From Stanford University comes another head exploder for Joe Romm.
IMAGE: In the fast-globalizing clean-energy industry, the US should press its advantage in engineering, high-value manufacturing, installation and finance, writes Stanford researcher Jeffrey Ball.
America’s approach to clean energy needs to be reformed if it is to meaningfully affect energy security or the environment, according to two new articles by Stanford writers.
The debate over how to fundamentally change the world’s massive energy system comes amid taxpayers’ $500 million tab for the bankruptcy of Fremont, Calif., solar company Solyndra, the global recession, government budget cuts and plunging U.S. prices for natural gas. Making the change cost-effectively will be crucial, write Jeffrey Ball and Kassia Yanosek, both based at Stanford University’s Steyer-Taylor Center for Energy Policy and Finance.
Ball, scholar-in-residence at the Stanford center and former energy reporter and environment editor for the Wall Street Journal, writes in the current edition of Foreign Affairs that the world’s renewable-energy push has been sloppy so far. It can be fixed through a new approach that forces these technologies to become more economically efficient, he writes in the article, “Tough Love for Renewable Energy.”
“It is time to push harder for renewable power, but to push in a smarter way,” Ball writes.
Kassia Yanosek, entrepreneur-in-residence at the Stanford center and a private-equity investor, writes in Daedalus, the journal of the American Academy of Arts and Sciences, that attempting to accelerate a transition to a low-carbon economy is expensive and risky. Policymakers, says Yanosek, need to realize that achieving a transition with government-aided commercialization programs will require putting billions of taxpayer dollars at risk, often in a high-profile way.
“If government officials wish to accelerate the next energy transition, they will need a different strategy to develop an industry that can survive without major subsidies, one that prioritizes funding to commercialize decarbonized energy technologies that can compete dollar-for-dollar against carbon-based energy,” Yanosek said.
With natural gas prices so low due to huge new supplies of shale gas, besting the current energy system has become tougher.
Reinvention, not rejection
Ball writes that governments and investors have spent big money on renewable power, slashing the cost of many renewable technologies and creating jobs. And yet, he notes, modern renewables remain a very small percentage of the global energy mix.
“Wind and solar power will never reach the scale necessary to make a difference to national security or the environment unless they can be produced economically,” he writes. “The objective is not wind turbines or solar panels. It is an affordable, convenient, secure, and sustainable stream of electrons.”
Taken together, the analyses by Ball and Yanosek argue for driving down the costs of key technologies and speeding up their deployment, said Dan Reicher, the executive director of the Steyer-Taylor Center, launched a little more than a year ago at Stanford Law School and the Stanford Graduate School of Business.
“This will require the right mix of targeted government policy and hard-nosed private sector investment,” said Reicher, also a Stanford law professor and business school lecturer, and formerly an assistant U.S. energy secretary and private-equity investor.
Ball, in Foreign Affairs, writes that rationalizing “the conflicting patchwork of energy subsidies that has been stitched together over the decades” is essential. Supporters of renewable energy point out that public subsidies for these technologies are a fraction of those for fossil fuels, both globally and in the United States. Realistically, Ball figures, subsidies should be examined not just in total dollar amounts, but also per unit of energy produced. This more apples-to-apples comparison would help foster an honest debate about which subsidies best promote the type of energy system countries want.
Also key to America pursuing clean energy in the most economically efficient way is for the country to exploit globalization rather than fight it, Ball writes. Despite mounting trade-war tensions with China over wind and solar power, he writes: “If the goal of the renewable-power push is a cleaner, more diversified power supply, then low-cost solar equipment, from China or anywhere else, is a good thing.”
In the fast-globalizing clean-energy industry, Ball writes, the United States should press its advantage in engineering, high-value manufacturing, installation and finance. “Much of the machinery used in Chinese solar-panel factories today is made in America,” he writes. Installation remains a domestic business, and the U.S. financial system allows homeowners to install rooftop solar panels at no upfront cost. Ball notes that two other energy shifts will be at least as important as renewable sources: cleaning up the process of burning of fossil fuels, which provide most of the world’s energy; and using energy from all sources more efficiently.
