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Mother Pelican
A Journal of Solidarity and Sustainability

Vol. 8, No. 4, April 2012
Luis T. Gutiérrez, Editor
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Short-Term Strategies for Sustainable Energy

SUMMARY & OUTLINE

This new page is work in progress. The plan is to build a "one page synthesis" on short-term tactics and strategies for the transition to clean energy.

1. Global Citizen Movements & The Occupy Movement
2. Education for Sustainable Development
3. Net Energy and Energy Return on Investment (EROI)
4. Financial Transaction/Speculation Taxes
5. Shift to Land/Resource Value Taxes
6. Guaranteed Basic Personal Income
7. ISO Standards, Guidelines, and Best Practices
8. Transferring Subsidies from Fossil Fuels to Clean Energy
9. Fostering and Deploying Clean Energy Technologies
STATEMENT BY THE U.N. SECRETARY GENERAL

"For most of the last century, economic growth was fuelled by what seemed to be a certain truth: the abundance of natural resources. We mined our way to growth. We burned our way to prosperity. We believed in consumption without consequences. Those days are gone. In the twenty-first century, supplies are running short and the global thermostat is running high. Climate change is also showing us that the old model is more than obsolete. It has rendered it extremely dangerous. Over time, that model is a recipe for national disaster. It is a global suicide pact." UN Secretary-General Ban Ki-moon’s remarks to the World Economic Forum session on redefining sustainable development, Davos, Switzerland, 28 January 2011. For the complete text, click here.

ANALYSIS & SYNTHESIS OF SHORT-TERM STRATEGIES

Methods for analysis of short-term strategies include precedence diagrams, interdependency matrices, and optimization techniques such as linear programming. Software is readily available to do the number crunching.

The following are recent contributions to short-term improvement of energy systems:

Industrial Energy System Optimization, UNIDO web site as of 26 february 2012.
Energy Management Standards, UNIDO web site as of 26 february 2012.
Management System for Energy (ISO 50000), UNIDO web site as of 26 february 2012.
Stability criteria for complex ecosystems, Stefano Allesina & Si Tang, Nature, 19 February 2012.
Considering the energy, water and food nexus: Towards an integrated modelling approach, Morgan Bazilian et al., Energy Policy, 21 October 2011.
Reinventing Fire: Blueprint to the new energy era, Rocky Mountain Institute, 15 October 2011.
Simulation of Energy Transitions, Emile Chappin, Delft University, 16 June 2011.

1. Global Citizen Movements & The Occupy Movement

"The term Global Citizens Movement (GCM) refers to a profound shift in values among an aware and engaged citizenry. Transnational corporations, governments, and non-governmental organizations (NGOs) remain powerful actors, but all of these are deeply influenced by a coherent, worldwide association of millions of people who call for priority to be placed on new vales of quality of life, human solidarity, and environmental sustainability. It is important to note that the GCM is a socio-political process rather than a political organization or party structure." Global Citizens Movement (GCM), Encyclopedia of Earth, November 2007.

KEY LINKS:

How to Turn the Power of the Wall Street Protests into Real Reforms
by Brent Blackwelder, Daly News, 24 October 2011

As the Wall Street protests have spread from New York City to the rest of the country, some media pundits have criticized the protesters for being unfocused — as if there were only one thing wrong with the financial sector of the U.S. economy. The protests have provided a welcome response to Wall Street’s massive takeover of governance, and continued opposition to the status quo could produce opportunities to enact real reforms.

Don’t expect Wall Street to undertake such reforms voluntarily — some of the shady practices are too profitable. It’s going to take new laws, and key legislation is pending in Congress that could provide important remedies. But new legislation won’t pass without the strongest pressure. That’s where the protesters could make a difference, especially with some forceful activity in the districts where the obstructionists, like House Majority Leader Eric Cantor from Virginia, reside. Cantor said to the conservative Values Voter conference: “I, for one, am increasingly concerned about the growing mobs occupying Wall Street” but he backtracked a week later when cautioned by his political finger-in-the-wind testers about the growing popularity of the protests.

Among all the morally bankrupt practices on Wall Street, there’s one in particular that would be easy to abolish. Easy, that is, if we can translate some the energy of the protests into pressure on lawmakers. Pending in Congress are powerful bills such as Senator Levin’s S. 1346 (Stop Tax Haven Abuse Act of 2011) that would strike hard at tax dodgers. But a bill like that has no prayer of passage unless representatives like Cantor feel the pressure.

Instead of reform, Congress is in fact poised to give another “one-time only” tax holiday to companies that stashed profits in tax havens. Huge and wealthy U.S. corporations are actively seeking what is known as a “repatriation holiday” because they say it would create jobs. Such a holiday would allow them to bring home offshore profits at a reduced rate — a nice holiday for the well-to-do CEOs and shareholders, while the rest of us taxpayers suffer the consequences of losing $80 billion of revenue.

The Tax Justice Network and a number of small business associations are trying to right this wrong. They have sent a letter to Congress to dispute this repatriation holiday, noting: “Too many corporations have turned their tax departments into profit centers, using aggressive accounting manipulation to disguise U.S. profits as foreign profits.”

Bloomberg Business Week has pointed out prime examples: Google reduced its income taxes by about $3.1 billion over three years — first by shifting income to Ireland, then to the Netherlands, and finally to Bermuda. Another example is Forest Laboratories, a company that sells over 99% of its drugs in the U.S. but attributes the bulk of its profits to a law office in Bermuda.

