In a previous post, I used the the concept of "Sower's strategy" to propose that the way to solve our predicament of depletion and climate disruption is to use fossil fuels as a way to get rid of fossil fuels. In other words, we need to use fossil energy - as long as we have it - to develop substitutes to fossil energy. This is equivalent of the old strategy of farmers of "saving your seed corn". But how much corn should we save, exactly? In the present post, Sgouris Sgouridis provides an answer. It turns out that in order to have a smooth and gradual transition to renewable energy before fossil energy becomes too expensive, we need to ramp up investments in renewables by a factor 4-10 that should be reached by means of an annual increase of the current investment between 6% and 9%. Eventually, the investment rate should reach amounts of the order of 1.5-2.5 trillion dollars by 2045. It is a tantalizing result, because a 9% yearly increase is possible: we have been growing renewable power at faster rates up to now. And even a total amount of a couple of trillion dollars is not impossible considering that the present world's GdP is about 72 trillion dollars (compare also with the 1.7 trillion dollars per year spent for the world's military system). Unfortunately, it is is perfectly possible that the action of the fossil lobby will be able to slow down the growth of renewables or even to stop it completely. In this case, we will not be able to avoid a significant (and probably disastrous) dip in the amount of energy available worldwide as the unavoidable decline of fossil energy plays out. Nevertheless, any investment in renewable energy we can make now and in the near future will help make the transition less hard on all of us.
Guiding
the Energy Transition (Part 1): Principles and Implications
By Sgouris Sgouridis (*)
Abstract:
Following on the sower’s metaphor,
I present a quantified view of exactly how much energy we need to invest from
our current bounty in order to be able to safely navigate a sustainable energy
transition. This is in the context of a formal definition of five principles
for the energy transition. We currently invest around 0.25% of our net
available energy surplus into renewable energy generation capacity (this is the
renewable energy investment ratio – "epsilon"). It needs to be increased to about 3% (an
order of magnitude) for our energy systems to be able to provide for a
2000W per capita society at a global scale without crossing the IPCC carbon
budget. (note that modern western life is consuming around 8000W per capita). If we do allow for unrestrained emissions then we still
need to increase this rate to 1.5%.
Energy is a sine qua non for any self-organizing system and yet it features only in
the margins of what passes for long-term planning of our societies.
We have grown critically dependent on cheap, energy-dense fossil carbon but
its price and climate externalities have been rising as we are nearing peak
production. This necessitates a transition to renewable energy sources. This
post addresses the implicit physical and financial requirements if this
Sustainable Energy Transition (SET) is to happen as a result of a planned and
seamless transformation; not forced upon our societies. More specifically, in
Part 1 I present five principles (the three first are limiting and the latter two
normative) that can be used as a guide for the transition. Based on the fourth
principle, I demonstrate the need to increase the amount of investment in
renewable energy resources globally by one order of magnitude to achieve a Sustainable Energy Transition
within the IPCC carbon budget. Details of the assumptions and methodology can
be found in Sgouridis & Csala 2014. In Part 2, starting from the fifth principle, I present
a concept of an energy currency that could mobilize resources to achieve this
target while better aligning the monetary system with the biosphere limits.
It is generally good to start with a
definition to create the common basis for understanding and judging an idea. In
this case, I will define SET (sustainable energy transition) as:
a controlled process that leads
an advanced, technical society to replace all major fossil fuel primary energy
inputs with sustainably renewable resources while maintaining a sufficient
final energy service level per capita.
As definitions are wont to be, it
tries to capture a lot of concepts sinthetically. But the key words are
“controlled”, “technical”, “all” and “sufficient”. The ideas conveyed indicate
that the transition should be smooth and not associated with dramatic social
dislocation (controlled). It should allow for society to at least maintain its
technological capabilities (technical), and at the level of the individual meet
a certain threshold of final energy availability (sufficient).
Knowing that the transition will be
complete when practically all fossil fuels are replaced, we can backcast the
evolution of the transition to the current energy situation. In this exercise,
it is instructive to use an energy metabolism perspective focusing on the net
energy availability. This way, an unambiguous and transparent picture emerges
that pulls back the veil that economics placed in long range planning.
In order for this transition to be
indeed “sustainable" we would need to concern ourselves with each of the
three sustainability pillars (environmental, social, economic). Extending Daly’s ideas, we propose five principles
that need to be met - de minimis - for a SET to be successful:
I. The rate of pollution
emissions is less than the ecosystem assimilative capacity.
II. Renewable energy generation
does not exceed the long-run ecosystem carrying capacity nor irreparably
compromises it.
