The Inevitable Paradigm Shift: Fossils to Renewables

Over 30 years ago a man by the name of Amory Lovins wrote a paper called “Energy Strategy: The Road Not Taken,” in which he argued that the U.S. required decentralized “soft” energy alternatives to the “hard” conventional fuel sources that have a stranglehold on the economy and encourage nuclear proliferation and global climate change. Today, the U.S. is dealing with the consequences of not heeding Lovins’ warnings and advice. Throughout the U.S., consumers have felt the affects of having an economy dependent upon finite fuel sources, namely oil, nuclear, gas and coal. Each of these technologies require a strong centralized government for their proliferation, are heavily polluting and vulnerable to attacks, accidents and disruptions with supply (especially from embargoes). Furthermore, from a technical standpoint these energy sources are also highly inefficient.

The negative consequences of maintaining present U.S. energy policy are abundant, such as massive electrical grid black and brownouts, cities choking from smog and ozone caused by vehicle emissions and power plant discharges, health affects, acid rain, global climate change resulting in unpredictable weather patterns and the scary specter of rogue states attaining nuclear weapons by shifting their nuclear energy technologies toward more malevolent purposes. The latter has had both quantifiable and myriad externalities as a function of a foreign policy that claims to be benevolent yet belies the true motivation as a need to find supply and reinforce regimes, no matter how brutal and undemocratic, in order to ensure a consistent flow of cheap and abundant oil. To excuse or defend the present policy would be to strip it to the bone to expose it in all its unwholesome irrationality if oil is not truly the underlying militating cause.

The reasons why the U.S. has reached such a formidable point are clear and the problems with conventional fossil fuel sources are numerous. For the most part society no longer questions the consequences of such myopic energy policy but rather asks how this has been allowed to occur and how moving forward we can avoid similar problems. On a point of clarification, “conventional fuel sources” generally refers to oil, nuclear, gas and coal but according to the German Institute for International and Security Affairs, “petroleum is the most important energy source in the U.S.,” and as such will be the predominant focus of this paper. Not only will this paper attempt to document the reasons why we’ve come to such a point but it will also address why renewable energy sources such as wind, water, solar, biomass and geothermal represent clearly better social, environmental and economic alternatives.

Today, U.S. energy policy heavily favors conventional energy producing companies namely oil, nuclear, gas and coal. In fact, the Sierra club has claimed that the Bush administration’s most recent energy policy,

“harms public health, the environment and consumers…. The bill includes exemptions to the Safe Drinking Water Act for oil and gas drilling and the Clean Water Act for construction related to oil and gas development… opens up coastal areas that have been under moratorium for decades to a harmful inventory of oil and gas resources… contains a provision that could be used to disadvantage communities and states that wish to seek redress for contaminated drinking water in any new suits filed in state courts… stacks the deck against having an environmental review of a broad range of oil and gas activities… threatens wildlife and subsistence values of the 23 million-acre National Petroleum Reserve Alaska.” (Sierra Club)

However, while this administration is a strong proponent of corporate welfare and the status quo, one should not assume that it is solely responsible for the energy policy problems that plague our country. The issue has a long history and goes to the fundamental heart of the weaknesses of the U.S. representative governmental system. Moreover, these well financed energy companies are able to disproportionately distort the political process for their own gain and have been doing so for many decades. According to USPIRG, the way in which these benefiting industries are able to craft such policy is really quite simple; they fund politicians favorable to their cause. Once in office these politicians guarantee the industry has access,

“from the point of crafting policy to implementing it. For some rulemaking or legislative efforts, industry representatives are consulted extensively – to the point that their recommendations are sometimes adopted word-for-word in final text of rules or bills.” (USPIRG, 10)

The problem extends much deeper into the bureaucracies of the very agencies tasked with overseeing the industries they’re supposed to be regulating. The examples of the “revolving door” between industry and governmental agencies are abundant and stories of bureaucrats weakening regulations and then shortly thereafter joining the very companies that have gained the most through the degraded executive branch rules are equally easy to come by. In one blatant example, the White House Council on Environmental Quality Chief of Staff, Philip Cooney,

“fought vigorously on behalf of the oil industry’s position that limits on greenhouse gas emissions were unnecessary, going so far as to doctor scientific reports that suggested otherwise. Once his misdeeds were publicly revealed, Cooney left his employment at the White House for a lucrative job at Exxon Mobil, a company that benefited repeatedly from Cooney’s efforts.” (CAP)

Prior to working for the Bush Administration, Cooney was a lobbyist for the main proponent of the oil industry, the American Petroleum Institute. It should also be said that Cooney didn’t posses any scientific expertise whatsoever. Cooney is just one of many in a long line of egregious and unpunished, in fact rewarding conflicts of interests, in agencies of government responsible for overseeing industry.