Nevertheless, Ball writes, America’s renewable-energy tax credits need to be changed. He and Yanosek agree the current credits have contributed to an inefficient, boom-and-bust approach to renewable energy.
Yanosek writes that smarter government polices could help innovative technologies overcome what she describes as the main financial barrier – the “commercialization gap.” To do this, though, politicians and taxpayers must realize that government efforts to help accelerate an energy transition will require massive and risky investments, she says. A project like building a next-generation nuclear power station or a new type of utility-scale solar thermal plant can require hundreds of millions, or even billions, of dollars.
The commercialization gap
After developers show that new technologies can work in prototype, they often cannot get the backing of traditional investors to build the first commercial project because the risk/return profile is not attractive to private investors, writes Yanosek, who invests in the energy sector at Quadrant Management. Such projects require more money than venture capital investors are willing to bet. But, says Yanosek, the risks of failure in such first-time projects are too great for private equity funds or corporate balance sheets.
If policymakers decide that funding commercialization is a priority, Yanosek’s article provides a roadmap for government support. First, limited public dollars would be best spent moving a bunch of promising new technologies to the next stage.
That leads to Yanosek’s next rule of the road: Government clean energy technologies must not become hostage to stimulus spending and job creation objectives. The legitimate beneficiaries of commercialization-gap support are promising but unproven technologies with no steady revenue stream. They have the potential for cutting prices, but by nature are not likely to ramp up employment significantly until after they have successfully crossed the commercialization gap.
Loan guarantees in many cases are not the best structure for funding companies that push the boundaries of cost and efficiency, Yanosek argues. Instead, the government should invest equity and thus profit proportionately when a beneficiary succeeds, setting up a revenue stream for continued funding. The funding body, furthermore, should take advantage of private-sector expertise and maintain independence from the Department of Energy, where awards can be slow in coming and may be politicized.
Ultimately, Yanosek says, policymakers and taxpayers must embrace the incremental advances and understand that there will be failures along the way. For government to push an energy transition faster than the historical pace, it cannot remove the steps, but only hope to take them more quickly.
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Supporting R&D is one thing but forget this subsidy nonsense.
Obama’s Epic Green Fail
http://www.americanthinker.com/2012/04/obamas_epic_green_fail.html
Excerpt:
…what has actually happened since Obama took office.
• SunPower, after receiving $1.5 billion from DOE, is reorganizing, cutting jobs.
• First Solar, after receiving $1.46 billion from DOE, is reorganizing, cutting jobs.
• Solyndra, after receiving $535 million from DOE, filed for bankruptcy protection.
• Ener1, after receiving $118.5 million from DOE, filed for bankruptcy protection.
• Evergreen Solar, after receiving millions of dollars from the state of Massachusetts, filed for bankruptcy protection.
• SpectraWatt, backed by Intel and Goldman Sachs, filed for bankruptcy protection.
• Beacon Power, after receiving $43 million from DOE, filed for bankruptcy protection.
• Abound Solar, after receiving $400 million from DOE, filed for bankruptcy protection.
• Amonix, after receiving $5.9 million from DOE, filed for bankruptcy protection.
• Babcock & Brown (an Australian company), after receiving $178 million from DOE, filed for bankruptcy protection.
• A123 Systems, after receiving $279 million from DOE, shipped some bad batteries and is barely operating. It cut jobs.
• Solar Trust for America, after receiving a $2.1-billion loan guarantee from DOE, filed for bankruptcy protection.
• Nevada Geothermal, after receiving $98.5 million from DOE, warns of potential defaults in new SEC filings.
And that’s a partial list. Can Obama and the DOE pick ’em, or what?
“Realistically, Ball figures, subsidies should be examined not just in total dollar amounts, but also per unit of energy produced. This more apples-to-apples comparison would help foster an honest debate about which subsidies best promote the type of energy system countries want.”
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Here in the United States, the “country” is supposed to answer to it citizens.
Just an FYI.
