21 December 2010

Engineering Tunnel Vision

‘Today’s solutions are tomorrow’s problems’, with this spot on sentence my professor in environmental history concluded his rather dry lecture. A couple of days later I read: ‘The call for geo-engineering to tackle climate change is getting louder’. Geo-engineering involves purposely changing the composition of the earth’s surface or atmosphere. Two examples: Geo-engineers propose to dump a gigantic amount of iron into the oceans. The oceans are already our biggest CO2 sink and iron, apparently, helps the oceans to store even more CO2. Inserting iron in the oceans would therefore solve our climate change problems. The second idea is to artificially simulate the effects of a volcano by emitting a large amount of dust particles into the upper layers of the atmosphere. Dust particles tend to block the sunlight and therefore have a cooling effect on the earth; voilà, global warming solved.


In the engineer’s model these so called solutions might do a great deal in solving the global warming problem. However, a model is an oversimplified version of reality and therefore unable to take into account the complexity of system earth. Will the unforeseen side-effects of these ‘solutions’ not pose an even bigger threat than climate change itself? Our planet is not a test tube, there is no Planet B!

14 December 2010

PV market size to reach 16,3 GW in 2010

The global market for PV-solar cells will reach 16,3 GW in 2010, compared to 7,2 GW in 2009, in other words, a triple digit growth rate. For 2011 a more moderate growth of 25% is forecasted. The main markets will shift from Germany, Czech Republic and France to Italy, the US, China, Canada, India and other smaller markets in the EU and Asia. Furthermore, panel prices are estimated to drop 15% over the course of 2011. Source: Solarbuzz, the information consultant for the solar industry.

11 December 2010

Rethinking Energy

In search of structural solutions
By: Timon Dubbeling

Since the emergence of the environmental movements during the 1970s and their initial results the decade after, ‘green thinking’ has started to establish itself especially in the mindset of developed, western societies. Today, however, as the climate debate is becoming more complex and as the ‘business-as-usual’ practices of international politics do not seem to be sufficiently restrained by the ‘green’ approach, it is about time to change the current way of thinking. Ironically, the way ahead will be to bypass the ecological movements.

First the good news: the rise of ‘green’ movements has in the course of the last decades altered the awareness of people vis-à-vis the environment; many individuals have already adapted their way of life. Green initiatives are emerging, ranging from the usage of FSC-paper to the preservation of natural heritages that would otherwise have vanished. Not only have green parties established themselves in the highest spheres of decision-making, those actors lacking a history of ‘greenness’ are now also directly or indirectly forced to increasingly engage in this new way of thinking. The most profound achievement of the last decades is perhaps the international acknowledgement of the emergency of climate change.

Unfortunately, society has reached a state where the green mentality alone does not suffice to combat the dangers that are facing it in the coming decades. Call it pragmatism, call it pessimism, but the demand for energy, along with the corollary consumption of fossil fuels, will continue to rise. The emission of CO2 is anything but descending and in the aftermath of the disappointing Copenhagen summit, prospects for improvement are low.

So where does one go from here? Most importantly, one needs to define the problem. Over the course of the last decades, and in an intensified manner during the last years, the already complex problem of climate change has been made even more complex. However, issues such as the melting of the polar caps or coal-fired power plants built in China are only marginally related to the core issue we have to solve. The real matter one stands to embark upon can be summarized in merely two words – energy consumption. By focusing on reducing the energy intensity of one’s life in a profound, structural and widely applicable manner, one can define a comprehensible, effective, and most importantly, a logical solution.

It is crucial that one understands why the current ecological approach does not pertain to the problem one should be aiming to solve. There are multiple deficiencies in the impact of ecological thinking, but let’s focus on its fundamental flaw: the moral appeal of green thinking purports the message that in order to make a difference, one should strive for limitative and restrictive actions. For example, one is told not to take the car, to turn of the lights when leaving, to put on a sweater rather than turning on the heater, etcetera. These are all viable, praiseworthy appeals and crucial measures to be taken in the aim of reducing energy consumption. However, it subliminally still feels restrictive.

Although many individuals have responded to this moral appeal over the last decades, recent polls indicate that in many western European countries, the willingness to reduce one’s energy intensity is declining – let alone how the average Chinese citizen thinks about limiting his recent enjoyment of middle-class life.