The conventional energy industry has had other successes in the political realm by legislatively solidifying their competitive positions through the attainment of subsidies, tax credits and favorable regulations. In doing so they have very effectively insured that the fungibility to replace the technological infrastructure and costs to supplant the reliance on their products are exceedingly high. At the same time they have made sure to exclude competitors from enjoying similar forms of corporate welfare, while utilizing heavily financed public relations campaigns to obfuscate the effects of their products from the eyes of the public.

In essence, they have created a very inefficient market whereby investors and consumers cannot adequately gauge the true costs of conventional fuel sources and therefore cannot make informed decisions. For instance, escalating prices at the pump of late have caused a behavioral shift in consumers at least away from gas-guzzling SUVs to more fuel efficient vehicles just as ” U.S. oil consumption declined by 13 percent between 1973 and 1983” (Bailey) also during times of rapidly escalating fuel prices. It only stands to reason that if consumers felt the true costs of the price of gasoline, which according to the estimates of the International Center for Technology Assessment, ranges anywhere from $5.60/gal to $15.14/gal, they may insist upon a new national energy strategy.

The true costs of using fossil fuels to create energy are not only found in the federal and state subsidies and tax credits doled out of U.S. taxpayer pocketbooks to these profitable companies,

“the oil and gas industry will remain by far the largest recipient of federal energy largesse, receiving by some estimates four times the money of the next largest recipient: the nuclear industry.”

Costs are also found in the environmental, health and social costs which “estimates for the total external environmental and health costs associated with petroleum range from $25.5 billion to $267 billion in current dollars.” (ILSR) In addition, there are other unaccounted for economic costs such as those found by the U.S. taxpayer funded military to protect the private assets of energy producers in hostile foreign lands, the Strategic Petroleum Reserve, travel delays, sprawl, insurance, transportation costs, retail prices, etc. These are real costs that are either presently not being directly experienced by the market in the price of fuel and/or are being offset as unspecified taxes and/or being deferred to future generations.

In order to have a fair analysis of a finite fuel source such as oil it is necessary to identify when that resource will reach its peak and its eventual end, to not only gauge its step incline in nominal costs but also to consider the potential social upheaval costs if society were forced to rapidly adapt to a change in its supply. The concept of Hubbert’s peak oil may aid us in this endeavor. In essence, the idea is that peak oil is the point in time when the maximum global production of oil would have been reached. M. King Hubbert, the originator of the theory, first used it to accurately predict peak production in the U.S. in 1965 - 1970. Hubbert’s theory was extrapolated and it has been claimed that the year 2000 would bring the peak of world production followed by a relatively rapid decline thereafter.

It is not necessary to reach the bottom of Hubbert’s bell-shaped curve because whether or not we are already there or not very far off, while debatable, and though the predictive powers of the theory may be in actuality years off from the original estimates, similar repercussions may be experienced prior to reaching the zero-oil point, possibly due to a disruption in supply caused by political instability in one of the many unstable countries that supply oil to the world market. The effects of which may be exacerbated relative to previous periods in U.S. history due to the fact that global demand is rapidly approaching present supply, which a sustained disruption, for all intents and purposes, could potentially render Hubbert’s peak a moot point. In fact, according to Reason Magazine,

“In the mid-1990s, the world had more than 10 million barrels per day of spare production capacity. That figure has fallen to between 1 and 2 million barrels, which means that any significant disruption in supplies can cause prices to soar.” (Bailey)

However distant we are from the peak or trough, the reality is that for every barrel of oil we discover, we use anywhere from 4 to 8 and the disparity is only getting larger with greater demands from developing countries like India and China. While the future may be difficult to predict and supply models onerous in their veracity, the inevitability of the disruption of the flow of oil is 100% and depending upon whether society acts proactively or reacts, the costs for not preparing for this certainty could be unfathomable.

The Alternative

30 years ago Amory Lovins very adequately described how the succeeding 30 years would result if we continued on the same wasteful path. The delays he described have been economically, politically and socially detrimental and while the potential energy-source bridges that Lovins proposed to span the gap between the eventual replacements of conventional fuels may no longer be timely, his fundamental message still resonates. For all the negative detriments that conventional fuel sources represent, alternative renewable energy sources such as wind, water, solar, biomass and geothermal are generally inherently just the opposite; sustainable, highly efficient, cost effective, minimally polluting, work well within the framework of a diplomatic foreign policy instead of a plundering one, are decentralized and require less governmental intervention while not being vulnerable to widespread outages through sabotage, accidents or embargoes. If conventional fuel sources lost the unfair advantages provided them by the corporate welfare state and the market were to take into account the full brunt of their true costs, renewables would be the clear winner.

