Tag Archives: climate change

The Reality of Our Oil Demand

Another gem from Gregor Macdonald:

Here in United States we like to outsource the extraction of our oil supply to anyone but ourselves. We don’t particularly want to see the results of our own demand for liquid fuels, the pull from our 300 million vehicles and our four million miles of highways. We’d prefer that someone else–preferably far away–despoil their own landscape. And we’ve done quite a good job over the past several decades to make sure that’s happened, as the amount of oil we’ve had to import from the Mideast, from Africa, from Mexico and Canada has skyrocketed. This background is helpful in framing the BP well blowout in 5000 feet of Gulf deepwater. The reality of our oil demand has now touched home. In fact, it’s washing up on our coastline.


A Storyline of Global Collapse

In referring in my title here to “A Failed System” I do not of course mean that capitalism as a system is in any sense at an end. Rather I mean by “failed system” a global economic and social order that increasingly exhibits a fatal contradiction between reality and reason—to the point, in our time, where it threatens not only human welfare but also the continuation of most sentient forms of life on the planet. Three critical contradictions make up the contemporary world crisis emanating from capitalist development: (1) the current Great Financial Crisis and stagnation/depression; (2) the growing threat of planetary ecological collapse; and (3) the emergence of global imperial instability associated with shifting world hegemony and the struggle for resources

If you’re looking for the deep underlying narratives that can help bring clarity to the current unsettled state of our world, then this essay by John Foster is an excellent starting point.  Be forewarned that this is not an easy read and somewhat technical in it’s historical summary of economic theory, however if deeper understanding is your goal, reading this essay is well worth the effort.

The Obama Energy Plan and our Homes

How will Obama’s energy polices affect our homes?  We won’t really know until his proposals are debated and enacted by congress, but we can get a sense of what might happen from his campaign’s position statements.  From his campaign website’s fact sheet his stated position on building energy efficiency is as follows:

“Obama…will establish a goal of making all new buildings carbon neutral, or produce zero emissions, by 2030.  [He] will also establish a national goal of improving new building efficiency by 50 percent and existing building efficiency by 25 percent over the next decade to help us meet the 2030 goal.”

This is straight from the playbook of Ed Mazra’s Architecture 2030 Challenge.  As evidenced by the following quote from the 2030 website, the 2030 Challenge is predicated on climate change and the reduction of green house gas emissions associated with the Building Sector.

“Rapidly accelerating climate change (global warming), which is caused by greenhouse gas (GHG) emissions, is now fueling dangerous regional and global environmental events. Data from the U.S. Energy Information Administration illustrates that buildings are responsible for almost half (48%) of all GHG emissions annually. Seventy-six percent of all electricity generated by US power plants goes to supply the Building Sector. Therefore, immediate action in the Building Sector is essential if we are to avoid hazardous climate change.”

I have two issues with the 2030 Challenge.

One is that the 48% responsibility for GHG emissions attributed to buildings is overstated.  The emissions assigned to the building sector are primarily the indirect result of drawing on electrical power generated from coal and natural gas fired power plants, so the question becomes whether to focus our resources on the building “demand” side, or the power plant “supply” side, or some combination of both.  In that broader context, we may find that it is much easier to deal with a few hundred power plants than to transform 150 million residential and commerical buildings.  From a public policy perspective, both the demand and supply side should be considered as a synergistic whole.

My second issue is more fundamental.  Architecture 2030 asks and answers the wrong question.  The question that Architecture 2030 asks is what actions should we take to mitigate the effect of the building sector on climate change.  However, the greater question is what actions should we take to render the building sector sustainable.  Once sustainability is on the table then we have to consider carrying capacity and carrying capacity overshoot at which point climate change is just another canary in the coal mine.

