The Sustainable Home Blog

Combine peak oil with 1,500 mile farm to table transportation costs and 10 calories of fossil fuel energy consumed for every 1 calorie of food energy produced, and you have the perfect formula for a looming food crisis. I’ve speculated in the past that we will have to return to the citizen farmer victory gardens of WWII to build a secure bridge to a more sustainable food delivery system, however a Colorado entrepreneur has demonstrated that there is money to be made in converting the front lawns of suburbia into the organic farms of the future.

Transforming Suburban Landscaping from Ornamental to Edible

Kipp Nash under the banner Community Roots has created a suburban front yard farm network in South Boulder Colorado’s Martin Acres neighborhood. Homeowners donate their yards and Nash replaces their front lawns with beautiful and edible organic vegetable plots. Nash manages all of the planning, planting, weeding, irrigating, and harvesting and the homeowners are paid in organic produce. Community Roots sustains its operation by selling excess produce at local farmers markets or through it’s own CSA.

This is a business model that is healthy, local, sustainable, profitable, ecological and destined to grow by duplication in communities around the nation.

With price tags ranging from $15,000 to $50,000 or more for residential PV [photovoltaic] systems, the residential market has been limited to homeowners with a strong green ethic that either had the cash or were willing to tap into their home equity to pay for the cost of a system.  Given a 15 year plus payback and an average home ownership turnover of 5 years that represented a pretty small population of potential customers.  As a result, it was only a matter of time before entrepreneur’s realized that the PV industry had reached a point where it needed more financial innovation than technical innovation.

Power Purchase Agreements [PPAs] are offered by companies that are basically independent, solar electric utilities.  They use your south facing, roof-top real estate to install PV [photovoltaic] panels at their expense and then sell that energy back to you at a pre-determined rate under a long term PPA agreement.  Solar PPA’s represent over 50% of large commercial and industrial PV installations, and if you’re a big box store like WalMart, the economics are such that you pay zero upfront cost, lock in favorable long term rates and never have to worry about how it works or the costs to maintain the system.

Until recently, the PPA business model has been non-existent for the residential market, however two California companies now offer forms of residential PPAs to qualified homeowners.  Sun Run of San Francisco offers an 18 year residential PPA that requires an relatively modest (~30% of the system cost) upfront payment by the homeowner and Solar City Inc. of Foster City offers as low as a no money down 15 year lease to highly qualified (≥720 credit score) homeowners.  Whether it’s called a lease or a PPA the end result is the same, the company owns, maintains, and profits from the system and the homeowner pays a monthly charge that is off-set by their savings in electrical costs.  It’s a win-win-win situation for the company, the homeowner, and the environment.

To answer the “what happens if I move” question, both Sun Run and Solar City offer their customers the option of buying the system at any time, transferring the PPA/lease to a new owner, or renewing the PPA/lease agreement at the end of its term.

You’ve got to love the potential for the PPA business model to expand the residential PV market to millions of additional homeowners, but what are the factors that make it technically and financially viable for a companies like Sun Run and Solar City, and why are these programs currently limited to California?   The answer lies in tax credits, rebates, and utility rates, and in the case of California all of these factors are aligned to make the numbers work.

Whether it’s a lease or a PPA, since the company owns the system they get the tax credits and any state or utility rebates.  In the case of the Federal Investment Tax Credit [ITC], because they are a business, they get the full 30% credit and are not capped a $2,000 like us lowly homeowners.  Because the Federal ITC is scheduled to expire at the end of 2008, the PPA/lease business model may fall apart if it is not renewed.  If not renewed, the economics would probably dictate that the homeowner cover an additional 30% of the purchase cost upfront making the deal considerably less attractive.

Other factors that make the model work are the relatively high California utility rates and favorable net metering laws.  Additional requirements include an unobstructed southern exposure for the panels, a roof surface that will last the lifetime of the PPA or lease, and a system that’s large enough to make economic sense for the company.

If the Federal ITC gets renewed for several more years, look for both of these companies to rapidly expand into states with relatively high utility rates and strong incentives for renewable energy.  As utility rates inevitably increase and PV panel costs decline, this business model will only get stronger.

Some 70 years ago we began our grand suburban experiment.  A utopian vision of a tranquil and natural setting for our nations homes.  Garden communities full of happy children and the promise of tomorrow.  I grew up in one of these vast suburban tracts near Long Beach, California.   Our new 1,000 SF 3 bedroom, one bath home was one of thousands built of  returning WWII veterans and their families.  It’s detached one car garage housed our family car and in 1950 the men used that car to commute to and from work and the women stayed home to raise the children.  The white collar dads worked 9 to 5, and the blue collar dads 8 to 5 with an occasional overtime shift.  For the most part all the dads were home on the weekends.   Black and white TV’s and record players were the extent of our electronic life, and drive-in movie theaters and burger joints extended our automobile lifestyles.