It looks like a good, well-thought out article, and echoes a lot of what I’ve been saying in the same general context. Carbon taxes and the like are nonsense, especially given the lack of urgency suggested by 12 years or more of level temperatures and a sound physical mechanism connected to impeccable data that explains at a level even most warmists can appreciate why they’ve been level and why they might be expected to actually descend, at least in the short run. At the same time, as the article notes, what the world needs is a “dependable, safe, economical stream of electrons”.
I personally think that it is peachy keen for the US to fund all sorts of research into the basic science and technology that will eventually make the “problem” of carbon go away (whether or not you think that it is a problem). Eventually will almost certainly be soon enough because although the GHE will almost certainly add differential warming to whatever the natural temperature of the planet might have been without it, there is little evidence of a runaway positive feedback catastrophe leading to boiling oceans and other hyperbolic nonsense. Will another 1 to 1.5 C of warming cause catastrophe? Unlikely, but perhaps it would be better to avoid it if we can, and inside 20 to 30 years we can and will, not because of panic-driven political action but because non-carbon based energy resources make economic sense. There are many things being looked at that might bring this about far sooner, actually — I’m hoping to go to a colloquium talk at Duke this upcoming week on the physics of inexpensive selective filter and lens panels that could basically increase the cost-efficiency of solar cells by as much as an order of magnitude right away — think “Fresnel Lens”, but one that selectively focuses only the useful wavelengths to minimize heat delivery and maximize light delivery. And Anthony has already published top articles on things like developments in zinc-air cells (and not published related articles on lithium-air cells) that, if they come to fruition, could increase the energy storage capacity of batteries by an order of magnitude or more without memory effects.
To put it another way, science and engineering are ultimately both our source of future wealth (if one doesn’t buy the CAGW scenario) or our salvation (if you do) — either way, they are the key to having our cake and eating it too, maintaining civilization while no longer mining out ever more carbon to burn. In the long run, well-done science will even answer the questions about just how the climate does work, maybe, if the answer is within our computational and evidence-based grasp yet.
Research of this sort almost always pays off even if it is in unexpected ways. Speaking as one who goes through some 2-3 complete replacement batteries in the lifetime of his primary laptops, I find the memory effect and relatively low power storage rates of current commercial-grade batteries to be enormously expensive and annoying. Give me a laptop that runs for a full day on an hour’s charge and that can stand 10,000 charge cycles and I’d be very happy indeed quite independent of all of the other huge benefits to this sort of technology.
Perhaps this is the sort of thing that can produce a rare consensus between climate skeptics and CAGW warmists. Carbon taxes and sequestration measures are economically absurd — even the warmists acknowledge that they won’t do the job (if you catch them offguard and ask it in a way that gives them an excuse to tell you about all of the other draconian interventions into personal freedom that will be required:-). To solve the “problem” of too much CO_2 in the atmosphere will require serious advances in science and engineering, this is one place where government funded research makes sense and has historically been productive of some of the best ideas and products the world has ever seen. Adding some economists to the mix wouldn’t hurt as well, as cost-benefit analysis has been sadly lacking throughout.
Anyway, lovely article.
rgb
Some say the US is “broke”. But don’t they recognize the US Government will have to somehow come up with over $15 Trillion just to get BACK to “broke”?
Apparently not.
The Greenies also omit how much environmental damage is caused mining the rare earth materials needed for batteries or the fact that most of the miners are virtually slaves of their ChiCom overlords. Although I think quite a bit comes from Canada, the same country who we won’t buy tar sand oil from. Greeney-weenies are either staggeringly dumb or evil, I’m not sure which it is yet.
Still this ‘fixation’ (navel-gazing) on eliminating the use of carbon-based fuels with a vaporous ‘fix’ relying on some nebulous government-backed ‘tech’ solution; this will still not end well (anymore than it has been successful TO DATE dating back to the efforts inaugurated during the CARTER ADMINISTRATION) …
Paraphrasing: “Those who do not learn from history are doomed to repeat it.” -G. Santayana
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polistra says:
May 2, 2012 at 10:59 am
Cheapest way to “push harder for renewable power:”
STOP TEARING DOWN THE DAMN DAMS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
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Have any of them even mentioned hydopower? It has a proven track record. I’m sure there a plenty of dams that could be retrofited with turbines …. and when’s the last time a dam went bankrupt?
