Economics, Environment and Energy

The increase in the retail price of electricity as a result of 80% renewables penetration (in the US) by 2050 is estimated at some $30/MWh.  The current average retail price is some $13/MWh.  Such high penetration depends in large part on technologies that don’t yet exist.  The Australian Greens ‘plan’ is for 100% renewables by 2030.  What’s a more practical alternative?

Black carbon, sulfate, nitrous oxides, methane and chlorofluorocarbons are all pollutants caused by human activities – from burning fossil fuels but also from cooking fires and burning forests and grasslands.  Methane comes from mining and pipelines, sewage treatment, piggeries, cattle feedlots and landfill.  They are enormously harmful to human health and global ecosystems.  Chlorofluorocarbons are a legacy gas used as a propellant in spray cans and in refrigeration.  They destroy radiation shielding ozone in the stratosphere.  There were ready replacements and they were banned in 1996 – but still are 2% of global greenhouse gas emissions.  

Black carbon has a climate forcing of some 1.1 Watt per square meter (Bond et al 2013) – more than carbon dioxide from electricity production.  Sulfate is nominally cooling – although this is confounded with the lensing effect in mixed black carbon, sulfate and primary organic aerosols present in all anthropogenic (human origin) emissions (Gustafsson and Ramanathan 2016). This amplifies black carbon warming 2.4 times.  

“Time-course evolution of BC aerosol composition, light absorption (where EMAC-BC is the enhancement because of coatings), and associated climate effects (as DRF).”

Source:  Gustafsson and Ramanathan 2016

For the future the imperative is to invest in energy research and development – not least because without the innovation windfall future economies are at risk. I’m not adverse to even wind and solar. It adds some 10% to my bill for some 7% of electricity generation. Although for some time hugely skeptical – I would count the experiment a success. Levelized costs of wind an solar are now lower than alternative sources of electrons – and solar is now on the verge of another technology revolution. But despite the heroic modelling of the US National Renewable Energy Laboratory (NREL) we are now at physical and technology limits.

The graphics below show the energy mix and the increased cost for 80% renewables by 2050.  The current average retail price of electricity in the US is $13/MWh.


Source: NREL Renewable Energy Futures Study

At this right price – the principle of economic substitution kicks in.  With the right technology – and there are dozens in development – Schumpeter’s principle of creative destruction of capitalism will revolutionize energy systems.  

Emissions of black carbon, sulfate and nitrous oxides are neither necessary or desirable from power plants or transport.  Modern power plants emit virtually no (0.01%) pollutants – and reduce greenhouse gas emissions by 10%.  They are very much at the forefront of current ASEAN development and energy planning.  All consistent the Paris emissions accord.  Greenhouse gas emissions from power plants are some 25% of total greenhouse gas emission, transport 14%.

Source: ASEAN’s Energy Equation

Technology for reducing black carbon emission is very advanced in modern vehicles.

Source:  Bond et al 2013

Some nitrous oxides come from vehicles – and about half of volatile organic compounds. These complex in sunlight to form damaging photochemical smog. They are amended in modern vehicles with catalytic converters and complex engine management systems that burn air and fuel at a near perfect stoichiometric ratio.  Most anthropogenic nitrous oxides come from applications of nitrogen fertiliser.  Precision agriculture overcomes by applying nitrogen where, when and and in the quantity needed.  It lowers cost, increases productivity and safeguards downstream environments.  Nitrous oxides are about 8% of greenhouse gas emissions.

Methane is not damaging in itself – unless it blows up. Methane is derived from anoxic digestion of organic material. Fugitive emissions from mines and pipelines is an economic cost. Other sources include sewage treatment, landfill, piggeries and cattle feedlots. Anoxic digestion of organic matter creates creates methane and soluble and mobile forms of nitrogen. When accumulated in groundwater used in baby formula nitrates inhibit oxygen assimilation. In streams and oceans they result in eutrophication. Methane from responsible waste management provides cost competitive energy sources. Methane is about 14% of total emissions.

Progress has been made – as you can see in the regional pattern of black carbon emissions.  Wealthy countries are doing better than less developed.

Source:  Bond et al 2013

Further progress can be made with continuing economic growth. Including on emissions from farming and forestry – some 24% of the total. This can be radically turned around with existing technology and management systems to double food production by 2050, enhance flood and drought resilience and to stop soil washing away losing fertility in farmland and degrading downstream environments.

Source:  Heritage Foundation 2019 Index of Economic Freedom

Increased agricultural productivity, increased downstream processing and access to markets build local economies and global wealth.  Economic growth provides resources for solving problems – conserving and restoring ecosystems, better sanitation and safer water, better health and education, updating the diesel fleet and other productive assets to emit less black carbon and reduce the health and environmental impacts, developing better and cheaper ways of producing electricity, replacing cooking with wood and dung with better ways of preparing food thus avoiding respiratory disease and again reducing black carbon emissions.

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