Carrying capacity is all about the ecological limits (capacity) of our planet’s resources and sinks.  By considering GHG emissions as the primary driver for building energy improvements, policy makers are overlooking the much more immediate and serious resource issues of peak oil and gas.  Since both of these peak events will be evident as early as 2010, all buildings should be built or retrofitted to a net zero energy and carbon standard NOW, not 22 years from now.

However, I digress.  Since it will take the actual emergency of these peaking events to mobilize the political will to enact a national zero energy standard, the question is what can we expect when Obama takes office next year.

The first likely step will be to start the process of improving building efficiency by 50% through our building codes.  A significant improvement is already in the works for the residential sector with the IECC 2009. However, at this time, the 30% improvement authored by the Energy Efficient Codes Coalition, will only be a voluntary appendix to the next release of the code.  In addition, once the new code is released, it has to be reviewed and adopted by hundreds of city, county, and state authorities.  In the process, these authorities often dumb down new energy code provisions in response to local politics.  We can also expect a major push back from a decimated housing sector deeply concerned about adding any new code mandated building costs.

My best guess is that under Obama, the voluntary 30% improvement provision authored by Energy Efficient Codes Coalition will be supported by Obama’s Grant Program for Early Adopters policy proposal.  This proposal creates a competitive grant program for states and localities that “take the first steps in implementing new building codes that prioritize energy efficiency, and provides a federal match for those states with leading-edge public benefits funds that support energy efficiency retrofits of existing buildings.”

The grant proposal creates a policy that respects local politics and helps to support those areas of country that have the political will to move forward with improving building energy efficiency.

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Electrial Cooperatives and Distributed Power Generation

“Solar [PV] is slowly going to begin to unwind the existing utility economics, to the point where utilities decide they have to get in or they risk losing their core business – exactly [like] the [PC and telcom] transformations we’ve lived through in the last 20 years.”
Travis Bradford, 2008, author of Solar Revolution

For nearly 100 years utility companies have operated with minimal competition as a regulated monopoly. Imagine having a business that nearly always grew and when costs increased, you could just pass them off to your customers in the form of higher prices.  Utilities, much like the long distance telephone carriers of our recent past, are now facing real competition for the first time.  The primary threat is from PV power installed on the rooftops of American homes and unlike revenue losing energy efficiency measures, such as compact fluorescent lighting, efficient heating and cooling equipment, solar hot water systems, and Energy Star appliances, SOME utilities see homeowner PV and wind power generation as a threat to future revenue loss they can block.

The electrical generation and distribution market in America is divided between Investor Owned Utilities (IOU), Public Owned (Federal or city), and Cooperatives formed under the 1936 Rural Electrification Act.

Investor owned utilities have been the first to adopt net metering due to state laws mandating both net metering and minimum requirements for producing power via renewable energy.  Also, because PV power is generated during the hours of peak demand, providing incentives for residential PV makes good business sense because it offsets the higher operating costs of natural gas peak power plants and defers or avoids the capital costs of additional plants.  However, public utilities and cooperatives are typically not subject to these laws, and aside from the preferential Federal hydroelectric power they get on the cheap, cooperatives in particular have resisted pressure to promote and use renewables.

Cooperatives and the Rural Electrification Administration (REA) launched by President Franklin D. Roosevelt in 1935 are one this country’s greatest success stories.  At the time private and investor owned utilities were not willing to take the risk to extend electrical service to rural areas and millions of  american communities, farms, and ranches were without any source of electricity.

