Debating 4 Dirty Myths on Clean Energy

Michael Molnar, Contributor
January 07, 2013 | 18 Comments

As the US Presidential Election is now behind us and 2013 is beginning, it is critical that our country begin to focus on solving problems. As one of this generation's most pressing problems is related to energy and sustainability, my sincere hope is that the debate on this topic leads us forward in a way that benefits our economy, environment, and security. Good debate, based on facts and reality, will lead us to a better place. Poor debate, based on fiction and myths, will lead us nowhere. And going nowhere on one of the most important challenges of this generation is unacceptable.

Debate 3: Where Should Innovation be Focused?

Myth:  We need new technology, period
Reality:  We need innovation in technology, policy, business models, and financing

There have been countless calls for new technology in energy and sustainability. From Venture Capitalists to the US Government, billions of dollars have gone into various so-called “disruptive” technologies. But the best technology does not always win in any industry, and especially so in energy. I argue that a fixation on innovation in technology without corresponding innovation in policy, business models and financing is a losing recipe. Government and investors should be aware, as it is clear that the lessons will be very expensive for those that have gotten it wrong.

Policy creates incentives, which drive behavior in energy. “Decoupling” is a good example of innovative policy aligning incentives for the common good. Any business typically wants its customers to use more of its product. More use means more profits. Unfortunately, in the utility business that means that there is an incentive to have customers use energy inefficiently and thus they will need to buy more energy.   Decoupling can be complicated in its implementation but in effect separates usage from profits. So utilities can be incented to have efficient users of energy as their profits will remain stable, or even increase if so.

Business model innovation is also needed. The concept of “negawatts” is a good example of one such innovation. Instead of building capacity, or megawatts, to align supply and demand, some businesses have formed around curtailing demand to accomplish the same goal. The businesses that formed around this concept, such as EnerNoc, were really innovating the model of doing business versus having a business based on technology.

Finally, innovations in financing of energy projects are needed. Whether it is innovative ways of matching the right tenor, risk profile, return requirements to specific projects, or more creative forms of securitization of cash flows from projects, the impact of innovative financing could be immense. Innovations in this area have the potential to be just as critical – perhaps even the most critical – to the ultimate uptake of alternative energy.

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18 Comments

Patrick Davey
January 10, 2013

Hi Cobus,
It seems we are in agreement. The more inputs and the more varied the sources the better. But the major problem technical problem with this approach is the rapid increase in complexity of control as the sources export or import power, as they will if they are domestic solar pannels. The entire network must be kept in phase as well as at the specified voltage. My understanding is that if the distribution network is DC the phase problem disappears and voltage control is less critical because inverter technology is more accomodating to input voltages.
Here in Europe half the continent went down for a time because a very large windfarm was fluctuating in output.
In general a combination of wind, solar, hydro and nuclear, particularly if we can move to thorium or fusion seems to optimum.
But change we must or we all go down, well grandchildren if not us.

Cobus van der Merwe
January 10, 2013

Hi Patrick,

I was not blaming anyboby but merely stating an observation that a centralised concept that relies on nodal weaknesses like single point of genration for an entire network or transporting that energy over a limited number of HV lines has the inherent weakness of being taken out by events natural or otherwise. Such an event is to the detriment of an entire region. One needs to resolve both the redundancy on the generation side (I like your "multiplicity" idea) as well as overcome reliance on a limited number of supply lines. The best concept both from a survivability as well as self-sufficiency point is still localised generation.
Regards,
Cobus

Patrick Davey
January 10, 2013

Cobus Holistic is not entirely correct in blaming outages on Government controlled/owned centralised distribution systems. A regionwidw system allows power to be moved from where it is available to where it is needed but with a multiplicity of inputs which come and go with the weather the control is very difficult and can lead to totally unexpected surges and overloads. I am not an electrical engineer but I understand there is an argument for converting our grids from AC to DC which would mean a significant improvement in transmission efficiency but at the cost of replacing transformers with inverters.

