Writing scenarios about energy is about as hip as writing science fiction about time travel or Moon colonies. Energy scenarios are, after all, the “original” scenarios. They are the vanilla of ice creams, the beige of home decorating, the Ryan John Seacrest of celebrities.
Scenarios actually began, for the most part, in the energy industry because, in a crazy and shifting world, that industry has always needed to take a long-term view and make long-term investments. That’s why so many people in that industry give off a vibe that is weirdly geeky as well as stodgy and superior. It must be the cross-breeding of engineers and geologists, gutsy wildcatters, fat-cat corporate diplomats, and egg-headed forecasters.
Don’t ask me to explain my particular enthusiasm. I guess I just think it’s, well, important. Perhaps I picked up the energy bug from the study of scenarios in general and some exposure to energy companies. At any rate, I have been thinking and reading about it more lately and participating in online discussions, the latter being the mark of someone who has entered a rather alarming and perhaps incurable state of nerdiness. So, here are some my thoughts all nicely wrapped up in four scenarios. (And, yes, to you scenario snobs, I will be picking one I prefer and one I find most likely).
Arctic Lichen Slow
In the year 2031, green energy still grows slowly, like some kind of arctic lichen. Thanks to China’s interest in solar, the price of panels has continued to come down, but not at the exponential rate that some folks had predicted (see last blog). Wind energy has become more mainstream, though storage technologies remain a problem. Biofuels, with the help of the U.S. military, have gotten cheaper and become a regular additive to consumer as well as military aircraft. And engineers have done a pretty good job of making automobiles more fuel efficient, not just through better batteries but the more efficient engineering of all the other components, especially the not-yet-dead combustion engine. Most cars, after all, still run at least partly on petroleum. Many believe that we’ve already hit the dreaded “peak oil” phenomenon, but new extraction techniques have kept the pumps flowing enough to keep the price of gasoline bearable.
In fact, 76% of all energy production is still based on fossil fuels (only about 4 percentage points of improvement from 2011). Natural gas remains a denser, cheaper fuel source and the energy grid increasingly runs on it, especially in the U.S.
But with China and India and growing parts of the African continent still ramping up their economies and energy usage, there’s even more trepidation about global warming. The scientific news has not been too good in this area – in fact, there has been an ever greater amount of global hand-wringing, with many believing we’re already past a point of no return for considerable warming.
This problem has set the stage for a carbon tax that will be implemented by all G25 countries in 2032. The funds will be mostly allocated to three areas: 1) further bringing down the prices of renewable technologies to the point where they can compete with natural gas (though not robot-mined coal), 2) greater energy conservation regulations in all forms of engineering, and 3) smaller, cheaper and safer nuclear plants.
“Look,” says one energy guru, “we’ve made a lot of progress over the last 20 years in terms of bringing down the costs of renewables, but they haven’t grown that much as a percentage of all energy. Still, global warming has finally gotten bad enough – and the technology good enough – for us to make a global push. We predict that if the political coalition holds, then by 2050 we can get things down to just 60% fossil fuels and the rest nuclear and renewables.”
In the year 2022, a major threshold was crossed. Solar photovoltaic costs dipped below 14 cents per kWh and suddenly became just as competitive as conventional sources of energy. It had been a long road, but this represented the start of a phase change, especially given that the costs were expected to continue to sink further for another five to ten years. Going with other fuel sources started to look like a rotten investment, which meant the lower costs came even more quickly thanks to new investments.
But today, in the year 2031, it’s not all about the photovoltaics. There have been many advances since the first big influxes of investment capital into energy technologies earlier in the century.
Fuel cells, although not a new technology, have made a lot of progress as a way of cheaply storing solar energy. Most new homes in the U.S. are sold with solar panels and a collection of fuel cells for storing any energy that doesn’t go directly to the electric grid. In addition, most windows are installed with clear carbon nanotube films that can reflect and collect solar energy, depending on the needs of the home. There’s also a big business in retrofitting older homes.
This means that a growing number of energy consumers have become energy producers or energy neutral, a situation that has made many utilities very nervous, especially after several decades of slowing usage among home owners in the U.S.
There have also been advances in wireless energy delivery. The most prevalent technologies are based on lasers and magnetically coupled resonance, allowing a wide range of wireless devices to run in households without the need for wires and plugs. But the largest benefits stem from applications that allow neighborhood homes to “share” solar energy via ad hoc, computer-controlled and wireless grids.
There are still plenty of traditional fossil fuel power plants, of course, but renewable energy is now estimated to make up 15% of energy produced in the U.S., a proportion that is expected to rise very quickly.
“We expect to the US. To hit 40% renewable energy by 2050,” says one utilities CEO. “It represents an amazing achievement. While humanity hasn’t exactly ‘solved’ its energy problems, it feels like we’re on the road to a sustainable future. As an industry, we’re now looking at other markets where we can be equally as successful, especially the transfer of information via utility infrastructures.”