The first rural cooperative organizations were humble main street store-fronts and by 1938 the typical coop had about 800 consumer-members with democratically elected directors to manage the affairs of the organization. These early coops were “first name” neighborly affairs and about as formal as your local grange.  A typical “staff” might consist of a manager, a bookkeeper, a line foreman and a single crew.  Growth would be revolutionary, and by the 1940’s REA cooperatives would deliver power to over 97% of America’s farms and ranches and cooperatives would politically band together under the National Rural Electric Cooperative Association.  As the country grew, the demographics of many cooperatives would change from rural to suburban and the original small farm, grassroots, community character would begin to take on a more corporate feel.  In 1987 and 1993, first president Reagan and then President Clinton would attempt to dismantle the REA structure of federal subsidies, but the cooperative “political footprint” had grown too large and powerful.  Today cooperatives are largely resellers of electricity they buy from investor owned and public utilities at wholesale and resell to their members at retail.  Many are “cooperatives” in name and form only and behave and act with the same self interest as any corporation.  Since, in many cases they are neither base or peak power generators, they don’t have the same incentive as the investor owned utilities to manage peak demand and promote and financially support homeowner PV or wind power systems.

The battle for grid access with cooperatives can best be illustrated with a personal example.

I live in geographical middle of Colorado within the service area of the Intermountain Rural Electrical Association (IREA).  The IREA was formed in 1938 and is the largest of 22 Colorado cooperatives serving a population that is both rural and Denver suburban.  The IREA buys it 93% of its power from investor owned utility XCEL and the balance from DOE’s Western Area Power Administration, a federal hydroelectric power provider.  The members of IREA elect board directors in various districts within the IREA service area every four years.  This sounds democratic enough, but unlike the rural members of the 1930’s who helped dig and plant the original power poles, todays members see themselves more as customers and director elections get about as much mind-share as an election for county coroner.  As a result, directors tend to be elected for “life”, getting what amounts to a proxy rubber stamp every four years.  This cozy relationship changed in 2007 when a member revolt in some of the more liberal suburban districts mobilized to elect a director with greener credentials. The trigger for the revolt was IREA’s position on global warming.  IREA’s website devotes an entire page to debunking global warming and they had spent $100,000 that year to fund anti-global warming “research”.  You have to wonder why a relatively small electrical power reseller would spend so much of its members money tilting a political windmills.

The IREA belongs to both the National Rural Electric Cooperative Association and the Colorado Rural Electric Association(CREA).  These lobbying organizations represent large and conservative political footprints at both the state and national levels.  The Colorado state legislature has been at battle with the CREA over a proposed net metering law for cooperatives.  The CREA and IREA’s position is that residential and other customer’s that take advantage of net metering by installing PV or other renewable power technologies do not pay their fair share of indirect costs and that net metering should be limited to a small percentage of customer’s and that excess power generated should only be reimbursed at “wholesale” rates.  This argument is weak at best, and I could apply the identical logic to a customer that weatherizes his home, or installs Energy Star appliances or compact fluorescent lights.  Add to that the irony that over 90% of the electricity I receive from the IREA comes from XCEL energy which has an aggressive Solar Rewards program to encourage net metered generation of PV power.  To promote the program, XCEL has invested $19.5 million in rebates to over 1,000 customers adding more than 4.3 megawatts of solar energy capacity, and plans on adding another 29 megawatts of capacity by 2015.

The Rural Electrification Administration was renamed the Rural Utilities Service (RUS) in 1994 and continues to subsidize cooperatives through low-rate government loans.  The Washington Post recently reported that the RUS “is using taxpayer money to provide billions of dollars in low-interest loans to build coal plants even as Congress seeks ways to limit greenhouse gas emissions.”  Since only 24% of the counties served by cooperatives are completely rural and 200 of the counties served have populations of more than 1 million, the RUS has lost its original rural focus and now subsidizes many urban areas.  Cooperatives are a “New Deal” legacy program that fulfilled its basic function decades ago and now has taken on a life of its own.  It is ironic that the progressive policies that created the electrical cooperatives and brought power to rural American in the 1930’s and 40’s, would evolve into a regressive and entrenched bureaucracy that will probably be the last barrier to a national  policy of net metering and the distributed generation revolution.

Note: The electrical cooperatives eventually lost the net metering battle in Colorado and must now reimburse net metered customers at retail rates.