So what is the solution? It all comes down to the very conception of energy that we have. If we conceptualize energy itself in a different manner, we inherently reconsider its consumption. The gas in our heating, the electricity needed for the light bulbs and television to work: the energy we consume on a daily basis is still an invisible but nonetheless necessary mean for us to live our lives. Energy needs to become visible. Our attitude towards energy needs to adapt itself to the givens of today.

Our generation has learned to behave and communicate in an environment that is interactive and supranational in nature. Information has become a means of exchange on an unprecedented scale and with an unbelievable speed and effectiveness. We buy books on Amazon, sell our bike on EBay and share photos in an interactive, decentralized environment. Energy should be such a means of exchange. If energy is no longer something we simply buy from our energy companies but rather like the photos we upload and distribute, we can redefine energy in the most profound manner.

To understand how this vital transition would work, it is important to investigate the energy infrastructure itself. Since the introduction of large-scale electricity networks in the early 1900s, the consumers have grown accustomed to the idea that they buy the energy they need from the energy company. In this ‘centralized’ conception there is no link between two individual consumers i.e. the usage of energy of one person has no effect on that of the other. However, if one transform this system in such a way that it becomes possible to sell back energy to the grid or to sell locally produced energy to the company or to others, the very comprehension of energy will change.

Such a decentralization of the energy system has significant consequences and an enormous potential. Firstly, it would resemble the interactivity we are already accustomed to in our daily lives. If, in this interactive grid, one decides to build solar panels on top of one’s roof, it is possible to sell the energy that is produced to the grid, or more directly, to one of the surrounding consumers. This makes it interesting to generate energy locally. But it gets more interesting once the mechanism of energy becomes responsive. For in this type of network, the grid would allow a swift transport of energy from a place where there is a lot of supply to a place where there is a high demand.

Even more, what happens if the price fluctuates based on these very simple economic interactions? That would imply that energy is more valuable at times of high demand, say, for instance, around dinnertime. If one decides to sell one’s energy to the grid during this time of strong demand, a higher price will be paid for it. Similarly, if one decides to buy the same amount of energy of the grid to do the laundry late at night, the costs of doing so will decrease as the overall demand for energy is at a lower level.

The very root of the idea is that in a decentralized energy system, energy becomes a means of making money – an asset – rather than a necessary expenditure. And this definition of energy fits into the economic logic that has, in the course of time, engraved itself in our way of thinking. This ‘natural’ logic alters our behavior in a much more profound way than the moral appeals of the current ecological discourse would ever be able to. Obviously, even in the current settings the reduction of energy usage is recommendable for reasons of saving money. But rather than it being a limitative measure, the reduction of our energy usage now becomes similar to a reflex. Why leave the lights on, if by turning them off, one makes money by selling the energy to someone else?

On a larger scale, this new concept of energy achieves results that the ecological movements are so ardently striving for. First of all, in a decentralized energy network, local energy generation is stimulated –whether it is on a household basis, with the entire street or even the entire village. As such initiatives arise on a large scale, a bottom-up movement towards a new, ‘green’ era is born. Since local energy generation through e.g. wind, solar or geothermal power increases, the overall share of renewable energy within our energy mix increases. This indirectly combats climate change as one reduces the carbon intensity of one’s energy usage.

This transition also implies a strong democratization. Not only are people much more likely to reduce their energy usage but they do this in ways that give them a sense of strong individual liberty. The energy arena loses its hierarchical structure in similar ways as the expansion of Internet has. Like Internet, this new definition of energy is not restricted by physical borders. This means that, in contrast to the moral pleads of the ecological movement, this logic appeals as much to a farmer in Ivory Coast as it does to a New York businessman.

Ecological movements have achieved important results in the course of the last decades. Their actions are and will remain of high importance in underlining the need to act against the challenges we are faced with. Nonetheless, the limit of their effectiveness seems to have been reached. Their successes will undoubtedly continue but the moral and limitative appeals will not suffice to formulate structural solutions to the core issue – the reduction of energy consumption. Even here in The Netherlands, the willingness to comply seems to have reached its zenith some time ago. By altering the definition of energy in such a way that one manages to insert it into a logic that is more inherent – or at least feels that way- one can profoundly alter the status quo by empowering the individual. If energy becomes like last night’s photograph that spread rapidly in an interactive and non-hierarchical structure, and an economic means of exchange rather than an invisible necessity, we can at last formulate a coherent response to the vast problem that society faces.


