The report of the latest “Bloomberg New Energy Finance” (BNEF) annual summit in New York proclaimed on April 14, 2015 that fossil fuels had already lost the race against renewables. “The race for renewable energy has passed a turning point. The world is now adding more capacity for renewable power each year than coal, natural gas, and oil combined. And there’s no going back.” The report by Tom Randall, published on the Bloomberg Web site, hedged no bets. It touted “the beginning of the end” for fossil fuel. The trends and forecasts clearly indicate a slow death for the buildout of new oil, gas, and coal fired energy capacity as “clean energy” capacity surges ahead over the next fifteen years. End of story? Well, not quite.
Not surprisingly, the Bloomberg forecast includes nuclear power in the clean energy category. Nuclear power advocates never do count the high environmental costs of uranium extraction, equipment manufacturing, or facility construction involved in nuclear installations. Not to mention the fact that the risks of nuclear power generation make such installations uninsurable unless the insurance is subsidized and guaranteed by the federal government. That is precisely because of the catastrophic proportions of a reactor meltdown and other risks. Nor do they consider maintenance and repair costs or the massive expenses associated with decommissioning worn out facilities. Issues of storing the growing backlog of nuclear waste and its risks remain chronically unresolved. What’s clean about that?
At least the Bloomberg report implicitly acknowledges the complexities and time involved in building out nuclear energy capacity. It shows future nuclear buildout as rather small compared to that of new solar and wind capacity. However, we should also be concerned about the Bloomberg forecast for new gas-fired energy capacity. From 2015 to 2030 it is forecast to slow only slightly. Most new gas production results from fracking, with the result that total carbon emission is at least as bad as that for coal. The methane leaks alone should make it an unacceptable technology. So should the demonstrated damage to critical aquafers. What’s clean about that? But wait, there is so much more.
New Economics of Energy Production
As we all know by now, the prices of wind and solar power continue to plummet, making them economically competitive with fossil-fuel sources. But the political economy is never that simple. Unfortunately, our future is not just about making rational decisions based on the evidence at hand. The myth of renewable energy sources being uncompetitive continues to be promoted, even by Bill Gates, who should know better. Entrenched corporate interests of investor owned utilities as well as the fossil fuel industry constitute a major drag on progress in converting energy production to low-emissions technologies.
Big investor-owned utilities continue to resist conversion to solar and wind sources of energy; their policy and planning criteria do not include the public interest. Distributed solar photo-voltaic generation by residential and business customers is a threat to their monopoly power. They resist any loss of financial control of the energy markets over which, unfortunately for the public, they have been given legal monopoly power. The euphemism, “public utility” becomes absurd. They operate to maximize the guaranteed monopoly profits from expanded investments. The larger the investment, regardless of public need, the larger the profit. Nevada and New Mexico present particularly nefarious cases of obstructionism by investor-owned utility companies. Public utility “regulation,” agencies have failed to serve the public interest. They are embarrassingly compliant with the demands of the utilities they are supposed to oversee in the public interest. Energy is in its nature part of the nation’s commonwealth, but it is treated by “regulatory” agencies primarily as a legitimate source of private corporate profit.
In Nevada, NV Energy Inc., controlled by Warren Buffet’s giant holding company, Berkshire Hathaway, was successful in its heavily funded political campaign to dismantle the state’s net metering policy. Forty-two states have offered some form of net metering for residents who install solar panels to produce most of the electricity they use and “reverse meter” any surplus back into the grid. Many are now under attack. Nevada’s elimination of its renewable energy credits resulted in 17,000 residents losing the economic benefits of having invested in renewable energy. The move has also cost the state some 8,000 solar jobs.
In New Mexico, Public Services of New Mexico (PNM) has been engaged in a public foot dragging exercise with regard to transitioning to renewables. It has received implicit and sometimes explicit support of most of commissioners on the state’s Public Regulatory Commission (PRC). PNM operates coal fired energy generating plants in the four corners area, where lung diseases and cancer – along with poverty – run rampant among Navajo residents. The Four Corners methane plume has been observed by orbiting satellites. Federal emissions requirements have led PNM to propose closing one of the obsolete coal-fired generators. But for their own financial reasons, PNM would keep the other operating, then “review” its continuation a few years down the line. Even if it were decommissioned after that review, the process would probably take a few more years before its environmental damage could be stopped.
