“…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…”
Actually, Bart is a bombastic finger-wagger, a sputtering dogmatist who never met an abstract noun he didn’t like. But I don’t mind him. He’s on the level, and clearly believes what he says. It’s the twisty, shifty, accomodating types who bother me.
“And be these juggling fiends no more believed,
That palter with us in a double sense…”
– Macbeth

September 16, 2010 8:21 am

The consensus opinion is indeed that climate disruption is approximately proportional to cumulative CO2 emissions. Whether it is right or wrong, I suppose, will continue to be a topic in these parts. But you all might as well at least understand what we think is going on. That means, as Bart says, that reducing CO2 emissions earlier has a bigger payoff than reducing CO2 emissions later. So we should look at what has the most long-term integrated effect that we can do now.
From the Tobitian perspective, I hope INGSOC will forgive me but INGSOC is absolutely right about this: persons living in rural areas should be excused from carbon emissions incentives connected to transportation. This complicates matters and has some perverse edge effects. Specifically, if care isn’t taken will cause outward population pressures at metropolitan fringes,. But such effects already exist (where there are city taxes on gasoline, e.g., Chicago, DC) and are not dominant.
If we ignored transportation altogether and simply let prices rise with oil scarcity and international demand, the carbon picture would change very little. So all this paranoia about getting to the grocery in West Bug Tussle is entirely beside the point.
The main issue is the production of new coal infrastructure in heavy industry and in electric power. If there were no new coal plants and gradual phaseout of existing ones, and presuming no new major greenhouse sources, we’d have bought decades to work out the details of whether further regulatory intervention were needed and how to do it.
Unfortunately, since the weird science of WUWT has infected the Republican party, the democrats are forced to draw upon coal states to come up with initiatives. Consequently those initiatives make no sense whatsoever. I am glad Waxman-Markey went down but there’s little prospect of anything different, and little prospect of pressure on China working until there’s progress in the US. If you guys confidence in your contrariness is wrong, you’ll have done a lot of damage.
Personal sacrifice is almost pointless. Talk of socialist ulterior motivations is pointless. The main regulatory action needed urgently is to stop building new coal plants. Meanwhile we should go after secondary greenhouse gases and black carbon. After that we can talk. If y’all’s weird science prevails in the course of normal science, we can uncork the coal again and things will be even better. It isn’t the IPCC consensus side that is catastrophizing.
It’s not about your car or your freedom. It’s about coal.

September 16, 2010 9:07 am

Michael Tobis,
The “weird science” you’re ranting about is simply psychological projection. The deluded idea that a tiny trace gas is the primary driver of the planet’s temperature is believed with the same gullibility with which Mrs Keech’s true believers swallowed her predictions about the imminent arrival of the flying saucers.
And if coal plants are the problem, you might recover a teensy bit of credibility by going on the warpath against China, which is building 2 – 4 new coal-fired power plants every week, instead of always trying to lay the blame on one of the cleanest, least-polluted countries on Earth.
The trait common to all eco-wackos is hypocrisy.

Bengt Abelsson
September 16, 2010 9:58 am

Mr Lalonde, Mr Fuller claims that hydro turbine efficiency is increasing 1% per year.
I am asking for source for that claim.
As a tip, I state that the francis turbine from 1849 then achieved 90 %.
This is, I belive, not the proper thread for detailed turbine discussions.

Curiousgeorge
September 16, 2010 10:41 am

Michael Tobis says:
September 16, 2010 at 8:21 am
…………………………………….
It’s not about your car or your freedom. It’s about coal.

So I guess you are in agreement with John Holdren that “de-developing” the USA would be a good thing? Hmmmm.

a jones
September 16, 2010 12:03 pm

Bengt Abelsson says:
September 16, 2010 at 9:58 am
Mr Lalonde, Mr Fuller claims that hydro turbine efficiency is increasing 1% per year.
I am asking for source for that claim………..
Quite so. You are essentially correct. Water is effectually incompressible and by the 1880’s there were many designs for larger pressure head turbines whose manufacturers usually claimed and indeed generally achieved efficiencies of around 90%, a Pelton wheel of course can do rather better than this. All such claims ignore losses in the supply line which are also usually small and the effects of throttling the flow to reduce output but again if well designed the losses are small.
By comparison the typical claim for hydrostatic drives is 99% efficiency but the reality allowing for the usual losses etc. is generally closer to 95%.
So there is not much room for improvement as it were.
Kindest Regards.

September 16, 2010 1:44 pm

I am wondering if Poptech has ever wondered why someone who has no remote knowledge of climate is posting on WUWT?
REPLY: I’m wondering why so many people listened to Al Gore, gave give awards, stature, cash, and accolades, when he had ” no remote knowledge of climate”. – Anthony

September 16, 2010 1:49 pm

The problem with Tom Fuller’s posts is this:
Other WUWT article writers post an explanation of the science – while Fuller gives his opinion of events, based on what appears to be ‘post-normal science.’
I think most readers want articles explaining the science, rather than articles expressing someone’s personal opinion.

dr.bill
September 16, 2010 4:02 pm

Smokey: September 16, 2010 at 1:49 pm
The problem with Tom Fuller’s posts is this:…..

You are a kind and forebearing person, Smokey. I would at least amend that to read: “one of the many problems”…..
I have also been wondering about Anthony’s decision to give wTF so much face time on WUWT without at least a PG rating. Perhaps he has just been testing us. If so, he’s been successful. I’ve noticed myself becoming very testy. 🙂
/dr.bill

September 16, 2010 4:04 pm

Umm, Smokey, I think the problem is not me giving my ‘opinions’, but the nature of those opinions.
The posts currently up on WUWT above mine are:
Gavin to attend “we shall overcome” seminar
The morphology of “global warming”
Climate Craziness of the Week – Attention citizens! You Are Thinking The Wrong Thoughts
Engelbeen on why he thinks the CO2 increase is man made
Study: Glaciers help build mountains
Hump day hilarity – better skiing through homogenization
They only come out at night: “The Dark Side of Climate Change”
NOAA’s sea ice extent blunder
McKitrick: Understanding the Climategate Inquiries
First Mover Disadvantage
Now, honestly, less than half of those are about science. I learn about science here as well as elsewhere, and I like many of the posts that are not about science–like McKitrick, which I think is a great post.
But this site carries a lot of opinion pieces as well as science. Don’t you think?

Joe Lalonde
September 16, 2010 7:26 pm

a jones says:
September 16, 2010 at 12:03 pm
So you are stating as fact that EVERY molecule of energy except 5% touches and moves a turbine blade with NO deflection or interference in the angles of the water hitting the blades? In that whole circle that the turbine turns in, all that energy is efficient in the current design of turbines.
Efficiency is having every molecule of energy working together and in the current design, it is made for BULK water harvest and not individual molecule efficiency.