This article was first published in Scope Magazine, the semi-scientific journal of University College Utrecht (UCU), on the 10th of December 2010. 
The author Timon Dubbeling is studying political sciences, international relations and history at UCU and is currently on exchange at Sciences Po in Paris. Furthermore, Timon is in between presidentships of the Independent Student Energy Platform (ISEP), a student organization pursuing an informed discussion on energy topics.   
 
This article is the first of a series of guest posts with the objective of broadening the scope of this blog by providing inspiring stories by students  and young-professionals engaged in the energy transition across the globe.

7 December 2010

Global warming today?

'On monday the Netherlands saw the longest traffic jam ever caused by snow, the ANWB (Dutch driver's assocation) and heating system technicians are making overtime. In the UK temperature records are broken and in Brussels a demonstration against global warming was cancelled because of the cold. Global warming is not really taking off', according to Richard de Mos of the right-wing political party (PVV) during a debate in the Dutch parliament. In reaction Diederik Samsom of the labour party (PvdA) asked him if he was giving a cabaret show, because according to NASA statistics this year was the hottest year recorded up to now.

(translated from AD PVV: Opwarming aarde wil niet vlotten)

The Candy Bag Analogy

My favourite Dutch liquorice
Do you ever buy yourself a bag of candy, open it and start eating? At first, the candy tastes great, your mouth starts watering and you keep on eating. Almost unconsciously you take another one and another one. Before you know it, the bag is almost empty. As soon as you realize that there is only a handful of the delicious candy left, you slow down. The last pieces of candy are treated as a specialty. You don’t just bite twice and swallow like with the first pieces, but you let them go round and round in your mouth and you suck until all the flavour is gone. The last few pieces in the bag actually last much longer than the whole first part. However, eventually you empty the bag of candy anyway.

Still you’re craving for more candy, so you go back to the candy store. The shopkeeper sees you looking around for another bag of candy. He comes up to you with a new kind of candy. He explains it is a special bag. All the ingredients are natural and, although the bag is twice as expensive as the bag you bought before, it will replenish itself automatically, over and over again. It sounds almost too good to be true, almost...

24 November 2010

(Hidden) fossil-fuel subsidies

Power plant burning tax money
‘Wind turbines run on subsidies’, according to the freshly installed Dutch Prime-Minister Mark Rutte in one of his speeches during the recent election campaign. This view is strongly supported by the Dutch weekly Elsevier. In a recent article the author Syp Wynia comes to the conclusion that subsidizing uneconomic energy production hampers investment into sensible means of energy production. I completely agree with Mr. Wynia that counter-productive subsidies on energy should be cut. Therefore, I kindly asked Mr. Wynia to also write a juicy story on subsidies for fossil-fuels. Until now I haven’t seen any attempt in this direction, so I’ve taken the liberty to do so, based on renown sources as The Economist and OECD.

Fossil-fuel subsidies worldwide
Having one hand tackling climate change and the other supporting the main contributor to the problem: fossil-fuels, is not a sensible approach. This is slowly but surely being recognized by the international community. In late 2009 the leaders of both the Group of Twenty (G-20) countries and the Asia-Pacific Economic Cooperation (APEC) forum committed to phasing out inefficient fossil-fuel subsidies. In order to grasp the size of the problem the G-20 asked the IEA (International Energy Agency), OPEC (Organisation of the Oil Exporting Countries), OECD (Organisation for Economic Co-operation and Development) and Worldbank to jointly carry out a study on this topic. They found out that government support of the production or consumption of energy is widespread an can take many forms, for example: keeping prices artificially low; providing grants or low-interest loans, or guaranteeing loans provided by commercial banks; granting tax exemptions or reductions; providing certain companies with preferential access to mineral resources or land (e.g., for pipelines or transmission lines) at below-market prices; and supporting research and development (OECD et al., 2010) See the OECD study for concrete examples of consumer (p. 19) and producer (p. 20) subsidies on fossil-fuels

Quantifying the exact amount of government support to fossil-fuels has proven difficult, because of the various forms these subsidies take. The more visible subsidies are directed at consumers of fossil-fuels. The IEA has estimated these subsidies to be around US$ 557 billion in 2008. This amount comprises subsidies to fossil-fuels used in final consumption and subsidies to fossil-fuel inputs to electric power generation. The IMF estimates that costs relating only to subsidizing gasoline, diesel and kerosene already exceeded US$ 500 billion in 2008 (OECD et al., 2010).
In most developed countries the support for fossil-fuels is more subtle and directed at the production of fossil-fuels. These subsidies may be on the order of US$ 100 billion per year according to research from the Global Subsidy Initiative (GSI, 2010). Together the total worldwide fossil-fuel subsidies amount to around US$ 700 billion annually, which is about 1% of global GDP (OECD et al, 2010). 