ANONYMOUS
January 9, 2013

In response to the last comment I don't know what the limits are on solar and wind power in terms of supplying our energy needs but I know this: We must not only become a zero net emission world within forty years, we must figure out a way to restore the carbon cycle we have devastated by deforestation and polluting the oceans. It is not impossible, and considering the consequences of runaway climate change, it is not only economical but imperative. The scientists have only recently discovered how grossly they underestimated how fast ice sheet melting is taking place. Academic studies show how the media has deliberately undermined science and spread falsehoods to prevent people from learning the truth. Sandy and the unprecedented record shattering average temperature for the year 2012, should be alarming you to as what's in store for this world. It is terrifying!

Dr. A. Cannara
January 9, 2013

And please stop quoting "nameplate MW". A CEO of a major solar 'farm' constructor admitted at Stanford Monday that this should not be done -- that honesty is the right policy in describing how much renewables actually can contribute, 24/7 for N years running.

The wind folks fib about the miserable sporadicity and about ~12-year generator lifetimes, while solar-thermal folks fib about gas burning and transmission loss. And all the 'farm' folks fib about species impacts, land alterations and levelling/conversion/transmission costs & losses.

As much fibbery comes from some 'renewable' quarters as from the Koch brothers.

ANONYMOUS
January 9, 2013

I was wondering if the person who posted comment 8 would share the source of his theory about heat from human sources causing global warming. The Sun produces well in excess of one million times more heating on Earth in one day than all human heat sources produce in one year.

CO2 has been appreciably increased by human activity, and I think the article we are commenting on was as cogent and factual as one could hope for. My only disagreement is in saying there is a possibility that human caused green house gases are not causing global warming. There is a logical possibility of it being true, but most people don't understand that concept. Let me say that the probability is greater that a giant asteroid will strike the Earth tomorrow and wipe out all human life than that global warming is not human caused. It's time to start treating climate change skeptics as what they are...crackpots. Frankly I see lies about climate change as crimes against humanity, and eventually, most people will want some payback for those crimes. When storms like Sandy are taking place everyday, something that could happen in as little as forty years, the public's appetite for justice will be unquenchable. That's how fast things are unraveling on Earth.

Dr. A. Cannara
January 9, 2013

Unfortunately, climate change & sea rise are two long-term issues that get press, but the most imminent and serious problem is ocean acidification. This is moving quickly enough that not millions, but hundreds of millions of people around the world will lose their food sources as we pass 2050.

The pH of seas on average is lower than in 300 million years, and in the N. Atlantic it's already leading to deformities of organisms which form the bases of the ocean food chains. ~20% of all human food protein comes from the sea. ~80% of people are near coasts and dependent on seas for food.

Then, there's the 'minor' mmatter that the Carbon Cycle on Earth is completed by sea organisms and their calcification of shells & skeletons. We are about half way to shutting that process down.

To understand how we've trashed the Carbon Cycle by swamping it with ~30x the Carbon it can handle, follow the links to the DePaolo group's & others' papers...

http://energyseminar.stanford.edu/node/461

The sad part of our communal ignorance & bias is that emissions problems were intended to be solved by 2000, as Pres. Kennedy determined to do: http://tinyurl.com/6xgpkfa

Antonio Found
January 9, 2013

I think this debate is justly another appropriate wild circulating pillared door that will eventually lose momentum allowing for the natural influx of sustainable function to take place. We all enjoyed jump ropeing at some point but we get old thus it gets old.

ANONYMOUS
January 9, 2013

I am developing a smart wave energy technology and successful in other areas as an inventor. This is a very very good article the best I have seen, very important point as we humans argue about global warming we can all agree the clean energy is a good idea. But we like to argue with our beer or coffee in hand and as above, yes lots of facts and your conclusion seems reasonable but no one really knows the effect of the ocean in the end result and many smart people believe that the moderating effect of the thermocline that could change the result. The science as many call it must consider that it is all theory and that no facts or proof can be obtained until we or our kids, kids, kids actually see the result. I believe as smart as us humans have become we have a lot to learn and so for now, work for good technology and the good results will come.

ANONYMOUS
January 9, 2013

In comment #8 an anonymous poster writes: "It is important that we recognize that burning of fossil fuels produces heat (the main reason we burn them) and by-product CO2. It is the heat, not the CO2, that causes the temperature to rise."
and also writes:
"Actual measured rise was~1/4th that due to cooling by glacial melting and photosynthesis. All of the temperature rise can be attributed to heat, leaving essentially nothing to credit to CO2."