As the population grew, new roads and freeways would be built and eventually a sprawling suburban would spread from north of Los Angeles south to San Diego as far the the Mexican border and from the Pacific coast to inland desert.  Progress would bring us two hour one-way commutes, two income families, and three car garages as we became trapped in lives that could only be lived by driving 20 and 30 thousand miles a year.  Our original utopian vision of peaceful tranquility would instead become one of road rage and isolation, and leave us obese and addicted to tranquilizers.

Today, I wonder what will become of this grand experiment as the production of oil peaks and we can no longer afford our auto dependent lifestyles as gas prices first reach $5 and then $10 per gallon.  Will we become a nation of telecommuters?  Will zoning laws change so that our suburban neighborhoods become sprinkled with offices, cafes, and small shops?  Will our suburbs become sufficiently urbanized (see Drivable Suburbanism v. Walkable Urbanism) so we can get to work, restaurants, and stores by foot?   Or will vast tracts of suburbia just be abandoned for something more sustainable and the land returned food production?

“[The President] shall from time to time give to Congress information of the State of the Union and recommend to their Consideration such measures as he shall judge necessary and expedient.”
The United States Constitution, Article II, Section 3

Members of Congress, madame Speaker, distinguished guests, my fellow Americans…as many who have come before me, I stand before you this evening to fulfill a constitutional obligation. The first State of the Union address was delivered in straight forward manner to a newly formed congress by George Washington on January 8th, 1790. However, some two century’s latter, this time honored tradition has in devolved into political theatre with standing ovations predictably limited to one side of the aisle and political points cynically won from guests planted in the gallery. The American people deserve better, so this evening I will depart from my prepared remarks and tell the people of America and of the world what they need to hear rather than what they either want or expect to hear. Many will not like what I have to say, but this union and the world stand at a cross roads and there is no better forum than this to address this critical moment in history.

When George Washington delivered the first address in 1790 the population of the world stood at approximately 1 billion and the population of our new fledgling country was less than 4 million. Our nation’s borders had yet to reach the Pacific and many parts of the earth, including our great western states were still unexplored. Mankind’s footprint on this world was still relatively small. At the beginning of our nation’s life, it was just and reasonable to limit the focus of this address to our new and fragile union. However, today we cannot understand the state of our union without first putting it in both its historical context and in the context of the state of our planet. To do otherwise, would be to put us in grave danger.

In contrast to the time of Washington’s address, the population of the earth today exceeds 6.6 billion and our country’s population stands at nearly 304 million. As a result of that growth, mankind’s footprint on this world has in many ways begun to exceed the limits of the earth’s carrying capacity. We see the effects of these limits manifested in record high natural gas and heating oil prices, $200/barrel oil, $10/gallon gasoline, climate change, a persistent and prolonged state of financial crisis, the ongoing military conflicts in Iraq, Iran, and Afghanistan, and in the continuing food shortages and riots in both our country and around the world. But these issues, as serious and troubling as them may seem, are merely symptoms, not the root cause of the problems we face today.

When America’s space program provided us with the first photos of our planet from the perspective of space, we were awed not only by the beauty of our planet, but by it’s lonely isolation. One small planet providing an island oasis for humanity in an infinite universe. We can easily grasp the limitations of an island, but we have naively thought of the earth as an infinite source of life nurturing resources. The truth however, is that every planet like every island has a limited supply of natural resources and our planet is no different. As the world’s population and economy has grown, our natural resources have been systematically exhausted to the point were we can no longer depend on their increasing supply to fuel our economic growth and standards of living. Our undeniable reality is that we will have to accept and adjust to the limits imposed by the closed system we call Earth.

The challenge these natural limits will impose on our nation and the world will exceed any that we have faced either as a nation or as a community of nations. Our state of the world is that we have outgrown and exceeded the capacity of the earth to sustain the current level of population at current levels of consumption. Every other problem we face today is but a symptom of this one undeniable fact. Our choice is simple, we can either chase after symptoms and descend into a death spiral of conflict over dwindling resources, or we can use what remains of the earth’s resources to create a sustainable world for thousands of future generations. As a community of nations, we will have one chance and one chance only to accomplish this transition and the time is now. This is our moment to fail or succeed. If we fail to use what remains of our fossil fuel and other resources to successfully make this transition, the consequences will be dire and the world will return to a pre-industrial existence capable of sustaining only a fraction of the world’s existing population. Time is not on our side and we have only two, perhaps three decades to complete the task. It is incumbent upon this union, and the people of this nation to lead the world in this transition.