If the subsidies on fossil-fuels were phased out by 2020 it would result in a reduction in primary energy demand at the global level of 5.8% and a fall in energy-related carbon-dioxide emissions of 6.9%, compared with a baseline in which subsidy rates remain unchanged. This reduction potential is equivalent to the current emissions of France, Germany, Italy, Spain and the United Kingdom combined (OECD et al., 2010).

Government support for coal mining in Germany
I like to refer to Germany as the country taking the lead in the global energy transition, because of its progressive policies regarding renewable energy. However, German energy policy also has a dark side. The large German electricity companies are obliged to use at least a certain volume of coal from German mines at a price that is above the (world) market price (van Beers et al., 2002). This regulation is estimated to have amounted to €80-100 billion support for the coal industry for the period 1975-2002 and another €16 billion for 2005-2012 (Jacobsson, 2006). The European Union wants Germany to cut these subsidies by 2014. The German government, however, is unwilling to cut its coal subsidies until 2018.

Tax exemptions for large energy users in the Netherlands
In 2002 van Beers c.s. published a report on environmentally distorting subsidies in the Netherlands. One of the regulations they looked at in detail is the Regulatory Energy Tax. Large energy users are (partly) exempted from these energy taxes. This exemption stimulates above all the energy-intensive sectors and greenhouses. These sectors together account for almost half the total final energy consumption in the Netherlands. Van Beers et al. (2002) come to the conclusion that the exemption from Regulatory Energy Tax for large-scale users means a subsidy of between €1.6 and 5.2 billion yearly.

Dutch government buys CO2-emissions certificates for coal fired power plant operators
Two weeks ago the Dutch news show EenVandaag broadcasted a story on government support for the coal fired power plants that are being built in the Netherlands at the moment. The Dutch government agreed to pay for 80% of the CO2-emissions certificates that large energy users have to buy under the European Emission Trading Scheme (ETS) for the next 10 years. This amounts to a support of the new coal fired power plants of €200 millions yearly. Without these perverse subsidies the new coal fired power plants arguably would never have been built.

Liberal principles?
Recently the Dutch Green party has started an initiative to map government subsidies on fossil-fuels. They come to an estimate of €7,5 billion yearly. Liberalism tends to be wary of such perverse market signals, therefore I have high expectations of the VVD, the liberal party currently in power in the Netherlands to do something about these abuses.

Dear Mr. Rutte, if coal fired power plants wouldn’t be burning tax payer’s money, wind turbines could run without state support!

19 November 2010

Transition versus Vested Interests

House providing itself with solar power
A transition is a ‘structural societal change resulting from mutually reinforcing developments in economy, culture, technology, institutions and nature’, according to the Dutch transition guru, Rotmans.

A transition towards a sustainable energy system is necessary and inevitable for reasons of cost, (energy) security and climate protection. Even the Dutch government seems to have grasped this necessity and has created a platform EnergieTransitie to guide the energy transition. 

Inflation
However, lately the meaning of a transition has been subject to inflation. A couple of weeks ago, the Platform EnergieTransitie proudly presented the first successes in Carbon Capture & Storage (CCS). This technology is seen by the Platform as the ‘deus ex machina’ towards reaching CO2-reduction targets. CCS, however, has nothing to do with an energy transition because it, instead of spurring societal change, would provide a means of continuing business as usual without critically assessing the energy system.

Recently, the renowned Boston Consulting Group (BCG) published the report ‘Groen licht voor groene stroom’ (Thumbs Up for Green Electricity). This report rightly concludes that the policy of the Dutch government falls short considering long term investor security in the renewable energy sector.
In order to make the energy system sustainable, BCG sees the biggest opportunities for the Netherlands in large scale (offshore) wind and biomass projects because these would be most cost efficient. However, in a real energy transition, decentralization is key.

Decentralization
Decentralized production of renewable energy is by definition more efficient than a centrally organized fossil based energy supply. This is due to the fact that it avoids losses through energy conversion and distribution. Renewable energy potential is distributed randomly across the globe and, similarly, energy use mostly takes place in a decentralized manner. Why bother centralizing production only to distribute it again afterwards?    
Furthermore, decentralized local energy production leads to a democratization of the energy system. Individual households will no longer be dependent upon large centralized energy suppliers, and could thus choose how to provide in their energy needs. Energy dependencies, whether on monopolistic multinationals or instable corrupt countries, would be  confined to history books.

