STOCK MARKET WATCH - Tuesday, 17 January 2012

[Demeter]

21. The Essentials for the Necessary Transition to a Renewable Energy Economy

http://www.alternet.org/story/153704/the_essentials_for_the_necessary_transition_to_a_renewable_energy_economy?page=entire

Unless we want to be indentured to an energy-military-financial complex, we need to build a new infrastructure for renewable energy. Fossil fuels are going to disappear, whether we like it or not. Petroleum, natural gas, and coal are becoming scarcer, harder to extract and a greater danger to the global climate. If we proceed with business-as-usual, energy companies will take advantage of increasing scarcity to dominate the world economy by vacuuming up more money from the 99%. They will be able to ally with military and financial institutions to construct an energy-military-financial complex that could eventually reduce most of the rest of us to a form of debt peonage. On the other hand, if we could possibly elect a government that does what governments do best – build infrastructure – we can avoid a world of global warming and economic collapse by building enough wind farms, solar panels, and geothermal systems to power our economy and ignite a sustainable, broad-based period of economic growth. Of course, this will require a sea-change in the direction of the political system, along the lines of the Occupy movement, but there is too much at stake to throw up our hands in despair....The unfolding energy drama presents progressives with several dilemmas. Some are suspicious that oil scarcity can be used as a ruse by the oil companies and speculators to spike prices. Roger Altman recently argued that a larger supply of fossil fuels will lead to less international tension. More generally, progressives sometimes fear that advocating for less oil use will be seen by the public as an attack on the American Dream of a car in every garage and a single family home for every family. But in addition to problems of scarcity and extraction, fossil fuels are bringing us towards extremely dangerous climate change. We need to have some answers or else the Right will simply keep up with the chant of “Drill baby drill.” It's time to counter with, “Build, build, build!"

Dirty fuels Create an Unsustainable economy

The question of the future of the supply of fossil fuels is not an easy one to answer. Oil producing nations, for instance, are not at all transparent about their supplies. Technologies constantly change, and so do environmental hazards. However, if we look at the current state of fossil fuel industries, it should be clear that we are in trouble.

• 1) Natural gas. Natural gas production is being kept alive by the development of hyrdrofracturing technology, or “fracking." As AlterNet has reported, an official with New York State stated that fracking will contaminate water supplies. His is only the most recent statement of a widespread concern about the dangers of this new practice. France has temporarily banned fracking, and New York State is considering how to proceed, but one would hope that the possibility of making New York City uninhabitable because of contaminated water would focus minds considerably...Beyond environmental concerns, the corporate hype surrounding fracking as a “game changer” is false. Even the Energy Information Administration, generally a cheerleader for the industry, predicts that with fracking American natural gas production will increase by only 31 per cent by 2035. That increase probably won’t even cover growth of the economy, and even so there is talk of exporting natural gas, which will decrease the amount available for domestic use even further. The problem is one that is endemic to the current fossil fuel industry – the conventional methods of extraction are leading to precipitous drops in production as fields are sucked dry, so extreme extraction is the only route left.
  