Our union began with a simple declaration penned by Thomas Jefferson.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness

Historically, as we pursued these simple Rights, we have much we can hold with pride and much we must hold with shame. As a country we have been both a shinning beacon of hope, opportunity, freedom, and prosperity; and we have also practiced slavery, committed genocide against our native populations, and covertly and overtly meddled in the affairs of other sovereign nations. We have won wars justly fought in the name of freedom and lost wars with murkier political and moral aims. Today we are no longer the the republic our founding fathers envisioned. We have become the most powerful nation in the history of the world….a virtual empire with over 800 foreign military posts and bases and a military budget exceeding the next 46 countries combined. If you add all of the money spent to maintain and support our worldwide empire by the DOD, the CIA, the Treasury, the FBI the State Department, Homeland Security, the Veterans Administration, and the interest we pay on past military expenditures, it amounts to well over $1-trillion per year and growing. This figure does even include the “supplemental” funds being spent on our current middle east conflicts. These expenditures are not sustainable, and the slow creeping growth of this overreaching empire has turned us into the world’s largest debtor nation and moved us far from the founding principles and ideals of our nation.

The economic success we experienced for the better part of the last century has given us the highest standard of consumption in the world, but by many measures, not the highest quality of life. For many of us, our pursuit of happiness has become a frantic, costly, and unsatisfying pursuit of the trivial and meaningless. In just a few decades we have managed to transform the strongest, most dynamic manufacturing economy in the world into a economy completely dependent on consumerism and debt. In a country with a negative savings rate, record high credit card debt, and declining home values, our consumer led economy is long past sustainable.

Yet it is from this point in our history that we must face our greatest challenge. If we continue to look at symptoms, our situation to many will seem hopeless and out of desperation and fear we will be tempted to blame others for our problems. Demagogues have and will call for pre-emptive military action against those that control what remains of the world’s rapidly depleting natural resources. But there can be no peace in the context of scarcity and no pursuit of happiness without peace. The root cause of our problems will not and cannot be solved by military action.

No other resource defines our current state than the world’s declining reserves of oil. Beginning with the discovery of oil in Pennsylvania in 1865, our country rapidly became the world’s first oil economy and this cheap and abundant energy resource would be the fuel and engine of growth that enabled us to become the world’s greatest economic power. However, U.S. production of oil peaked in 1971 and the petroleum power center quickly moved to middle east. Today it is painfully evident that oil production has peaked world wide and at current rates of consumption and depletion only half of what the world uses today will be available in just two decades. We will face similar “peaks” and painful declines in the production of coal, natural gas, and even uranium in the not so distant future.

Transitioning to a post fossil fuel world will not be easy. It will require sacrifice, high levels of cooperation, leadership, and the personal effort of every citizen of both this nation and of our community of nations. The last time our nation and much of the world was called upon to truly join together for a common cause was during WWII. That generation met it’s challenge and now it is our turn. The stakes have never been higher and the future of humanity literally hangs in the balance.

There will be some that say that “the market” will naturally adjust to the decline in fossil fuel resources and that all we have to do is stand back and trust in the magic of free markets. There is an element of truth is that view and one could point to recent growth in the renewable energy segment as proof of the validity of that position. However, like it or not, government is an integral part of the “market” and decades worth of federal and state laws, tax codes, and zoning and building regulations have been erected in direct or indirect support of our fossil fuel dependent economy. These laws, codes, and regulations will have to be rapidly deconstructed and rewritten to support a new sustainable, steady state economy fueled by renewable energy sources.

I have referenced population size several times in this address, and now I must return to this difficult and sensitive topic. The topics of human life and family size in this country have always been sacred, however as a nation and as a community of nations, we must face the very real limits of our planet to sustain life. The earth has a limited carrying capacity and can only support a reasonable standard of living for a given population size, and this capacity has already been exceeded. The world’s population can now only grow at the expense of our collective living standards and at the risk of increased and severe suffering. The only rational and humane course of action, is to limit and then reverse population growth in both the U.S. and the world.