In its report, BCG does mention the possibility of solar energy as a means for a decentralized energy supply that could already be competitive with consumer electricity prices by 2015. Surprisingly however, they conclude from this fact that solar could not contribute significantly to the Dutch energy mix.    

Winners and losers
If the Netherlands really wishes to make its energy system more sustainable, it is necessary to make clear choices. A transition inherently includes conflicts of interests. In the long term outlook of the report mentioned earlier, BCG states: ‘It is essential that the Dutch government actively involves the energy industry in the decision making process towards a common transition towards renewable energies. If there is no intrinsic ambition from the industry towards sustainability, all state initiated action will in the long run fail.’ (translated from Dutch)

Experience, however, shows that organizations that have vested interests in maintaining the status quo will not actively promote change and could even hinder a transition. Therefore, far more potential lies in decentralized, bottom-up initiatives. An example of which is the Windvogel (Wind bird) initiative: a local cooperation of citizens that purchase a wind turbine together and use the produced energy themselves. Also, in Germany, the country taking the lead in the global energy transition, bottom-up initiatives like the ‘Solar Bundesliga’ (a competition between municipalities to produce as much solar energy as possible) and ‘100% renewable energy regions’ (an initiative to make regions selfsufficient regarding energy use) have proven to be very successful.

Government should lead the way
The Dutch government has the difficult task of guiding the upcoming energy transition while ensuring that it comes about as smoothly as possible. The government made a first step in the right direction with the founding of the Platform EnergieTransitie. Followed by a step in the wrong direction, with appointing the general-director of Royal Dutch Shell as the chairman of the platform. Recently followed by a leap in the wrong direction through announcing plans for a new nuclear power plant.
The Dutch government should make sure not to act according to the stakes of the established companies, but in the interests of society as a whole.

(based on my column in Dutch on EnergySquare on 22/06/2010)

16 November 2010

German Breakfast

(a couple of weeks ago)

Nuclear power plant in the US
This morning I got out of bed late, too late. I decide to skip the first lecture, to enable me to still have some breakfast. Unlike other mornings, I turn on the TV. To my surprise, I tune into a live debate in the Bundestag (German parliament), which is at that very moment discussing the ‘Energiekonzept’: a comprehensive vision for the German energy system until 2050. This plan, devised under a centre-right wing German government, would be mouth-watering to many Dutch proponents of an energy transition. However, in Germany, the plan has spurred tremendous debate because it proposes a turnaround in policy regarding its nuclear power plants. In 2002, the red-green government decided that Germany would stop its nuclear power production; over a time span of 20 years, all nuclear power plants should be closed down. With the Energiekonzept however, the current government agreed that the nuclear power plants will stay online for an average of 12 years longer. The four energy companies that run the nuclear power plants will make estimated profits of between 60 and 120 billion euro by this decision. The government argues that nuclear power is going to pay for the energy transition by imposing a tax on enriched uranium that is used to produce power. These tax revenues of approx. E2,3 billion yearly will mainly be invested in research for renewable energies.  During the emotionally heated debate, the Green party accused the government of nuclear lobby politics. They argue that a continuation of nuclear power will prove an effective blocking strategy for a growing amount of renewable energy. Nuclear power output is not flexible; therefore, it is not compatible with (the highly variable output that is characteristic of) renewable energies.         
This fierce debate overshadows the other goals agreed upon within the Energiekonzept, which as stated before, I could only dream for a right-wing government in the Netherlands to implement. The goals are binding and include: 80% of electricity from renewables in 2050, 50% of primary energy supply is renewable in that year, CO2-emissions are cut back with 80-95% and energy efficiency improves with 2% each year. In order to meet these goals, a comprehensive set of measures is agreed upon, including funding for renovation of buildings and support for the first offshore wind parks amounting to E5 billion.
While our government discusses building new nuclear power plants, Germany demonstrates that despite agreeing upon a longer life for its nuclear power plants, it is way ahead of us.
All in all, this breakfast was well worth skipping class, not neglecting the fact that I am very lucky to be studying in the country that is the global forerunner in the energy transition. I’ll come back when the Netherlands is ready for it.