The peak oil crisis: America's electricity
by Tom Whipple
Earlier this week, the National Conference of State Legislators held an energy policy forum entitled "The Future of State Electricity Policy" for the benefit of legislators from all over the U.S. who were attending the annual conference. At the outset, the organizers announced they had been considering a transportation fuels forum, but had finally deemed the subject too confusing and too politicized to grapple with at this time.
The first speaker, a senior Energy Information Administration (EIA) official, felt impelled, however, to tell the gathering that before talking about electricity, he should warn them that his agency is very concerned about the cost of home heating which is set to at least double this coming winter.
For the next eight hours, 12 speakers and hundreds of PowerPoints covered nearly every conceivable aspect of America's electric power situation - past, present and future. The good news is that, for the present, there is enough power to go around, so that unlike much of world, we should not have pervasive, continuing power shortages. It seems that 20 or 30 years ago, America's power industry overbuilt its generating capacity on the theory that America's homes, commercial spaces and industry would continue to grow robustly. They got the part about the residential and commercial space right, but failed to foresee that much of America's manufacturing capacity would depart for foreign lands. The result was that despite building larger houses, air-conditioning them to the hilt and stocking them with a myriad of power-guzzling electronic gizmos, we are still above water. If nothing else, our sagging economy and home sales should help out with somewhat lower demand for electricity in the immediate future.
From there on, however, the situation goes downhill. The overriding factor is carbon emissions, and there seems to be a consensus that the U.S. will pass some sort of Cap and Trade law soon that will force a reduction of carbon emissions into American air. For centuries, humans have been pumping increasing amounts of carbon into our global atmosphere, which can only hold a finite amount of such carbon. The use of the atmosphere as a place to dump our combustion waste has always been considered free and that, in turn, has kept the cost of energy from combusting fossil fuels much cheaper than it should be. The atmosphere, of course, is about to have its say, either by creating so much hell on earth that we are going to change our ways or, in the extreme case, simply shutting down many of us and much of our civilization.
Someday soon, we are going to start paying for using the atmosphere as a giant waste dump, and it is going to be expensive. Now we have the debate about what to do next. Obviously, any change on this scale will produce winners and losers, and they are already at each other's throats. The forum was treated to a running debate between a speaker who plans to build nuclear power plants up and down the East Coast, if the federal government will guarantee the loans, and an environmentalist legislator who thinks this a bad idea.
An underlying theme of the presentations is that increased efficiency and conservation is by far the cheapest way to keep having adequate electricity without harming the environment or coming to blows over nuclear generators versus carbon sequestration.
The presentations were full of interesting factoids. It was impressive that it now takes 90,000 BTUs a square foot to run the average building for a year, but this can be reduced to 40,000 or even 35,000 if the latest building technologies are applied. Improvements like this, of course, could take serious pressure off our demand for energy and might just let us get by with some semblance of life as we know it. The problem is our millions of buildings are owned by millions of people who don't see the declining capacity of the atmosphere to continue taking our waste carbon or the cost of energy as a problem - as yet.
It was interesting that if we put our wind generators on 300 ft. rather than 140 ft. towers, they just might make a lot more electricity in places we don't think have much wind. The government is building an extra-high generator in Colorado to test this out. There is still a ways to go, but all sorts of carbon-free power generation technologies - wind, waves, solar, geothermal, flowing water - are coming along nicely. Most think that as soon as we start charging consumers for dumping carbon into the atmosphere these will become economically competitive in a big hurry.
Another important aspect of our power situation is that we had better get busy rebuilding the national electric grid and making it smart. The current grid is decades old and is prone to expensive failures. In fact, there are already many small, unpublicized failures each year that are costing us billions in lost productivity. The bottom line of all this seems to be that capping the carbon, increasing the efficiency of power consumption and building a smart, robust, failure-resistant electric grid is the way to go. Someday soon, Congress will get this message.
The presentations were well-intentioned; however, lurking just outside the room was the 800-pound gorilla of peak oil. Although there was much discussion of increased fuel costs, particularly about natural gas for power generation and rapidly rising costs of building new infrastructures, there still seems to be little appreciation out there of what much higher liquid fuel costs and eventual shortages will do to our economy and to the feasibility of rebuilding our power generation, networks and buildings for a low emissions future.
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