The political, economic, and technical challenges we are facing are unprecedented and nothing we have faced in the past has prepared us for this moment. For the first time in human history we cannot meet these challenges and expect to succeed merely as individuals, or political parties, or as religious groups, or as nation states or as blocks of nations. To meet this challenge at this time, the entire world of nations must all join together in order to succeed or risk the catastrophic collapse of civilization.

Over the coming days I will be outlining a broad range of programs to meet this challenge. There will be no time for the usual political posturing or distractions, or for the interference of vested interests. Reason and events tell us that we all share the same vested interest and that our very survival is at stake. The american people will expect Congress to act boldly and decisively. The world will be watching.

First, to free up the required capital and additional engineering and R&D talent required to make the transition, I am proposing that we begin to aggressively reduce the expenditures of our military empire. A reduction in our current defense budget by 50% would still leave us spending as much as the next 5 countries combined. We can no longer afford to have our military robbing us of the nation’s industrial capital and technical talent. We must and will create a new manufacturing economy in America based on renewable energy and other sustainable technologies.

This new economy will be powered by electricity derived from solar and wind for our peak power demands, and most importantly by geothermal energy for our base load demand. In order to meet the challenge of making the transition to a post fossil fuel economy, I am proposing a government funded and fast tracked “Manhattan Project” to replace all of our coal fired power plants with geothermal energy by the year 2030.

Since we can only meet our future energy needs by addressing both the demand and supply sides of the equation, we must aggressively revise our tax codes to provide both credits and write-offs for a much broader array of energy conservation technologies and products. For example, we currently provide no incentives for solar hot water heating and rather than leading the world, as we must and should, the U.S. ranks behind both Solvenia and Albania in the the application of this technology.

The challenge of transforming our food supply may be one of our greatest. Food in U.S. travels an average of 1,500 miles from farm to table and we are dangerously dependent on oil and natural gas which supply the feedstocks for the pesticides, herbicides, and fertilizers on which our centralized and mechanized industrial food system depends. As evidenced by our growing food crisis, this system is rapidly becoming unsustainable and to help bridge the transition to a more localized food delivery system we will reinstitute the “victory garden” program of WWII and create millions of citizen farmers to secure our nations food supply.

Our residential, commercial, and industrial buildings consume 73% of our electricity and 20% of our natural gas. Easy and cheap energy has made building designer’s environmentally complacent and for the last 100 years we have relied on brute force heating and cooling solutions to prop up building designs totally inadequate for their environment. That practice must end and I am proposing that all new buildings in this country be designed to a zero energy standard and that tax incentives be put in place to help convert our existing building stock into some semblance of energy efficiency.

The pattern of our homes, cities, and transportation systems was created in a time of cheap and abundant fossil fuels. As oil and natural gas become increasingly scarce we will have to reshape our patterns and style of living. The new plug-in hybrids that are just appearing on the market will help to replace our use of liquid fuels for driving, but this new technology will soon cause us to exceed our electrical generation capacity. Our one car, one person pattern of commuting from isolated suburbs to work and shopping centers will have to be transformed. As a start, I am proposing that all knowledge workers be allowed the right to telecommute and to write off the the use of their home offices on their individual tax returns. We must also divert much of our unproductive defense budget and aggressively invest in light rail transportation systems and in our national rail system. In addition, our residential zoning laws will have to eased so that our pattern of suburban sprawl can naturally evolve new centers and nodes of commerce within walking and bicycling distance of our population.

However difficult, we must begin to face the limited carrying capacity of earth with regard to population. As a beginning, I am proposing that our tax codes be revised to support and reflect a stable and sustainable population, and that the tax credit for dependents be limited to one child. Out of fairness this new policy will not be retroactive nor apply to adopted children.

Lastly, we must change the way we keep score. One of the reasons we are in this mess is that classical economics assumes that natural resources like oil are infinite and makes no accounting of their depletion nor of the negative environmental effects of their use. We can no longer count the clean up of a super fund site as having the same positive impact to our gross national product as the building of a 747. To make matters worse, for decades our government has cooked the books to make things look considerably better than they appear. If we were held to the same accounting standards as our fortune 500 companies our annual deficits would actually be about ten times what is normally reported and we would have had to declare bankruptcy long ago. If we are to successfully transition to a sustainable way of life in the next 20 years then we must be able to accurately and reliably measure our progress and to that end I am proposing that we upgrade our national accounting practices to comply with a more realistic and accurate ecological economics standard.

The next two decades will be extremely disruptive and difficult and it is unlikely that any of us will emerge without great hardship and sacrifice. If there was ever a time for courage, for hard work, for faith, for strength of character, now is that time. I am counting on the people of this nation, on the people of the world, and on our community of nations to meet these challenges for the benefit of our children and grandchildren and for a thousand generations to come.