This is simply wrong; the earth is not a system consisting only of the atmosphere, a small amount of ice, and some plants. In particular, it includes a HUGE heat sink in the form of the oceans: 1.4 * 10 ^21 Kg (not to mention the land portion of the planet). The amount of direct heat generated by the burning of fossil fuels isn't enough to remotely cause a measurable rise in ocean temperatures because they are so large. Altering the amount of energy absorbed from solar insolation IS a significant effect; CO2 is the concern, not direct heat emissions. It is just amusing that someone thinks all of the climate scientists would have somehow missed the "explanation" the commenter mentions.
Steven

ANONYMOUS
January 9, 2013

It is important that we recognize that burning of fossil fuels produces heat (the main reason we burn them) and by-product CO2. It is the heat, not the CO2, that causes the temperature to rise. For the sake of argument we acknowledge that CO2 absorbs infra red radiation and may be a contributor. Can we determine how much CO2 contributes and how much heat contributes. In 2008 energy use was 16 terrawatts for a heat output of 50x10E16 btus a year. The mass of the atmosphere is 1166x10E16 pounds and has a specific heat of 0.24 btu/#-*F. That amount of heat emitted into the atmosphere can cause a rise of~0.17*F. Actual measured rise was~1/4th that due to cooling by glacial melting and photosynthesis. All of the temperature rise can be attributed to heat, leaving essentially nothing to credit to CO2. Looking at it another way; the greenhouse gases provide a protective blanket restricting heat loss but cannot tell the difference between radiation from solar or waste heat. Fossil fuels must be eliminated so what is the difference whether it's CO2 or heat? Many are proposing that nuclear power is the answer since it produces no CO2. But it does produce twice as much total heat as its electrical output. Efforts to capture and sequester CO2 are wasteful as well as harmful. For every pound of CO2 converted by photosynthesis, 5000 btus of energy are removed from sunlight that would otherwise become heat. All things else being equal the higher the CO2 the greater conversion by photosynthesis. Lastly, there are no correlations for CO2 and temperature, not past nor present, for which it can be shown that CO2 was a cause. In the past increased solar exposure caused the temperature to rise and that,in turn, caused the CO2 to rise. In the present, combustion of fossil fuels cause both temperature and CO2 to rise.

Gunther Beck
January 9, 2013

Good article, but allow some comments:
1) we need new technology: wrong. Start using what exists. It has to be improved but the learning curve provides a lot of cost reduction potential (see PV: the learning curve was the idea behind Germany's subsidies - and now we are there, perfectly in line with the theory!)
2) Alternative energies already make a difference: look at countries like Norway, Switzerland, Denmark. Look at the development of windpower in Europe and Asia. Look at the percentage of PV in Germany. All this happened in a timespan that is shorter than the planning cycle of a gas-fired powerplant.

James Tyson
January 9, 2013

As to Myth 2 regarding how the government should be involved: While renewable-energy subsidies may be politically challenging, a lot of Americans would find it very reasonable at this point to create a Carbon Tax with a rate that is adjusted each year to pay for the previous year's environmental catastrophes. People, insurance companies and governments in NJ & NY need financial help after hurricane Sandy. Farmers in the midwest need help after the droughts of this past summer; others need help after the fires and tornados of recent years. We should anticipate more of these events and associated costs to come. Taxing the cause of the problem is the appropriate response. We are causing these problems every time we burn carbon. We should pay for it every time we burn carbon. It is that simple. The money raised does not need to be used to subsidize renewable energy. Just adding the tax to the price of burning fossil fuels will be enough convince large numbers of people and businesses that it is time to make the transition to non-carbon energy sources.

