Energy and the Environment
by Henry Kelly, President of FAS

Finding a sustainable way to provide the 9 billion likely people to be alive at the end of this century with a reasonable level of prosperity presents an extraordinary scientific, technical and political challenge.

The average person on the planet today consumes energy at a rate of 2 kilowatts (kW), but about two billion people alive today don’t use much more commercial energy each than Homer did. Americans, however, use an average of 11.5 kW, and the average Western European uses roughly 5 kW. As the world’s population increases from six billion to nine billion during the coming century, and the typical person enjoys the lifestyle of a typical European today, total energy use will quadruple.

Can we possibly meet the energy requirements of nine billion people while delivering a prosperous lifestyle? There’s no question that it’s technically possible to solve this problem. Resource constraints need not limit growth if we’re willing to keep pushing the frontier, since we’re nowhere near the theoretical limits in providing modern amenities. For example, we can make enormous gains in transportation by paying attention to simple things like urban design, advised transit strategies and new technologies for vehicles and fuels. Advanced technology has scarcley touched traditional industries like housing. And biological systems- which manage to operate human brains on much less power than a Pentium III and run nanodevices that assemble systems like ears out of simple raw materials- provide clues to possible gains in manufacturing and energy efficiency.

Yet while much is possible action has been anemic. Private investment in research has declined because incentives for invention are weak. Simply increasing the price of fuels to reflect the environmental and security costs associated with each would appear an easy solution. But US politics demands that energy prices keep low. A confusing mixture of incentives and regulations may have helped; they are often offset by production subsidies that keep prices artificially low. Since the full cost of energy consumption is not reflected in market prices, private incentives for innovation in energy efficiency supplies are well below optimum.

The political process is stalled with environmentalists and the Bush Administration engaged in paralyzing ritual dance. The administration emphasizes technology as a long-term fix; environmentalists argue that this is an excuse for doing nothing, and want immediate regulatory requirements forcing change. Both are only partially right. The Bush Administration is right to argue that over the ling term, radical technological change is essential to any solution- after all, we’re looking for 300% improvement, and the kinds of regulatory changes the environmentalists want are likely to be overwhelmed quickly by the sheer pressure of growth. Suppose, for example, automobile fuel economy standards were increased 30% over 10 years: growth in energy consumption would be slowed, but thirteen years after the program started, consumption would be back to where it originally was.

At the same time, environmentalists are right to argue some changes must be forced now, as their effects will linger for decades. It can take a generation for a new automotive technology to become dominant on the road. For example, a new auto design available today would take a decade to become the dominant new vehicle sold and another decade to become the bulk of the fleet on the road. Houses built today will be around for a century. With nearly two billion people likely to move into large urban areas during the next five decades, decisions made about these communities’ layouts will potentially haunt us for generations.

To maintain the flow of innovation, a large and sustained investment in research will be essential, as will programs to test concepts at a significant scale as they become practical. For example, while there’s good reason to believe that US energy consumption can be cut by at least 30%, with cost-effective technologies, some of these needed innovations are unlikely to be able to compete with cheap Middle Eastern petroleum and natural gas.

The Administration’s plan to spend $1.2 billion on hydrogen research over 5 years is clearly a worthwhile effort. But it will scarcely let the US catch up to the level of spending in Europe and Japan in similar areas and is hard to take seriously, since it’s proposed budget to renewable energy and energy efficiency (which includes most of the hydrogen research) is lower than the 2002 budget for the same field. Moreover, the budget cuts funding for energy efficiency research by nearly 15%. Not only will much critical work go unfunded, but broad cuts will cut development and testing needed now on technologies like super-clean diesels for hybrids and alternative liquid fuels that may be easier to introduce than hydrogen.