Thank you all and may God bless our nation and this planet.

This “address” is obviously a fiction and although much of what I say is factual even today, I doubt that any politician would have the courage the be this honest until things were well beyond the point of no return.

The market has begun to respond and it is not by accident that plug-in hybrids will begin to appear just as the general public is becoming aware of “peak oil”. The basic story line will run its course and we may just muddle through and make the transition in time to prevent a significant die-off of the world’s population. My guess is that it will be a messy transition with much political posturing, great suffering, and considerable military mischief.

Whether or not we do manage to muddle through, in the end, the world will no longer resemble the one we know today.

Water is a gift. Without water there would be no life as we know it. It is the vital life blood and circulation system of ecosystem earth. It comprises over 60% our bodies, and sustains all of the earth’s flora and fauna.

Water unites us. It knows no national boundaries. It covers two thirds of the globe. It rides the winds of our atmosphere and permeates the ground we walk on and the air we breath. In a very physical way, it declares that we are one, and the water molecule perspired from the Chinese coal miner’s body this week travels the world to become part of the Wall Street hedge fund manager’s body the next. It is a world traveler following unpredictable and unknowable patterns. One day giving the gift of gentle rain, and the next day giving the pain of prolonged droughts or sudden floods.

Water also divides us, or rather the lack of water divides us. Water scarcity turns friends into enemies as fear drives us to compete for its essential essence.

When the majority of americans were farmers and ranchers, water was not an abstraction. It’s worth was part of everyday consciousness, water wars were common, and it was rarely taken for granted. However, for today’s urban and sub-urban population, water is a given, never further away nor more inconvenient than the nearest faucet.

For most of us water “problems” are seen as a third world issue. However, third world water issues are not much different than the issues we confront in the U.S. The specific story line may differ, but not the central theme, and both the developed world and third world face the same hard limits. The world’s water is fixed and only about 2.5% of the world’s water is considered “fresh”. Of the fresh water, nearly 70% is locked away in glaciers, 30% in groundwater and a mere 0.3% can be found in the world’s lakes and river systems.

At the beginning of World War II resources of all kinds were diverted to support the war effort. Because only processed foods and dry grains could be reasonably transported to our troops and allies, canned foods and meats were heavily rationed. As the war began, America was in the middle of an agricultural revolution and productivity was increasing dramatically due to mechanization and the introduction of pesticides, herbicides, new hybrid crops, and synthetic fertilizers. However, the conversion of farmers into soldiers and the rationing of gasoline was putting a strain on both food supplies and our ability to transport fruits and vegetables to market.

A grass roots home gardening movement has begun to take hold, but Claude Wickard, the Secretary of Agriculture believed in a top down, industrial approach to food production and that home gardens would be an inadequate “feel good” attempt to feed the country and our war machine. However, one woman would change the course of the war and prove that massive amounts of food production could quickly and efficiently be de-centralized. Eleanor Roosevelt would plant a “victory garden” on the front lawn of the White House.

Under the not so subtle political pressure of this extraordinary woman, Secretary Wickard would relent and 20-million “victory” gardens planted and nurtured by 50 million inexperienced, first time citizen farmers would soon produce 9 to 10 million tons of fresh fruits and vegetables, providing nearly 50% of the nations needs. Pressure cooker sales would grow from 66,000 in 1942 to 315,000 in 1943 as a new nation of urban and suburban “food producers” would can their own fruits and vegetables. Ironically, the euphoria of the war’s end would cause us to abandon our victory gardens resulting in the worst food shortages of the era.

What does the example of Eleanor Roosevelt and the lesson of WWII victory gardens mean to us today? What hope does it provide in a time of bountiful choice and plentiful food?

The agriculture of today has reached the point of diminishing returns as brute force technology is no longer able to produce any meaningful increases in productivity. We have created a highly centralized food delivery system that has rendered us both obese and completely vulnerable to disruptions in the fossil fuel supplies that power our farm equipment and provide the feed stocks for our pesticides, herbicides, and fertilizer. On average our food travels 1500 miles from farm to table. We currently input 10 calories of fossil fuel energy for every one calorie of food energy we produce and as we pass over the peaks in both oil and natural gas production and slide down the slope of rapid depletion and diminished supply the disruption of our existing food delivery systems will be prolonged, painful, and severe. $100 per barrel oil, the loss of agricultural land to bio-fuels, and the rising costs of food are just the early warning signs.