  
• 2) Oil. The environmental situation is at least as bad in the case of petroleum production, as we saw in the Gulf of Mexico in 2010. Despite industry trumpeting of new technological breakthroughs, the underlying fact is this: oil companies would not be oil-fracking, drilling multi-mile pipes underwater, exploring the Arctic and cooking tar sands if they could do what they did for the first 100 years of the oil age -- drill into pressurized deposits of oil that are conveniently situated below solid, dry, accessible land. The energy gained compared to the energy needed to discover oil has collapsed from 1200 to 5 in the last 100 years. By contrast, wind energy now returns 25 times the energy needed to provide it. Despite all of the new oil extraction techniques, global production of petroleum has stagnated since about 2005. This plateau in production is referred to as “peak oil” by activists who are concerned about how a civilization that requires oil for its transportation needs will survive if the supply should start to shrink precipitously. As scarcity leads to higher gasoline prices, economies stop growing, which leads to less demand for gasoline and then, temporarily, lower prices, until demand lifts the price again, and the cycle repeats itself. Meanwhile, in a desperate attempt to stave off the inevitable, societies encourage dirtier and dirtier methods of extraction. Nigeria, a major oil exporter, illustrates this irony. The problem of peak oil is exacerbated by the decrease in exportable production, because big exporters like Nigeria and Saudi Arabia keep using more oil for their own use. When the Nigerian government tried to eliminate gasoline subsidies, riots ensued, a process that has repeated itself throughout the oil-producing nations, thus decreasing the amount of oil available for oil importers. This rioting occurred at the same time that Nigeria’s oil rich delta experienced a terrible oil spill, an area that endures an Exxon-Valdez-sized spill every year. The Canadian tar sands may be the worst of all fossil fuel disasters, not only because thousands of miles of forest and large deposits of water are destroyed, but because the extra carbon emitted from these formations may mean “game over” for the climate, to use eminent climatologist James Hansen’s phrase. The reason Hansen is so worried about the tar sands is because his scenario for avoiding the worst of global warming is to stop using coal, but only if oil production peaks and declines, as peak oil activists predict. If more, dirtier oil flows, then you could shut down all the coal plants and the biosphere would still be in big trouble.
  
  
• 3) Coal. Coal use, at least in the U.S., is indeed declining , although not fast enough – and it is still increasing rapidly in China. But even coal is experiencing supply problems, as China has to import 40 percent of its supplies. The data on coal is even less reliable than the data for petroleum, but some experts have predicted a peak in production as early as 2020. Meanwhile, coal, like oil and increasingly natural gas, continues to wreak death and destruction on its environment.
  
  
• 4) Nukes and biofuels. Uranium is not a fossil fuel, but it is a fuel, as are biofuels, which also have very negative consequences for the environment. Fukushima may have begun to sound a death knell of the nuclear power industry. Even the French nuclear industry, which generates 80% of France’s electricity, has had to lay off employees because contracts to build nuclear power plants have been cancelled. It is becoming clear that biofuels usually cause more damage than benefits, by replacing food production, encouraging deforestation, and increasing pollution. The challenge for humanity is to stop using fuels and to only use renewable sources of energy from the sun, wind, and earth.
  
  Transitioning to a renewable energy society

For progressives, the fossil fuel crisis provides a great opportunity for equitable, sustainable economic growth. Since energy impacts all sections of society, all parts of the economy must become more just in order to solve the problem. Nowhere is this more evident than in the case of petroleum. While it would be much easier if Sammy and Susie Suburban could wake up in the future and drive their electric cars in just the same way they drive their oil-powered ones, this scenario seems very unlikely. The best way to reduce and eliminate the use of petroleum is to increase the density of town, suburban, and city centers, so that people can choose to walk, bike, or take electric trains such as subways and light rail, and so that slow, low-range actually-existing electric vehicles can cover the shorter distances needed. To make dense city centers attractive, however, a good educational system is required. As the current candidate for Senate in Massachussets, Elizabeth Warren, has argued, much of the expansion of the suburbs and the increased expenditure of family income has occurred in order to live in a good school district. Thus, because of the interconnected nature of the modern economy, it might turn out that the single most important way to solve the energy crisis is to improve urban schools!

The technology now exists to supply all the electricity we need by constructing wind farms, solar panels, and energy-efficient buildings. If progressives want to argue for the positive benefits of government, then they can advocate for a multi-trillion dollar program of government-led new energy infrastructure, which would employ tens of millions of people and rebuild the key to our economic prosperity, our manufacturing base. It is exactly because the energy, military, and financial elites will benefit from fossil fuel scarcity that progressives need to tackle the problem head on. In rebuilding the infrastructure, the economic fortunes of the 99 percent can be revived as well.

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Jon Rynn is the author of the book Manufacturing Green Prosperity: The power to rebuild the American middle class, available from Praeger Press. He holds a Ph.D. in political science and is a Visiting Scholar at the CUNY Institute for Urban Systems. In the spring he will be participating in a global teach-in (globalteachin.com), incorporating these and other issues.