Over the past week, as Congress dithered over the so-called fiscal cliff and Americans tried to recover from holiday celebrations, three important events occurred in the field of energy and climate that need to be explored in further detail for what they imply about U.S. energy policy over the course of President Obama’s second term. Call them harbingers of things to come.
The first, reported widely, is the crashing of a Shell Arctic drilling platform into the Alaskan coastline during a storm on New Year’s Day. In itself, the accident was a fairly minor affair. Stormy weather, high seas and the inherent difficulty in skippering what is in essence a giant, fragile industrial facility on the open ocean combined to drive the platform, full of diesel fuel and other industrial pollutants, aground in an unpopulated, environmentally sensitive area.
Luckily, no spills have, as of yet, been detected, but the prospect of a repeat of anything like the infamous Exxon-Valdez incident or the recent Gulf oil spill necessarily raises questions, once again, about the long-term wisdom of increasing our industrial footprint in barely accessible, environmentally sensitive, Arctic waters.
The second item, in turn, is related intimately to our ongoing efforts to dig up or suck out fossil fuels wherever they may be found, no matter the cost. Climate scientists crunched the numbers and 2012 will likely go down as the ninth warmest year on record globally, while here in the U.S. this past year has been the warmest on record. If you think things have been warmer of late, you are correct – scientists have confirmed that 9 out of 10 of the hottest years on record have occurred since 2000.
What effects has this warming had? Well, for one, it is clear that the far north and the Arctic are melting away at an increasing rate and at speeds far faster than climate model have so far predicted. The 2012 summer Arctic polar cap ice melt, for instance, is the biggest on record and seems to further confirm that the planet’s northern polar ice pack is in a death spiral that could lead to an ice-free North Pole by 2020. Meanwhile, scientists say ice in Greenland and Antarctica is also melting – which could dramatically affect sea levels worldwide by the end of the century.
Finally, glaciers worldwide are also disappearing. To understand how much of a problem that is, consider the fact that Himalayan glaciers feed major rivers in both India and China and that losing that glacial water could lead to devastating agricultural losses in two giant, nuclear-armed countries that together comprise one third of humanity.
Closer to home, climate change is widely blamed for the devastating drought throughout the U.S. Midwest this past summer, the worst in 50 years, which scorched crops and put immense pressure on U.S. agricultural production and global grain prices. The drought has also threatened the navigability of the Mississippi River, a major economic artery, and follows on droughts in Texas and the Southeast that were exacerbated by poor water management and runaway population and economic growth.
The U.S. Southwest, of course, remains a parched tinderbox, and the severity of Hurricane Sandy, which laid much of New Jersey and New York low in November, is also thought to have been worsened by changing climate conditions.
The price of solar and wind power
Altogether, it is estimated that climate change costs the world economy over $1.2 trillion a year – or a little under what the U.S. has spent so far on its wars in Iraq and Afghanistan. This reduces global economic growth by 1.6 percent a year, which could get much worse if, as scientists believe, climate effects are actually underestimated by their inherently conservative mathematical models. It has gotten so bad that even Republicans, once they are safely out of office, are admitting that climate change “is real.”
The tragedy of this seemingly intractable, ongoing catastrophe is that it is so unnecessary. This past Christmas, as Texans were opening presents, drinking eggnog and gobbling down Christmas dinner, Texas’ growing number of wind farms produced 25 percent of the massive state’s power. Germany, meanwhile, produced enough renewable energy in 2012 to account for 26 percent of that country’s electricity production – with solar accounting for 6 percent of the total. Germany, needless to say, is not a small country. Indeed, it is a premier exporter and the economic heart of Europe.
Solar power, in particular, seems to be finally taking off as a viable source of mass-produced, relatively cheap, renewable power. There has been a global build out of solar panel manufacturing capability – meaning that prices will continue to drop for consumers. Costs are dropping so fast that some analysts predict the solar power industry may no longer need government support within a decade.
Furthermore, the solar power industry is increasingly looking like the computer and electronics industries, with a “Solar Moore’s Law” beginning to manifest itself as investment dollars flow to the sector. That this is so makes a lot of sense – the same principles of applied physics and materials science that have proven so useful in making ever more powerful computer chips can obviously be applied to solar power.
All this suggests that the biggest long-term impact President Obama can have in his next four years is to continue to champion renewables while revamping America’s green energy effort to make them more effective and efficient. First, federal renewable energy spending, which has grown tremendously, needs to be further increased and retargeted. Instead of spending tax dollars on demonstration projects or to subsidize companies, like the failed Solyndra venture,
Washington should be spending even more on basic clean energy research at our public universities and research institutes. This is critical because investment in basic research has a huge spillover effect, and it is far more likely to produce the game-changing innovations required to take the solar and wind industries to the next level. Research support also falls squarely in the realm of traditional federal activity in this area, and thus avoids the political problems that come with the funding of particular companies or projects.
Fossil fuel and carbon tax
Second, the federal government needs to stop subsidizing fossil fuels. Oil companies, coal companies and now natural gas producers receive billions in tax credits and direct subsidies that far outstrip the assistance given to the renewable sector. Indeed, truly clean power, like that from wind and solar, actually receives very little assistance since nearly half of federal renewable energy spending has traditionally gone to the costly, inefficient and not terribly green ethanol production. So far fossil fuel subsidies have managed to survive even the fiscal cliff – but Obama should make their elimination a key negotiating point going forward.
Third, the Obama administration should go one step further by placing carbon taxes on fossil fuels at the mine gate or wellhead and using those funds to support consumer adoption of renewables – like Dow’s new solar power shingles – and energy efficiency efforts throughout the U.S. economy.
It could also use carbon taxes to fund clean energy infrastructure developments like solar, wind, geothermal and tidal power plants, high-capacity power lines to bring renewable power to market and the “smart grid” technology needed to manage a renewable-heavy electrical grid.
So, to recap, the fossil fuel industry remains an environmentally risky industry that receives billions in government handouts. Climate change is real and getting worse. Renewable energy is on the cusp of making revolutionary inroads into the domestic power market. The fossil fuel industry, in turn, has been making great efforts to retain its monopoly over the American energy market through fear-mongering propaganda, outright lies and a well-oiled money machine that wields immense influence on Capitol Hill.
President Obama’s victory in 2012 has demonstrated that politics is not all about money and that an organized grassroots campaign can wield immense influence if people can be motivated to turn out and tune in. As we go into 2013, let’s hope this same enthusiasm can be channeled so as to force Congress to lend a hand in creating groundbreaking change in America’s energy landscape.