Dismantling and transforming our centralized, monocultured, industrial agricultural complex will take considerable time and expose us to the very real potential of severe food shortages. However, hope lies in America’s 37 million suburban homes built in many cases on what used to be prime agricultural land. With a median lot size of 0.38 acres, we can bridge and soften the painful side effects of this inevitable transition by turning the ornamental landscape of suburbia into an edible permaculture of self reliance and community spirit. Much like the home generated PV and wind power that will democratize our national grid, home food production will democratize our food delivery system.

Imagine a new suburbia. Imagine backyard chicken coops, rabbit hutches, and fruit and vegetable gardens nurtured by tens of millions of part time, suburban farmers. A true and sustainable garden community of homes generating its own power and food.

Eleanor Roosevelt would be proud.

Fantasy Economics

I’m an architect and engineer by training, so when I began to write seriously about sustainability, I had no idea that the storyline would begin with a discussion of economic theory. Yet when one asks the question of what is sustainable or not sustainable relative to housing you are very quickly tossed into the stormy seas of “growth” and “limits”, and the conflict between neo-classical and ecological economics.

“Future generations are always free to make themselves miserable or content with whatever we give them. We do not owe the future their happiness, but we do owe them an intact resource base.”
Dr. Herman Daly

Home water heating in American represents a significant portion of our national energy consumption and is split about 50/50 between electric and natural gas. Electric water heating represents about 9.1% of residential electrical consumption, 23.7% of residential natural gas consumption and about 5% of total U.S. gas consumption.

Even with renewed and frenetic drilling, domestic production of natural gas in the lower 48 has plateaued and we now rely on Canada to supply nearly 20% of our needs.  However, Canada is nearing their own peak in natural gas production and as they reduce exports to meet Canadian demand, we are in race to delay the inevitable depletion and decline of our natural gas supply.  Our hopes now rest on building the Alaskan pipeline to tap into arctic reserves and building several more liquid natural gas [LNG] terminals to allow us to compete for Middle Eastern and Russia gas exports.  Whether either of these efforts will come in time to avoid near term shortages is unknown.  In any case, as a nation we will soon be in “supply hot water.”  Since we rely on natural gas to provide hot water indirectly via electricity from gas fired power plants and directly via gas water heaters, one way to help us out of the looming national gas shortage is with solar heated hot water.

Solar water heaters are one of the most commercialized renewable energy technologies in the world and yet on a per capita basis, U.S. implementation ranks 28th in the world behind relatively undeveloped countries like Albania and Slovenia.  China leads the world with an installed base equivalent to 52,500 megawatts of energy, more than 30 times the installed base of the U.S.,  and other developed countries like Germany, Japan, Switzerland, France, Austria, and Australia all rank far ahead of the U.S. in per capita solar hot water implementation.

Why does the U.S. lag so far behind the rest of world in solar hot water implementation?  The answers are many and include consumer concerns about ascetics and cost, a fragmented supplier base of relatively small companies, competing technologies that make make buying decisions confusing and difficult, and the resistance of vested interests.  Perhaps the biggest reason for the U.S. lag in implementation are national and state energy policies that are both incoherent and inconsistent.

Since president Nixon signed the Project Independence bill in 1974, followed by Carter’s signing of the Energy Security Act in 1980, there have been dozens of energy bills passed with the intent of leading us toward the goal of energy independence.  However, from 1974 to 2006 our oil imports have risen 191% from 1.27 billion barrels per year to 3.69 billion barrels and imports now amount to 65% of our total oil consumption.  In addition, we have gone from being self sufficient in natural gas production to importing 19.5%1 of our needs.  The 2005 Energy Bill was the latest attempt to cure our addiction to oil, but the bill was more a homage to “business as usual” and was packed with over $27 Billion dollars of subsidies to the oil, gas, coal, electrical generation, and nuclear industries.

The 2005 Energy Bill signed by President Bush includes over $6 Billion in Oil & Gas subsidies and $9 billion in coal subsidies, and $12 Billion in nuclear subsidies including:

• geological and geophysical costs associated with oil exploration can be written off faster than present law, costing taxpayers over $1.266 billion from 2007 to 2015.