Daniel Ferra
January 8, 2013

We don't even take into account the tremendous health cost to us and our planet, when we burn oil, coal, and natural gas, which would make them more expensive than Solar or Wind. We need a National Feed in Tariff, for Solar and Wind, with laws that level the playing field, this petition starts with homeowners in California. Japan, Germany, and our state of Hawaii, will pay residents between 21- 54 cents per kilowatt hour, here in California they will pay us 5 cents per kilowatt hour, and they wont let us oversize our Solar systems, want to change our Feed in Tariff? Campaign to allow Californian residents to sell electricity obtained by renewable energy for a fair pro-business market price. Will you read, sign, and share this petition?
http://signon.org/sign/let-california-home-owners
Go to Facebook, Daniel Ferra, Palm Springs Ca. to sign petition.

Daniel Ferra
January 8, 2013

The Feed in Tariff is a policy mechanism designed to accelerate investment in Renewable Energy, the California FiT allows eligible customers generators to enter into 10- 15- 20- year contracts with their utility company to sell the electricity produced by renewable energy, and guarantees that anyone who generates electricity from R E source, whether homeowner, small business, or large utility, is able to sell that electricity. It is mandated by the State to produce 33% R E by 2020.
All major energy sources in America are subsidized, and have been for a long time, to automatically remove subsidies for Solar or Wind at this time is not benefiting us or our planet, with the worlds carbon levels at 390-410 parts per million and rising, globally emitting over 32 Gigatons of CO2 each year, causing Global Warming and life changing pollution, Renewable Energy will address these issues and start us on the road back to 350 parts per million of carbon, Thank You Bill McKibben.
We are buying and selling clean air, all inhaling life sustaining pollution free air.
Accurate and honest accounting will have to be fought for, Solar does not get a fair shake on our current utility protocols because rules evolved for centralized large scale plants.
Allowing homeowners to oversize their Solar systems, is a true capitalistic tool, that will give us the potential to challenge the utility monopolies, democratize energy generation and transform millions of homes and small business into energy generators, during Sandy, Solar homes where not utilized to their full potential, because there was no disconnect and or transfer switch, to turn off incoming grid and start in home Solar power. how comforting it would be, to have mandatory transfer switches on all residential and small business renewable energy installations.

Cobus van der Merwe
January 8, 2013

Excellent article!

I fully agree on there not being an honest (i.e. transparent and 1-to-1 comparable) energy economy today. This needs to be addressed and articles like this and those referenced is a solid start.

Governments often site protection of energy sustainability as a national strategic objective. Great idea but unfortunately also based on an outdated concept - centralised energy provision as a government responsibility. Take the all too frequent power outages due a centralised network (regardless of cause) as example and it becomes clear that something is not working. Although some measure of regional network independence has been achieved by governements as a concept it still does not solve the problem in an economical way. Link the concept of incentive to policy change and allow individual businesses, communities and even citizens in their private capacity to set up self-sufficient generation and sell surplus into a local network. You have just resolved regional power blackouts as well as removed the strategic threat to national energy supply.

Use some of the billions curently spent on centralised national energy provison and set up a contingency fund to assist with re-establishing point self-sufficiency after disasters like hurricane Katrina.

The implementation of this could be further incentivised by kW/h sales based tax rebates (versus tax breaks which awards funds before guaranteed outcome and in some cases borders on turning key capabilities into government reliant 'welfare' concerns.

Should future building regulations at least make energy efficiency but ideally building energy self-sufficiency mandatory? Could be a great economic kick-start and also price reducer based on volume of sales for standalone energy solutions.

Lastly I concur that shifts in energy mix takes time BUT more can for sure be done to accellerate the transfer to cleaner, more economical and environmentally friendly solutions.

ANONYMOUS
January 7, 2013

Sorry -- Every National Academy of Science of every major country in the world confirms anthropogenic global warming, with the operative word being EVERY, and not a "vast majority."

Donald Wagner
January 7, 2013

I would have mentioned Germany for points three and four:

"We need new technology, period" - A residential installation is about 1/2 what it is in the US!! This has to do with time and cost to get permits and other soft costs.

"Can Alternative Forms of Energy Make a Difference?" - Germany has already had several days where 50% of the power during midday was from solar power plants.

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Michael Molnar

Michael Molnar has been involved in the energy and alternative energy markets for over a decade as an investor, investment banker, and sell-side analyst. Currently he is a Partner and Director of Research at a long/short asset management...