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1. Summarize an exemplary effort (IEA) to
set energy technology targets and
analyze the cost of achievement
2. Outline the governance issues related to
such an effort as well as financial
3. Propose an alternative or supplementary
• The study sets out a clear target: Reduce
world CO2 emissions in 2050 to 14GT
from 30GT (today) and from 62 GT
(business as usual projected for 2050)
• Most impressively, required increases in
energy RD &D are specified by technology
Expenditures And Gaps Table by
Internal Costs of IEA Wedges
• IEA wedges reductions are policy induced
and are likely to induce higher private
costs borne by industry and individuals
• A possible exception is end use energy
efficiency investment
– Consumers are thought to under invest
energy savings investments, so such policies
can reduce costs
– But even this will result in higher short run
• “No regrets” policies capture such benefits
Carbon Capture and Sequestration
• Not proven this technology can do as
projected, but critical to carbon reduction
– Capture and retention efficiency
– Storage availability
• Less CCS means switching “fuel” to
electric power less effective
• CCS cost starts with a 30% penalty with
increased parasitic load
Renewables and Energy
Efficiency Limits?
• Can very aggressive targets be met or will
solar and wind cost curves given evolution
of existing technology read a reach a limit
(i.e. do we need new renewable
• Policy is projected to reduce economy
wide energy intensity by twice the
historical rate sustained indefinitely
(Exceeds No Regrets cost gain?)
Summary of Essential Policy
• Impose CCS requirements for power and industrial coal
combustion or strongly incent them
• Impose aggressive energy efficiency requirements so as
to double the rate of decline in energy intensity
• Create aggressive incentives or requirements for
renewable energy sources
• Impose aggressive requirements for carbon free vehicles
• Require fuel switching to reduce carbon
• Each of these will increase short run costs and most
require increases in long run costs
• Each of these must be coordinated for at least the
largest economies
• Attainment requires a substantial increase in RD & D
An Alternative Goal: Reduce Costs
so as to Improve Human Welfare
• The last 200 years have witnessed a “miracle” of
economic growth which has made huge
contributions to human welfare
• Energy technology research and development
has been a prime driver by reducing the cost of
primary supply, and the cost of using energy
• Growth generating capital investment followed
the lead of potential lower cost energy
Can Fossil Fuels Offer Further
• Clearly oil and gas supply requires recovery of
more and more difficult resources
• Energy security costs attach to oil supply
• All fossil fuels, especially coal have substantial
external costs (non GHG)
– NOX, SOX, particulates, Hg
• Fossil fuel energy conversion technologies
reach thermodynamic limits constricting future
cost gains
A Lower Cost Future is Not Carbon
• Low cost nuclear
• Low cost renewables, perhaps not now on
the table
• Fusion
Can A Manhattan Style Project
Create or Accelerate Development
• Some key characteristics
– Theory formulated?
– Extremely difficult engineering issues
• Huge resources committed
– .4% of US GDP 1942-1945
– Today=$50 bil per year
• Low cost energy offers worldwide benefits
– Worldwide GDP equivalent: $240 bil
Organize Multiple Manhattan Projects
Senior scientists (i.e. Einstein’s and Szilard’s) and others as needed are
gathered to select technology areas to drive toward lower cost energy target
– First order of business: are there such technologies that want for
funding and focus?
– Technology areas identified
Zero to six government “Manhattan” Projects: China, EU, India, Japan,
Russia and the US are agreed to
Each government and its Academy of Sciences (or other as appropriate) is
given charge of organizing and funding one effort
Periodically (every 3 years?) scientists reconvene to assess progress and
“No regrets” implementation is part of the deal
Successful technologies are shared with an advantage to the developer
• Ultimately provides tangible benefits as perceived
directly by consumers around the world: focus on a first
best result
• Lower cost energy alternatives will tend to be market
implemented, no policy initiatives needed (except end
use efficiency as part of “No Regrets” which should also
improve welfare)
• Potentially addresses energy poverty
• Implementing agreements much simpler
– Less costly, less at stake
– Unified purpose: potential benefits for all
Science with a Mission
• Climate debate frames scientists as nags
– Tend to become policy advocates rather than
problem solvers
– Very little influence, no power, not political
– Hard case
• Science has an excellent record pursuing
difficult goals