• owners of oil refineries can now expense 50% of the costs of equipment used to increase a refinery’s capacity by at least 5%, this will cost taxpayers $842 million from 2006 to 2011

• natural gas companies will save $1.035 billion by being able to depreciate capital expenditures at a faster rate that currently allowed by law

• some royalty payments for drilling for natural gas in the Gulf of Mexico will be waived

• exempts the gas industry from the Safe Drinking Water Act for a coalbed methane gas drilling technique called “hydraulic fracturing,” a likely source of pollution in our underground acquifers

• increases the ability to exclude a broad range of oil and gas exploration and drilling activities from public involvement and impact analysis under the National Environmental Policy Actprovides $1.612 billion in tax credits to invest in new coal power plants,  $1.147 billion in tax breaks for owners of coal power plants to install pollution control equipment, and authorizes the appropriation of $4.8 billion of taxpayer money to help build a new fleet of coal power plants.

• provides a production tax credit of 1.8-cent for each kilowatt-hour of nuclear-generated electricity from new reactors during the first eight years of operation, costing $5.7 billion in revenue losses to the U.S. Treasury through 2025

In contrast the 2005 Energy Bill provides 30% tax credit for commercial and residential solar hot water or PV(photovoltaic) installations.  Unfortunately, for residential applications that credit is capped at $2,000 per homeowner and expires Dec 31, 2007.

Whether you consider the issues of climate change, looming natural gas shortages, or energy security, promoting solar water heating implementation in American homes should be a matter of national strategic importance.  Considered from the perspective of dwelling in a post fossil fuel world, solar hot water will soon become a critical alternative energy technology for every homeowner.

“In 1946, when the American post war housing boom started, the average house was 1100 square feet and housed 5 people. Fifty years latter, in 1996 the average house would grow to 2200 square feet and house 2.6 people and by 2007, fueled by easy credit, the average American home would would become the equivalent of a Hummer, “weighing in” at super-sized 2,400 square feet.”

In 1934, during the depths of the Depression, Congress passed the National Housing Act to strengthen a deeply troubled housing market. This act created the Federal Housing Administration (FHA) which was amended in 1938 to create the Federal National Mortgage Association (Ginnie Mae) – an entity designed to help mortgage lenders gain access to capital for mortgage loans. An important element of this legislation was to make mortgage funds available to more Americans by protecting lenders from the risk of default. In its earliest days, Fannie Mae nationalized the mortgage industry by creating the first mechanism in America for selling individual mortgages (backed the U.S. government) into a secondary market.

When the FHA and Fannie Mae were created, the housing industry was flat on its back:

• Two million construction workers had lost their jobs.
• Housing finance was a fragmented, inefficient and illiquid. Mortgage rates varied considerably from region to region. In some economically distressed regions there were simply no funds available.
• Terms were very difficult to meet for homebuyers seeking mortgages.
• Lending institutions would issue a mortgage, collect payments, and file the mortgage away until the principal was paid off. A lack of available, consistently priced capital put a hard ceiling on the number of new mortgages that could be issued.
• Mortgage loan terms were limited to 50 percent of the property’s market value. Borrower’s were faced with a 50% down payment and a repayment schedule spread over three to five years and ending with a large balloon payment.
• America was primarily a nation of renters. Only four in 10 households owned homes.
• Homes were NOT considered as investments and refi’s and equity withdrawals were extremely rare.

In the 1940’s after WWII, the FHA and the GI Bill helped finance millions of homes for returning veterans and their families. This post war period would mark the peak of American economic dominance. We were still the world’s major oil producer AND exporter and due to the devastation of the European manufacturing base, we dominated the world in virtually every industrial and manufacturing sector.

Fueled by cheap and abundant fossil fuel energy, this period would also mark the beginning of an American landscape built around the automobile and the “American (suburban) Dream”. These were “heady” times and the freedom of movement afforded by the automobile combined with affordable housing for millions of returning GI’s would prove seductive. We would build cars and homes as if the gasoline, natural gas, fuel oil, and electricity that made driving and comfortable home dwelling possible would be cheap and abundant forever. The big lumbering gas guzzling V8’s of the forties and fifties would be driven home to the energy guzzling, thinly insulated, drafty homes of a new suburbia. The cars would last about 5 five years. The homes however would last an average of 75 years.

In 1946, when the American post war housing boom started, the average house was 1100 square feet and housed 5 people. Fifty years latter, in 1996 the average house would grow to 2200 square feet and house 2.6 people and by 2007, fueled by easy credit, the average American home would would become the equivalent of a Hummer, “weighing in” at super-sized 2,400 square feet. The peaking of U.S. oil production in 1971, the formation of OPEC in 1973 and the associated energy crisis’ of the 1970’s would force much needed improvements in our building codes. However, today’s homes are still grossly under-insulated and 1/3 of their energy losses are still the result of air leaks through poorly constructed exterior walls! Our home energy standards are possibly worse than our car and truck CAFE standards (federal mileage requirements).  Look underneath the hood of our homes and you’ll 500 HP, super charged forced air furnaces lumbering away in our basements and holding the cold at bay with the brute force of natural gas and oil. We are still behaving as if cheap energy sources are forever.