The PNM plan also includes new long-term coal and nuclear commitments. Thus, the state of New Mexico and its people would be bound to continued high levels of carbon emissions and potentially huge legal liabilities resulting from PNM’s nuclear deal. A trivial gesture of adding little solar and wind capacity is also included in the plan. All but one of the commissioners either have engaged in behavior that any ethicist would call, at minimum, an “appearance of impropriety,” or have publicly indicated their political support for PNM prior to reviewing the case. The commission voted to approve the plan. Only one environmental group, New Energy Economy, has made serious attempts to stop the regressive proposal from being realized. The rest were coopted in secret negotiations with PNM and some state officials.
Renewable Energy Is Not Enough
The Bloomberg report rightly concludes that it “is no longer a matter of if the world will transition to cleaner energy, but how long will it take.” Therein lies the rub. Finance is a very big problem, and it is acknowledged by the BNEF report. Hundreds of billions of dollars are needed each year to finance just the amount of new renewable energy capacity sufficient to theoretically hold global warming to the demonstrably inadequate benchmark of 2 degrees Celsius. Each year from 2008 to 2014, a decreasing proportion of the increasing billions in needed capital has been applied to new renewable energy buildout. The International Energy Agency (IEA) forecasts a decline in new capacity from 2014 to 2020, or a paltry increase under an optimistic “accelerated case” scenario. Meanwhile, we find out that methane emissions, 90 times as potent a greenhouse gas as CO2, have been undercounted for a long time. The Environmental Protection Agency has drastically increased its estimates of methane emissions in its draft 2016 Greenhouse Gas Inventory.
In all this, we find almost no public discussion of conserving energy and reducing waste. New scientific reports of accelerating climate-disruptive effects of global warming keep surfacing. For example, a new report from the University of Cambridge concludes that 78% of remaining wetlands will be wiped out by sea level rise this century. Many of the world’s great cities are on coastlines. Like island nations and delta populations such as those in Bangladesh, they too are at direct risk from rising seas. The result will be mass migrations forced by flooding. Yet, climate action rhetoric continues to be not only inadequate but is also in direct conflict with government economic policies of most nations. The continued promotion by all governments of economic growth of the only kind we have known is a sure path to defeat of any climate action. Only by curtailing growth, combined with energy conservation and suppressed consumerism, will we have a chance to restrain global warming enough to avoid catastrophic climate collapse. Then renewable energy can be part of a real solution. Yet the denial implicit in the omission of conservation and growth reduction from national and international policy discussions continues.
The Great Transformation or Collapse
The public policy priority of almost every nation remains on finding ways to stimulate economic growth, without any reference to the climate consequences. Some important non-conventional economists and others have pointed to the ultimate futility of a never-ending-growth economy: it will end. The accelerated warming of the earth is repeatedly documented in data released by NASA and other scientific sources. Despite the increasingly urgent situation, establishment politicians and economists are not listening. Even so, public awareness that the growth economy must be replaced by an ecological economy – on a planetary scale – is expanding. But nobody knows how to make the transition to zero-carbon/zero-growth ecological economics. Economies must now be developed ecologically, not grown further in the mode of conventional economics. That may be the most complex difficult challenge ever faced by humanity; nothing like it has ever been tried before – its scope is planetary and its urgency is absolute.
Such a complete transformation of national economies and indeed the global economy is an entirely unprecedented prospect. Most unfortunately, this transition must be made very quickly to avoid the gravest consequences of continued industrial civilization as we have it. The focus of every nation’s politicians, economists, and sociologists must be shifted one hundred and eighty degrees to developing strategies to radically transform the global economy. The prospects for widespread chaos are very high, even under conditions of maximum international cooperation and planning. Failing to achieve such a great transformation, we will join the sixth great mass extinction.
It is necessary to face the fact that the transition to an ecological economy will only be achieved by a radical transformation of society itself. The transition to renewable energy production technologies, important as it is, will be only a small part of the necessary New Great Transformation of the global political economy. Far less energy production than the industrial leviathan requires must support a far more constrained consumer economy than we have known.
We face a very hard choice: Best case is a massive social and economic transformation of society that may reduce emissions enough to avoid cataclysmic climate collapse. The ‘alternative’ case is the more likely modest conversion to renewable energy production with the industrial growth machine essentially in place – that would produce full-on climate chaos and societal collapse. Many who recognize the dangers of global warming still cannot wrap their minds around this reality. An ecological society cannot be a mass consumer society; it must hone in on the most essential and meaningful relationship to the natural world and shape social relations and economic behavior to fit that relationship. That will be far more comprehensive than Bernie’s political revolution. It will be a social revolution.