III. Per capita available energy
remains above the minimum level required to satisfy societal needs at any point
during SET and without disruptive discontinuity in its rate of change.
IV. The investment rate for the
installation of renewable generation and consumption capital stock is
sufficient to create a sustainable long-term renewable energy supply before the non-renewable safely recoverable resource is exhausted.
V. Future consumption commitment
(i.e. debt issuance) is coupled to and limited by future energy availability.
The first two principles address the
environmental aspect (neither fossil nor renewables should impact the
environment irreparably within a human generation). The third addresses the
social aspect ensuring that (i) a minimum level of available energy is
available, and (ii) the rate of change in energy availability is not so drastic
that it creates breakdown of social support systems. A direct corollary of this
is that a more equal society faces an easier SET task than an unequal one.
Finally, the last two principles address economic sustainability (physical and
financial). P-IV, a variant of the Hartwick rule in economic literature,
ensures that the rate of investment in renewable energy is sufficient to
compensate for the drawdown of the fossil fuel supply while, P-V makes the
connection between debt issuance and the availability of energy to service that
debt in the future (which is the subject of Part 2).
Viewed from a normative angle, the
first three principles act as constraints of the transition function - the
first gives an upper limit in the amount of fossil energy available, the second
puts a limit in the amount of renewables that can be installed, the third
provides a lower bound on the per capita energy availability (and of its first
derivative during the transition). The latter two though are prescriptive and
actionable - they offer a quantifiable approach to estimate the minimum energy
investment in renewable energy and the maximum debt that can be extended for
that level of investment.
Focusing on the physical side, we can
essentially create an equation that ties the renewable energy investment ratio
(epsilon) to net societal energy availability which can be seen below
(derivation in the paper and supplement):
This recursive equation can be solved
numerically or analytically to establish the net power available under
different assumptions for the value of epsilon. Below I provide, as a starting
point of the discussion, a comparison of the evolution of future energy
availability under the following scenarios. As typical of energy transitions
(and to meet the discontinuity constraints of Principle III), we assume in the paper that it
takes thirty years to change epsilon from its current value of around 0.25% (we
actually assume 0.375% for this model) to the “target” value and simply compare energy availability with energy demand assuming that (a)
population follows the UN mid-projections stabilizing at 9 billion by
2050, (b) per capita power demand converges to 2000W , and (c) the
efficiency at which we convert primary to
final energy improves by 25%. (the details on the assumptions regarding population are described in Sgouridis and Csala's paper).
Frying
the Planet
Available
Energy with No Carbon Cap Top: ε = 0.375 %, Bottom ε = 1.5 %.
Left:
Breakdown by source. Right: Red line indicates Net Available Energy. Blue Line
indicates where we need to be at a minimum
50%
chance of Slow Cooking the Planet
Available
Energy with IPCC Carbon Cap Top: ε = 0.375 %, Bottom ε = 3.0 %.
Left:
Breakdown by source. Right: Red line indicates Net Available Energy. Blue Line
indicates where we need to be at a minimum
The results are starkly clear: if we
allow fossil fuels to run their course frying the planet in the process, we
will need to increase our rate of investment in renewables fourfold. If we
decide to save the climate and adhere to the IPCC recommendations of no more
than 3010 anthropogenic Gt CO2 in the atmosphere by 2100 for having a 50%
chance of remaining below 2C by the end of the century (which, apropos, is
still the moral equivalent of loading a revolver with three bullets and playing
Russian roulette with our grandchildren) we need an eight-fold increase of the
investment rate in renewables. Of course, there are key sensitive assumptions involved like the
EROEI of renewables (in the scenarios shown starts at 20 and increases with
installations) - readers are welcome to enter their own assumptions in our model - yet we believe that our choices are
neither conservative nor aggressive and we intend to enhance the simulation’s
resolution by disaggregating specific renewable energy technologies as we did
for fossil fuels.
(*) Sgouris Sgouridis is Associate Professor at the Masdar Institute of Science and Technology (UAE). His research interests focus on understanding sustainable energy transitions using socio-technical systems modeling. He has been working on the energy currency concept, electric vehicle adoption, sustainable aviation, and local and global sustainable energy transitions. He initiated the development of the Sustainable Bioenergy Research Consortium at MI and was a member of the Zayed Future Energy Prize review committee for the past four years. He holds a PhD in Engineering Systems (MIT-2007), MSc in Technology and Policy and MSc in Transportation (MIT-2005) and a BS (Hons.) in Civil & Env. Engineering (1999-Aristotle University).