Adding to the problem is the current culture of “homes as investments” and average ownership cycles of only 5 years. We are a culture with a myopic time horizon where granite countertops, super-sized floorplans, and home-equity financed SUV’s trump energy efficiency and solar hot water systems. This “housing bubble” culture may soon be going the way of the dinosaur with the fall of the sub-prime loan market, the collapse of Wall Street’s sleazy and toxic secondary market for home mortgages, and the first serious decline in home values since the great depression. However, the final death blow will come with the peaking of fossil fuel production, fuel shortages, blackouts, and the obvious and urgent need to transform our housing stock into some semblance of energy efficiency.

“It has often been said that, if the human species fails to make a go of it here on the Earth, some other species will take over the running. In the sense of developing intelligence this is not correct. We have or soon will have, exhausted the necessary physical prerequisites so far as this planet is concerned. With coal gone, oil gone, high-grade metallic ores gone, no species however competent can make the long climb from primitive conditions to high-level technology.
This is a one-shot affair. If we fail, this planetary system fails so far as intelligence is concerned. The same will be true of other planetary systems.On each of them there will be one chance, and one chance only.”
Sir Frederic Hoyle, British Astronomer, 1964

Hoyle’s “necessary physical prerequisites” are not yet gone, but the extraction of our most critical non-renewable energy resources will soon reach a geological milestone, and production will peak and then decline. This will set a two to three decade clock on our last and only chance to achieve a sustainable society.

• The consensus is that the production of oil has already peaked (2006) or will peak shortly and that serious shortages will occur by about 2010
• Natural gas production in N. America will peak between 2010 and 2015
• Uranium extraction will peak in 2025 and shortages are possible as early as 2013 when we can no longer depend on the recycling of Russian nuclear warheads to meet demand.
• Coal will peak around 2025 at about 30% above the present production

“…we don’t have to run out of oil to start having severe problems with industrial civilization and its dependent systems. We only have to slip over the all-time production peak and begin a slide down the arc of steady depletion.”
Howard Kunster ,The Long Emergency, 2005

We are left with the choice of only two future paths of development. The “business as usual” path will lead us to tragically overshoot the earth’s carrying capacity, resulting in economic collapse, and a dramatic reduction in the earth’s population as we return to a pre-industrial revolution standard of living. The second path represents Hoyle’s “last and only chance” to wisely use our remaining fossil fuel resources to build a sustainable and renewable energy foundation for a new steady-state world economy. An economy and society with a stable population that falls within the limits of our planet’s carrying capacity. I fear that the greater probability lies with the first path, but know we have both the knowledge and means to forge the second.

On the supply side, the second path requires that we rapidly replace our current extractive, non-renewable energy model with renewable sources like geothermal, solar, wind, and wave power. It will be a future dominated by electrical power as liquid fuels become increasingly scarce. However, it will not be enough to reach a stable, sustainable future without major changes to the demand side of the energy equation.

As we enter this period of sustained crisis and begin the journey down the path of ecological stability, it will quickly become evident that the only reasonable standard for building design will be a standard of net zero energy consumption. Because we lack information, initially this will be part science and part intuition based on passive heating and cooling lessons from the past. Eventually we will come to know the embodied energy of every building material and component and make many decisions based on the EROIE (energy return on investment of the energy embodied) of building products like insulation, low-e glazing, PV panels, and wind turbines. Houses will become smaller and change shape as energy trumps fashion and becomes the primary design factor. A whole new industry will emerge to help homeowners convert over 100-million thinly insulated, poorly constructed homes into some semblance of energy efficiency. Pattern’s of development and zoning laws will change as the age of the automobile comes to a close. Populations will shift and migrate as the end of cheap air-conditioning makes living in many parts of the country less desirable. Home landscaping will change from ornamental to edible, and grey water irrigation will become commonplace as the energy costs to move and purify water change our attitudes about this precious natural resource. Local materials will dominate construction and the age of imported italian granite countertops will come to an end.

The longer policy makers wait to take action the lower the probability of success. When shortages become evident we may still fall into denial. Demagogues and special interests will deny the limits of geology and blame OPEC, Islam, environmentalists, or speculators. If allowed, they will cloud the issue and cost us precious time.

Our “last chance” will be a battle. It will not be an easy time.