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A Ponzi Scheme Wrapped in a Three Piece Suit of Respectability

“Once you sit down and draw a little picture of the economy as a subset of the larger ecosystem, then you’re halfway home as far as ecological economics is concerned. That’s why people resist doing that. That means you would have to say well, there are limits, we’re not going to be able to grow forever. That means the economy must have some optimal scale relative to the larger system. That means you don’t grow beyond the optimum.
How do we stop growing? What do we do?
These are very threatening questions.”
Dr. Herman Daly, Former World Bank economist and author of Ecological Economics

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.

When it comes to our mainstream economic theory, it seems that we are not much removed from our ancestors who thought the earth was flat or at the center of the universe. The neo-classical economics currently taught in all of our major universities dominates both our world view and governmental policy making. Developed in a time of abundant natural resources, it assumes that non-renewable natural resources are infinite and ignores the environmental costs of their production and consumption. It is an economic theory that worships at the church of growth and blindly disregards it’s own existence within a closed ecosystem. Much like the 16th century catholic church that believed that the earth was the center of the universe, neo-classical economics believes it is the tail that wags the ecosystem. Herman Daly, the father of ecological economics, likens the current situation to a chain-letter swindle or ponzi scheme in which “The current beneficiaries of the swindle, those at the beginning of the chain, try hard to keep up the illusion among those doubters at the end who are beginning to wonder if there are really sufficient resources in the world for the game to continue very much longer.” This ponzi scheme would eventually play itself out in the U.S. housing sector in the form of energy guzzling McMansions, and mind numbing suburban sprawl.
The American Church of Growth
The concept of growth in America would be enshrined in our national psyche when Thomas Jefferson penned the words “life, liberty, and the pursuit of happiness” into our declaration of independence. As the country migrated west, growth and development would take on a patina of virtue and goodness and become the religion of the land. Our pursuit of happiness would not always be as pure as the words of Jefferson, and our migration west would be equal parts courage, individual initiative, greed, and genocide. As we moved west we would both take and rape, arrogantly taking land from the native population and casually raping the environment of it’s natural resources.
The discovery of oil and the invention of the automobile would eventually morph our cities and towns into massive developments comprised of weak centers surrounded by a web of suburban wasteland anchored by multi-lane highways as each generation tapped into our balance sheet of natural resources in a mad pursuit of growth and prosperity. The happiness we sought in the rapid growth and development of our built environment would not be defined by Jefferson’s liberty, but by long commutes, road rage, pathological consumption, crushing debt, an epidemic of obesity and national dependancy on anti-depressants.
The impact of neo-classical economics on housing would and continues to be profound and pervasive. This ponzi scheme wrapped in a three piece suit of respectability would provide the hidden intellectual foundation for growing home sizes, suburban sprawl, and countless “cost benefit” studies that would shape the regulations that formed the basis of our inadequate energy codes. However we are now approaching an ecological tipping point and the current generation will find themselves the recipient of the scheme’s inevitable collapse.
Ecosystems self-correct with Unbiased Indifference
Ecosystems are naturally self-correcting and treat all populations that overreach with equal and unbiased indifference. It matters not whether the population is human, animal, plant, insect or microbe, any population that exceeds its natural carrying capacity is either forced to reduce its numbers or its level of consumption. The 2002 Limits to Growth report estimates that human “growth and development” has already exceeded the earth’s carrying capacity by more than 20% and it is evident that the earth’s ecosystem has already begun the process of adjustment and rebalancing. The economic theory and policy decisions that brought us to our current state will be quietly trumped by the natural processes that we have ignored.
The signs and warnings of this natural rebalancing are everywhere. Climate change, rapid species extinction, fisheries collapse, depleted aquifers, loss of arable land, $100/barrel oil, and monthly heating costs that equal mortgage payments are all evidence of natural limits in action. As the world’s largest per-capita consumer of natural resources, the U.S. has become the poster nation for ecological overreach and collapse. As a result we currently face an especially painful and traumatic transition to a more sustainable future.
“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

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