Whether or not renewables are inevitability or some other yet undiscovered finite form of energy supplants them, the evidence is abundantly clear – fossil fuels should go back to being extinct. It is imperative that the U.S. doesn’t delay action any further, as waiting for the inevitable will be undoubtedly excruciatingly painful. Consider the foresightful words of Amory Lovins written over 31 years ago,

“Yet these kinds of delay[s] are exactly what we can expect if we continue to devote so much money, time, skill, fuel and political will to the hard technologies that are so demanding of them. Enterprises like nuclear power are not only unnecessary but … prevent us…from pursuing the tasks of a soft path at a high enough priority to make them work together properly. A hard path can make the attainment of a soft path prohibitively difficult, both by starving its components into garbled and incoherent fragments and by changing social structures and values in a way that makes the innovations of a soft path more painful to envisage and to achieve. As a nation… we must choose one path before they diverge much further. Indeed, one of the infinite variations on a soft path seems inevitable, either smoothly by choice now or disruptively by necessity later…” (Lovins)

The brilliance of renewables lies within their required common sense applications. As opposed to piping in oil or gas from long distances, traversing thousands of miles after being ripped from the ground with all the efficiency of a one-armed man rowing a boat, communities will have a choice in which renewable energy source is most appropriate to their needs and resources. Herein lies the strength of renewables. If a hypothetical community has an abundance of geothermal energy for instance but lacks sustained periods of daylight or regular wind sources of energy, they would obviously utilize the source most beneficial to their situation without having to rely upon an inefficient, centralized, potentially unreliable external source that doesn’t take into account local desires, resources and needs of the community. In fact, a community could leverage multiple forms of energy to suit their requirements which would have the added benefit of providing additional layers of energy-sourcing redundancy. Layering renewable fuel sources in this manner and the method duplicated throughout the country would insure that as a whole the U.S. would not have one sole source of potential energy failure while investors and consumers alike would benefit from their inherent environmental friendliness.

However, it could be argued that there is an environmental impact at least from the creation of such devices as wind turbines and solar panels and while this may be true in the short term, the prerequisite efficiency necessary for renewables successful application in a residential and/or commercial environment could potentially offset the initial damage. Additionally, recognizing that the use of renewables is typically thought of as requiring a shift in perspective and mindset with the resulting outcome of being more holistic, manufacturing processes and potentially carbon sequestration could further minimize the effects of the manufacturing process.

It could also be argued that the initial startup costs such as those required for solar power are too formidable to lead to widespread adoption. However, communities like Berkeley, California are showing just what is possible when the public driving forces involve not only the political powers but also corporate interests in an innovative, public-private partnership solar loan program, which “reliev[es] homeowners and businesses of the risk and financial burden of the up-front cost.” (TAP) In this scenario homeowners benefit by paying roughly $100 a month for their solar electric and hot water, while the bonds used to fund the project are secured against the value of the home. It’s a powerful example of what it takes to break the back of the status quo.

Looked at from a purely economic standpoint, renewables are by far, perhaps on a magnitude of order 10 times more cost effect than conventional fuel sources. In fact, a joint Greenpeace and European Renewable Energy Council study concluded so much,

“With no change in energy policy, utilities will invest in more than 10,000 new fossil fuel power plants until 2030 worldwide. To supply those coal and gas fired power plants with fuel will add up between today and 2030 to $18.6 trillion, compared to $13.1 trillion in the Energy Revolution Scenario. This means fuel costs in the Energy Revolution Scenario are already 30% lower in the year 2030, by 2050, they are more than 70% lower.” (GREENPEACE/EREC)

An additional and not so incidental cost effective benefit of renewables is their inherent predictability. The odds that the sun is going to rise and that we can predict a sustained wind level at a particular altitude given a certain time of year are much greater than the odds that there will not be another coup in Venezuela that disrupts the flow of oil to the U.S. from one its top four suppliers. Change is a universal constant of the universe and while an argument can be made for the relatively inexpensive nominal costs of oil in the short term, renewables will nearly always provide stable, fixed energy costs for everyone no matter their country of origin – or at least until the sun dies in approximately 5 billion years, water stops flowing and the wind stops blowing.

The path leading the U.S. toward a sustainable future is long and steep. There is no one, solitary alternative to the conventional energy-creating fuel sources in use today. In order for the U.S. to not repeat past mistakes it must take a decentralized strategy that encourages not only paradigm shifts in perspective but also all manner of applicable technical fixes, conservation of resources and various applications of energy efficiency. Whether or not local communities bring about change like the solar loan program underway in Berkley, California or the inevitability of change runs its course to its final destination, ultimately, the will of the people must overcome the weaknesses of the political process and the limitations of the market and their own self-imposed myopia.

Works Cited

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