There was a great book published in the UK many years ago called “Plain Words” by Sir Earnest Gowers. I tried to follow its lessons for years. I often found that when I had removed all the fancy words and complex sentences that, in fact, I had very little of value to say.
I recommend that book to the authors of this report.
Why on earth would we want to double down on stupid? Wind and solar are proven losers. How much more failure do we need to see? The authors state, ‘Ultimately, Yanosek says, policymakers and taxpayers must embrace the incremental advances and understand that there will be failures along the way. For government to push an energy transition faster than the historical pace, it cannot remove the steps, but only hope to take them more quickly.”
Incremental advances will leave us with a litany of useless sources of unreliable, and expensive energy. they continue…
More stupidity. How do they imagine weaning ourselves off of fossil fuels? In what fantasy land can this occur? There are no batteries large enough to operate substations of any size. This means to withdraw from the grid and have the batteries for home use….. and that’s fine for a home. Now operate a huge auto manufacturing plant….. or our huge office buildings in the cities. What battery is invented to facilitate this? It isn’t going to happen. So, back to the hodgepodge of useless “alternative energy” solutions. Finally, the authors used the word efficient or a derivative 5 times. There is no “efficient” solution by embracing these toys. Not on the grid and not economically. But, that’s understandable, because their understanding of “efficient” is different than rational people.
Click here for the two competing views of efficient. An Alarmist Version of Efficiency
A huge problem in the logic of the article is demonstrated in the quote Jim cited just above me:
‘Policymakers, says Yanosek, need to realize that achieving a transition with government-aided commercialization programs will require putting billions of taxpayer dollars at risk, often in a high-profile way.”
This is very wrong-headed. An intelligent policy would emphasize evolutionary, not revolutionary development. For example, there are several recent-generation nuclear power plant designs which are far safer than those currently in use. Another would be investing in new refinery capacity in the US. It should also offer prizes (as suggested by Jerry Pournelle) for “firsts,” such as the first commercially viable solar power satellite, or fusion power plant. Prizes can be quite economic in that funds are only spent in the case of demonstrated success, as opposed to Solyndra-style fiascos, or the decades-long dependence of wind generators on government subsidies.
“Such projects require more money than venture capital investors are willing to bet. But, says Yanosek, the risks of failure in such first-time projects are too great for private equity funds or corporate balance sheets.”
If private equity wont invest in it, then it’s probably not a good investment.
I think I can, I think I can, I think I can, ……………..
As I said before, don’t send your kids to Stanford.
What a piece of crap.
Renewable power as we know it today sucks. Period
“Loan guarantees in many cases are not the best structure for funding companies that push the boundaries of cost and efficiency, Yanosek argues. Instead, the government should invest equity and thus profit proportionately when a beneficiary succeeds, setting up a revenue stream for continued funding. The funding body, furthermore, should take advantage of private-sector expertise and maintain independence from the Department of Energy, where awards can be slow in coming and may be politicized.”
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Yanosek is essentially stating the US Government should have a “funding body” that acts as a venture capital/private equity firm. Not surprising given Yanosek’s background. There are tremendous problems with this, for example, even more state owned businesses. Then again, given our government’s inability to pick winners the net result is likely the loss of money just like the loan guarantees.
Oh didn’t you get the memo? Hydropower is no longer green becuase.. well.. because it works I guess. They’ll blather on about modifying eco systems or killing spotted pond scum or something, but if beavers can get away with it why not people? Because it isn’t about being “green” it’s about limiting the options of Americans and imposing the will of a Socialist Elite Oligarchy who “knows what’s best”. How best to impose your will on the masses? Limit their mobility and increase their dependency on the government by regulating anything that can be regulated.
majormike1 says:
May 2, 2012 at 12:05 pm
That is a nicely succinct summary of why wind/solar will never be major sources of energy, unless we regress back to 18th century per-capita energy consumption rates.