Hot and Dirty
Global warming continues to heat things up. At this point, everyone just assumes we’re going to need to deal with the repercussions of rising sea levels, greater desertification, the extinction of species, and many other problems.
But the world has bigger fish to fry. China and India and plenty of other nations continue to ramp up industrialization and they must do it on the cheap as their economies start to slow down in terms of annual growth rates. China’s government, in particular, is deeply worried about maintaining political control. It has built many nuclear plants but has given up on pouring money into solar because of declining global demand. To make up the energy difference, it continues to build coal-fired plants and has exported its expertise in this area to India.
Meanwhile, the U.S. relies primarily on natural gas, petroleum, and coal, the latter being a serious topic of political debate. The U.S. has actually started exporting natural gas to nations where air pollution as become most abysmal, and the extraction technologies have grown better and better.
In the U.S., renewables remain stuck at the same 3% of all energy production they’ve been since the 1970s.
“Environmentalists have given up on renewables becoming price competitive in this era,” states one think-tank analyst. “Now, it’s all about trying to push natural gas and building more of the kind of small, modular nuclear plants that China has done a lot of the basic R&D on. At least in the short term, nuclear remains the best answer reducing greenhouse gases.”
Down and Dirty
Around 2020, two things happened almost simultaneously. The first was that new information threw the best global warming projections into doubt. Even the most avid believers of global warming in the scientific community regarded this as good news: that the atmosphere has a greater ability to absorb CO2 without warming than had been originally believed.
Second, a group of governments and major private investors agreed to pour billions into geoengineering technologies. They projected that within 20 years, they could absorb over 30% of the carbon that had been dumped into the atmosphere over the last 100 years.
Despite warnings from environmental groups, these two developments have, in the words of one engineer, “freed coal.” Coal is by far the most abundant and cheapest fossil fuel thanks to new robotic technologies that allow it to be mined very cheaply and safely.
Within years, problems such as acid rain and mercury poisoning returned on a global scale and new global regulations were implemented in 2029, but no one is talking about doing away with coal anymore. The “clean coal” moniker is seen everywhere.
“We’re getting down and dirty now,” says one U.S. miner. “The server farms are everywhere in the U.S. and they need juice. Plus, China manufactures just about everything now and we give them the coal to do it. India wants it too. We’re the new Middle East of coal, baby.”
In the meantime, investment in renewables has dwindled to almost nothing and nuclear plants are relatively expensive to build. Coal rules the day and contrary to previous expectations, it looks to be the fuel of the 21st century.
Alright, this is when I’m supposed to say, “We just don’t know which of these is most likely, and planners should keep all of them in mind in order to better prepare for and react to the future.” But here’s what I really think: Scenario One is most likely at this point. We’ll move toward renewables slowly (but with increasing speed) over of the next 20 years, with natural gas and, possibly, nuclear playing roles as intervening technologies. I don’t think we’ll see anything from fusion during this time.
The scenario I’d like to see? Color me green, partly because it’s just plain more exciting. Scenario Two is where the cool new innovations will be, where humanity really shows its spunk and its can-do-it-ness, where geeks and environmentalists and venture capitalists and Chinese manufacturers all hold hands and sing “We Are the World.”
Alas, I think Scenario Three is more probable. I just read an article in the Sydney Morning Herald saying that International Energy Agency announced we only have five years “to avoid dangerous global warming of more than two degrees celsius.” The report itself stated, “If stringent new action is not forthcoming by 2017, the energy-related infrastructure then in place will generate all the CO2 emissions allowed in the 450 Scenario up to 2035, leaving no room for additional power plants, factories and other infrastructure unless they are zero-carbon, which would be extremely costly.”
And I’m sitting here thinking, “Yeah, right. No way anybody is going to stop building new dirty plants or factories even once that threshold is crossed, not without some major political and economic repercussions.”
No, if the vast majority of the climatologists are right, then we’re going to have to settle in for some serious heat. We’re not going green or even nuclear fast enough to prevent it, from what I can tell. On the other hand, maybe the projections are just plain wrong, as much a figment of the hand-wringing liberal media as the talk radio boors would have us believe. If so, that’s good news. Yet I doubt it. I think we’re headed toward a greener world but it’ll come later than many hope, making room for the folks nobody wants to call in yet: the dreaded geoengineers who will mess with the environment the way the Fed messes with the economy, yanking out CO2 or building solar-reflecting cloud cover or any number of other strategies.
So, welcome to the 21st century: it’ll probably be hotter and stormier and more ecologically fragile than we’d like, with insurance companies writing some serious policies for folks living on coastlines (that’d be me, by the way) and engineers trying to undo a lot of the stuff we just did. Ah well. It wouldn’t be the first time we collectively screwed up, and I’m hoping it won’t necessarily be the last.