Economist Debates
First Rebuttal in Economist Debate
Note: This is the first rebuttal in the debate. The second will be posted on Feb 2.
Implicit in the arguments put forward by Steve Sawyer are assumptions that governments have infinite supplies of money and land. They do not.
Governments around the world are cutting renewable subsidies. The Los Angeles Department of Water and Power is cutting its 35% renewables goal because it has no science or “economic means testing” to support it. Spain and Germany are slashing solar subsidies. Meanwhile, Europol is investigating a €5 billion fraud within the EU’s Emission Trading System.
Were we debating energy subsidies, I would eagerly argue for elimination. Let power sources compete, fair field, no favour. Renewable-energy lobbyists will not agree because their industry depends on taxpayer cash. While the $500 billion-700 billion in hydrocarbon subsidies cited by Mr Sawyer is notable and tawdry, the essential question is the rate of subsidisation. And that is where the fiscal foolishness—and even the immorality—of much of the renewables parade stands naked.
German grid owners are now required to buy solar-generated electricity for some $0.40 per kilowatt-hour—that is nearly four times the price of electricity for industrial customers in France.
Mr Sawyer dares not mention the biofuels disaster in his plea for renewables. And yet this year, the American corn ethanol industry alone will chug down nearly 5 billion bushels of corn. That is 40% of American corn, 15% of global corn output and 5% of total world grain production. And it is doing so in order to produce just 900,000 barrels per day of ethanol—the energy equivalent of less than 1% of the world’s daily oil needs.
Congress mandates, provides tariffs for and subsidises the production of corn ethanol to the tune of $1.78 per gallon. And in doing so, it has engineered an inflation multiplier. As oil prices rise, so do incentives for ethanol-makers to produce more, which boosts grain demand, which then makes food more expensive.
On Tuesday night, President Barack Obama said that America can “break its dependence on oil with biofuels”. He is dreaming.
Advocates of renewables—along with every sentient human—should be loudly disavowing all food-based biofuels. It is immoral to be burning food to make motor fuel at a time when food prices are rocketing and street protests over food prices are now flaring up again just as they did in 2008. Recent protests have been seen in Jordan, Tunisia, Mauritania and Algeria.
Renewables simply cannot overcome physics and economics. Promoters of renewables argue that we should replace high-power-density sources—that generally means hydrocarbons—that are dispatchable, reliable and low cost with low-power-density sources that are not dispatchable, incurably intermittent and high cost. And in their futile attempts, they demand subsidies.
The best way to decarbonise the global economy in the near term is with cheap, low-carbon fuels, and thanks to the plenitude of methane, that is possible—without massive subsidies.
Many countries have had major gas finds in recent years. Israel discovered some 25 trillion cubic feet of natural gas—the energy equivalent of about 4 billion barrels of oil. It will use that gas to replace most, if not all, of its coal-fired power plants.
Basic physics and simple maths show why renewables are not viable on a large scale. And given that biofuels and wind energy are the renewable darlings of the moment, let’s look at how they might work in a country like Israel.
Israel has a land area of about 22,000 square kilometres. A big user of electricity, it has about 11 gigawatts of electric generating capacity. Let’s assume the Israelis wanted to use biofuels or wind to meet half (5.5 gigawatts) of their electricity needs. Those two sources can each produce about 1 watt per square metre of land. (These are commonly accepted power density numbers. For instance, see the work by Vaclav Smil.)
Producing the desired 5.5 billion watts of renewable power would therefore require 5.5 billion sq. m, (5,500 sq. km)—about one-fourth of Israel’s land—to be used for nothing but fuel crops or turbines. And that assumes Israel gets enough rain for the biofuels (no droughts allowed) and/or enough wind (no calm days allowed). And remember, we have not mentioned Israel’s need for transport fuels.
Finally, astonishingly, Mr Sawyer says that natural-gas-fired plants “will need to be phased out starting in 2030”. Huh? Phased out in favour of what, exactly? Unobtanium? If renewables are to gain market share, they must rely on natural-gas-fired power plants unless or until ultra-cheap energy storage becomes available.
Energy storage has long been renewables’ Holy Grail. And in the two centuries since Alessandro Volta invented the first battery, inventors have been trying to develop reliable, cheap, high-capacity batteries that can work at the grid level. They have largely failed. With the exception of geothermal, renewables cannot produce baseload power or be dispatched. That means their value is far lower than that of conventional sources. (See this recent study by MIT economist Paul Joskow.)
Now, if Mr Sawyer will agree that reprocessing spent fuel rods qualifies nuclear power as a “renewable”, then I will gladly join his side in this debate. If we are serious about reducing carbon emissions in a cost-effective way, we need to embrace N2N: natural gas to nuclear.
Original text here: http://economist.com/debate/days/view/646