We have more coal/oil/natural gas than we thought we did even 10 years ago. That will carry us for a long time, but not long enough for bureaucrats’ “rationally-determined targeted technologies” to produce any new breakthrough energy source, and certainly not long enough for wind/solar to be viable.
Thermodynamic efficiency for combustion-based electrical generation ranges from around 35% to over 60% depending on the fuel and technology used; improvements are still possible but increasingly less significant. With more of the world’s population expecting the material quality of life an energy-intensive economy enables, we either increase the fossil fuels we burn significantly, or we find new energy source(s) at least one order of magnitude denser than we have now (and plentiful).
None of the so-called renewable energy sources equal the energy density of current fossil fuels, let alone offer any hope of exceeding them. They are therefore a dead-end, only worth exploring as a temporary emergency response to a scarcity of better fuels. Subsidizing renewables in the hope it will spur development beyond the need for fossil fuels is like chopping off your own feet with the expectation it will better motivate you to learn how to fly.
Well the Government, and its Department of Energy, has so far produced not one Joule of energy availability. Well we know they’ve produced no energy, since energy is conserved; but neither have they made any available that wasn’t prior to their interference with the industry. And so far, atom optical trapper expert Steven Chu, has not demonstrated any special skills at making energy available either; even with all the microbes and yeasts at his disposal.
But we MUST “invest” in green energy, becausae of all the millions of green jobs it will create. President Obama says it will, and Nancy Pelosi says it will; many more jobs they claim than the oil industry.
“Invest” in this case means taking MY money (and yours) that I (and also you) planned to invest in something of my own choosing; but instead it will go to “invest” in those millions of green jobs.
Well it has to of course, because I, and a whole bunch of other people am/are not about to “invest” in “green” renewable energy.
The secret is in that claim of those millions of jobs; well of course I believe those claims; which is why I don’t want to “invest” in them.
Hey ! Earth to Obama; Earth to Pelosi; it costs REAL MONEY to pay people to DO JOBS.
If “green renewable” energy was economically viable IT WOULD PRODUCE FAR FEWER JOBS than exist in the petroleum industry it seeks to replace.
Economic progress is made BY ELIMINATING JOBS !!
Now this has typically come about by having free enterprise create entirely new industries and technologies to replace the drudgery jobs that preceded them.
So if Pelosi/Obama et al, are being honest with us that they plan to create oodles of new energy jobs; it stands to reason, that that energy is going to cost more; not less, than existing readily available sources of energy.
curious george says:
May 2, 2012 at 10:48 am
The disadvantage of both wind and solar is that they are intermittent. How about alternatives to burning plants? Imagine a modest pile of hay a cow eats in a day. How far would a car run on that fuel? We need “digestive” fuel cells. Any combustion is horribly inefficient.
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“We need “digestive” fuel cells.” That is the cow/sheep/goat. Take the poop and make methane gas, then eat the cow.
oh, another article explaining how there’s a preferred way to steal – more tough and more love.
the issue is important – what’s the best way to steal the most. (stealing is taken for granted, no pun intended, by all parties)
professional thieves are sharing progressive ideas at all the best universities. but the work of a predator doesn’t stop when he leaves the think tank – he takes it home because it’s not just a living – it is his life.
one afternoon, i watched a stanford professor, who had a few grad students over to his home to indulge their sycophancies and get some manual labor out of them cleaning the yard, bestow upon the malleable minds of yoot his most profound ideology. 3 lines are etched in my memory- the 3 pillars of postmodern subjectivism:
1- there is no such thing as an absolute (the students did not notice he just uttered one)
2- you can’t really know anything because you can’t know everything. (the students didn’t wonder how he could know this.) (a well abused perversion of goedel whose lesson was really “enlarge the freakin context’)
3- reality is a matter of opinion. (the students will eventually understand that supremacy of opinion depends on force and fraud (consensus) rather than truth)
these are the 3 main weapons used to cripple a man’s ability to perform logic and reason.
how well they have worked. not one man in a thousand who won’t swallow that poison with a smile and feed it to his children.
