Keep your eyes on the stars and your feet on the ground

I can see a number of reasons why it’s turning out so difficult to reduce worldwide CO2 emissions.

Firstly, lower than expected demand for a commodity results in lower prices making a further reduction in demand more difficult. Coal is a clear example. Coal producers have for a long time overestimated demand resulting in a decade of overinvestment. Resulting low coal prices led to increasing demand (be it not as high as initially expected) and an increase in the coal market share of global primary energy (in spite of it being the most polluting fossil fuel). This is a global phenomenon except for the U.S. where abundant low cost shale gas has taken away market share from coal.

Secondly, the benefits of CO2 emission reductions are global and long term; the associated costs are local and are incurred now. This implies that there is always a strong incentive to cheat.

Thirdly, oil and gas producing countries have a strong interest in the continued use of fossil fuels and they will continue promoting and subsidising them. Energy intensive industries are migrating to low cost energy countries. A significant and growing part of Saudi Arabia’s oil production is used for local industries (petrochemicals, metal processing), generating a second income stream in addition to oil production. To some extent this also applies to the U.S. where a rapid increase in low cost shale gas production has resulted in a long term reduction of electricity prices; a significant competitive advantage for any U.S. energy intensive industry.

Fourthly, the benefits of economic progress (with an associated energy consumption increase) for undeveloped countries are real. Global warming concerns people in undeveloped countries as well but when asked to rank issues it comes out last (way below security, food, education, health and energy and transport related issues). In fact it comes out near the bottom of the list in most countries except for the most highly developed ones.

What should we do?

Let’s be realistic. In all likelihood the emission reductions needed to limit CO2 levels to those in line with the COP21 targets will not be met. It is easier to promise than to deliver – especially if deliverance is scheduled so far ahead in the future. In spite of all earlier efforts the shares of fossil fuels and renewables (hydro, wind, solar) in the global primary energy mix have remained virtually unchanged over the last 20 years (at approximately 80% and 3% respectively).

So what can we do? Global warming is too important to put all our eggs in one basket. At this early stage it is not clear which technologies will be the most successful in coping with it. There are limits to the extent to which renewables can easily replace fossil fuels. So let us subsidise technologies without being dogmatic. Whether it is solar, wind, CCS, “new” nuclear, electric or hydrogen vehicles, energy storage, ways of increasing efficiencies of conventional technologies, etc. Learning and economies of scale will reduce cost, as they have most successfully done for solar.

Let us find the best compromise between reducing emissions, security of supply and affordability. Just aiming at reducing emissions, without any consideration of the ability of our industries to compete on a global basis, may result in a lack of public support for necessary measures (doing more harm than good in the long term).

Many people in the oil and gas industry look at the Energiewende as a total failure, given that it did not make electricity generation in Germany any cleaner or more affordable (and did not make its supply any safer). The continued operation of lignite mines and the closing down of nuclear reactors that generated clean, safe and cheap (reactors being paid for a long time ago) electricity is indeed difficult to defend. It can only be understood as a necessary measure to obtain support for the Energiewende, given the German political landscape and lack of public support for nuclear power.

But the Energiewende did result in a staggering demand growth for solar panels, greatly contributing to a reduction in cost (long term cost reduction for every doubling of solar capacity has been an impressive 19%, vs. 7% for wind). This is a real and substantial long term achievement. Unsubsidised utility scale solar and wind generation of electricity is now becoming cost competitive under many conditions. There is no stronger incentive than having a clean(er) alternative that is actually cheaper.

Having said this, at this early stage, where the combined share of renewables of the global primary energy supply is still minimal, it is not about cranking it up as quickly as possible by a few percent; it is rather about developing and perfecting techniques that can bring it up to much higher levels in a cost efficient way in the long term.

We may also have to take more drastic measures. Note that whilst emissions in many developed countries have started to decline, this has more to do with a shift of industries towards undeveloped countries than an actual decline of emissions on a global basis. From 1990 to 2005 Britain’s CO2 emissions reduced by 15%, the CO2 emitted by producing all the products consumed in Britain increased by 19% however. The increasing divergence between “produced”and “consumed” CO2 is a Europe wide phenomenon (be it that for the EU 27 as a whole it tends to be less pronounced than in Britain). Given the unlikelihood of global carbon taxes we may have to resort to border carbon taxation (taxing goods imported from countries without carbon taxes). It is of no benefit to the climate if CO2 emissions in developed countries are reduced because industry is being moved to undeveloped countries.

In fact, we may well have to face the fact that the recent Paris agreements have only a chance of reaching their objectives if citizens accept that this will involve a drastic change of lifestyle. Reducing CO2 emissions in electricity generation is relatively easy (up to a certain level at least, pending advances in energy storage). For road transport it is already more difficult. Electric vehicles will take off but for mass scale usage we may well run into restrictions on the availability of certain commodities. Flying and a substantial part of industry usage offers even less scope for CO2 emission reductions. This is not about putting a few solar panels on the roof. This is about not eating meat, not flying and driving substantially less. Governments should be clear about that.

Geoengineering

So let us do all we can without being dogmatic. This includes looking at geoengineering solutions, controversial though they may be.

Out of many geoengineering options albedo enhancement by creating a sulphate aerosol in the stratosphere seems by far the most technically and financially feasible. The limited costs imply that it will be well within reach of many countries. The seminal 2006 paper by Noble prize winner Paul Crutzen presents the case for albedo enhancement and while explicitly advocating more research I feel the implicit message was to warn people that this is the future if we do not start to reduce emissions drastically (and stir governments into action on reducing emissions – by far his preferred road ahead). An overview of geoengineering options and recent developments is given in a book by Oliver Morton (one of the Guardian’s best science books of 2015).

We are already doing this: the cooling effect of human aerosol pollution is real, its magnitude much more uncertain than the warming due to the CO2 greenhouse effect but our best estimate is that it currently cancels close to half of it (it is a much more short term effect though due to the much shorter atmospheric residence times of these aerosols compared to CO2). The recent acceleration of global warming is likely to be related to the reduction of aerosol pollution on a global basis (whereas the near constant global average temperature in the 1940 – 1970 period seems related to the rapid increase of aerosol pollution). Past major volcano eruptions have been an intermittent, natural, cause for stratospheric aerosols and associated cooling over 1 – 2 year periods. The adverse health effects of a stratospheric sulphate aerosol needed to counteract (a fraction of) greenhouse gas induced warming are minimal compared to those caused by the ongoing human created sulphate aerosols residing at much lower altitude.

The longer that we see rising CO2 emissions, people in developed countries not really changing lifestyle, people in developing countries moving to the lifestyle of people in developed countries and limited progress on CCS or nuclear power, the more likely that we will need to resort to geoengineering. If only to buy us more time for fundamental solutions.

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One Response to Keep your eyes on the stars and your feet on the ground

  1. Pingback: The Future of Oil Companies: A Slow Decline – Enjeux énergies et environnement

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