Sun Spot says:
May 2, 2012 at 11:39 am
The biggest problem is the huge subsidies for fighting WARs !!!
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Do you home work first before making such a statement (I also want the USA out of other people’s business BTW)
The bigest chunk of the federal budget is actually PENSIONS. Forbes states: “State and local unfunded pension liabilities and health benefits for retirees” has a gaping range, anywhere from $1.2 trillion-$4.4 trillion, or 8%-29% of GDP. and that does not include the federal pensions (This is not SS or welfare)
For the federal government, 2012 pensions are 16% of the spending while defense is 14% chart
majormike1 says: @ur momisugly May 2, 2012 at 12:05 pm
…..China and India have already taken this route and are investing heavily into research to meet their future enormous energy needs through Liquid Fluoride Thorium Reactor (LFTR) technologies. The US should too, since we developed and tested LFTR successfully over sixty years ago.
Lawrence Livermore Labs are developing SSTAR (small, sealed, transportable, autonomous reactor) http://en.wikipedia.org/wiki/SSTAR that can be installed in neighborhoods (set and forget) and replaced every thirty years. This unit would be even more effective if paired with LFTR.
The future is here, and it isn’t wind, solar, or biomass.
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I already talked to my Energy Coop about installing SSTAR type reactors. The guy at the counter had been to a seminar.
David Larsen says:
May 2, 2012 at 12:06 pm
…..nuke takes 1 million years to become nonradioactive….
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Not for thorium. Unlike uranium, it doesn’t produce plutonium.
More technical info on Small Nuclear Power Reactors from World Nuclear Association
History of thorium reactors: http://energyfromthorium.com/history.html
E.M. Smith’s comment with links (Thorium can be used in existing nuclear power plants)
what is an ‘entrepreneur- in- residence’? If he were a true entrepreneur and put his money were his mouth is and used his entrepreneurial skills to create that of which he writes he may be a little more credible
John from CA says:
May 2, 2012 at 12:22 pm
Supporting R&D is one thing but forget this subsidy nonsense.
Obama’s Epic Green Fail
http://www.americanthinker.com/2012/04/obamas_epic_green_fail.html
…..And that’s a partial list. Can Obama and the DOE pick ‘em, or what?
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What every one seems to forget is that 80% of new businesses FAIL within the first five years. Why the heck should I pay taxes so someone else does not have to take the financial risk I took to start my business? Heck THEY walk away with a pocket full of money even if they go belly up.
I have no problem investing in something like nuclear which has a proven track record of continuous out put of energy, or damns for hydro but forget solar and wind. They are boondoggles from the get go as is biofuel.
First, please note that I am not the lowercase “curious george” that post’s here from time to time.
Second and to the point of this thread, the WHO seems to have a problem with the AGW/Climate Change agenda.
From: GWPF http://thegwpf.org/images/stories/gwpf-reports/goklany-public_health.pdf
” Executive Summary
Global Warming Does Not Currently Rank Among the Top Public Health
Threats
• The World Health Organization (WHO) attributes 141,000 deaths and 5.4
million lost Disability-Adjusted Life Years (DALYs) in 2004 to global warming.
This is only 0.2% of all deaths and 0.4% of the burden of disease (Figure 1;
WHO 2008a, 2009).
• This estimate, however, does not account for the health outcomes that
are the major contributors to the long-known phenomenon of excess winter
mortality (see Table 1).
• Deaths from excess winter mortality in Japan and the U.S. alone (about
159,000 per year) exceed deaths currently attributed to global warming
(141,000 per year) (Table 4).
• WHO analysis indicates that at least 22 other health risks currently outrank
global warming as a global public health threat (based on data for 2004)
(Figure 1; WHO 2009).
• Global warming would exacerbate existing diseases of poverty rather
than create any significant new health risks. More than 99.9% of the
burdens of death and disease attributed to global warming by WHO are in
developing countries (Figure 1, WHO 2009). “