Corporate abuses are all the more frustrating in light of how the Congressional “Supercommittee” is discussing the deficit. The Supercommittee is poised to recommend draconian cuts in important programs, but its Republican members are unwilling to address tax havens and tax dodgers that cost the U.S. Treasury an estimated $100 billion per year. The two biggest banks benefiting from taxpayer bailouts are Citigroup with 427 subsidiaries in tax havens and Bank of America with 115.

A recent report by the Institute for Policy Studies (IPS) adds more grist to the protesters’ mill. The report notes that the salary of chief executives (CEOs) of the S&P 500 soared 27.8% in 2010 to $10.8 million, making the ratio between average CEO pay and average U.S. worker pay now 325 to 1. Back in the good old days of 2009, the ratio was much more equitable at “only” 263 to 1. The IPS study found that 25 of the top 100 CEOs received more pay than their companies paid in federal income tax. Furthermore, 20 of these 25 companies spent more on lobbying than they paid in federal income tax.

One more recent analysis, published in the journal of the Association for Psychological Science, provides new support for those advocating major reforms in the tax code. The analysis found that those countries with the most progressive tax codes (those that are the exact opposite of a flat tax where everyone regardless of income pays the same rate) had the highest happiness ratings.

Americans want a sustainable and fair economy. But we won’t get one without fundamental financial reforms and a clamp-down on tax dodgers. And we won’t get that without applying pressure to lawmakers and corporations. Now that’s a good focus for a protest.

CASSE Web Materials by CASSE are licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License

A high priority of global citizenship is education, either informally through personal contacts and public means of communication such as the internet, or more formally via programs sponsored by educational institutions. At a time when both developed and developing nations seem to be engulfed in political and financial corruption, education in noviolence is especially important. If a global revolution is coming, let it be a nonviolent revolution!

If a global revolution is coming, let it be a nonviolent revolution!


2. Education for Sustainable Development

Education for Sustainable Development (ESD) worldwide - at all levels - is a high priority. UNESCO has a worldwide program, but universities and other educational institutions must contribute. The family is the best school of sustainable human development.

KEY LINKS:

RECENT:

ESD best practices should include practical (and field tested) means to advance public policy for sustainable development. It is hoped that ESD will overcome the ambiguity of the term "sustainable development" to make it clear that infinite growth in a finite planet is a practical impossibility in the long-term. What really matters going forward is "sustainable human development."


3. Net Energy and Energy Return on Investment (EROI)

DEFINITIONS

At each point in the energy supply chain:

NET ENERGY = ENERGY GAINED - ENERGY SPENT
(in energy units, eg., MegaJoules)

ENERGY RETURN ON INVESTMENT = ENERGY GAINED / ENERGY SPENT
(dimensionless ratio)

Thus, Net Energy and Energy Return on Investment (EROI) -- or Energy Return on Energy Invested (EROEI) -- are conceptually the same measure. Generally, EROI is closely correlated with "financial return on financial energy investment" -- a measure of financial return in dollars -- as long as "constant [year] dollars" are used.

ENERGY RETURN ON ENERGY INVESTED (EROEI, also abbreviated as EROI)

"Energy Return on Investment (EROI) refers to how much energy is returned from one unit of energy invested in an energy-producing activity. It is a critical parameter for understanding and ranking different fuels. There were a number of studies on EROI three decades ago but relatively little work since. Now there is a whole new interest in EROI as fuels get increasingly expensive and as we attempt to weigh alternative energies against traditional ones. This special volume brings together a whole series of high quality new studies on EROI, as well as many papers that struggle with the meaning of changing EROI and its impact on our economy. One overall conclusion is that the quality of fuels is at least as important in our assessment as is the quantity. I argue that many of the contemporary changes in our economy are related directly to changing EROI as our premium fuels are increasingly depleted." Charles Hall, Introduction to Special Issue on New Studies in EROI (Energy Return on Investment), Sustainability, Volume 3, Issue 10, 7 October 2011.

COMPARATIVE ANALYSIS OF ENERGY RESOURCES

As the time window of opportunity may be shorter than expected, it is imperative to work out short-term energy strategies in conjunction with long-term strategies. A 2009 study by Richard Heinberg and the Post-Carbon Institute includes a comparative analysis of 18 energy sources according to 10 criteria, as follows:

Searching for a Miracle: ‘Net Energy’ Limits & the Fate of Industrial Society
Richard Heinberg, Post Carbon Institute, September 2011

Energy Sources

1) Oil
2) Coal
3) Natural gas
4) Hydropower
5) Nuclear
6) Biomass
7) Wind Power
8) Solar Photovoltaics
9) Active Solar Thermal
10) Passive Solar
11) Geothermal Energy
12) Energy from Waste
13) Ethanol
14) Biodiesel
15) Tar Sands
16) Oil Shale
17) Tidal Power
18)Wave Energy

Criteria for comparative analysis:

1) Direct Monetary Cost
2) Dependence on Additional Resources
3) Environmental Impacts
4) Renewability
5) Potential Size or Scale of Contribution
6) Location of the Resource
7) Reliability
8) Energy Density
9) Transportability
10)"Net Energy" or "Energy Returned on Energy Invested" (EROEI)

The tenth criterion, "Net Energy" or "Energy Returned on Energy Invested" (EROEI), is critical: "This measure focuses on the key question: All things considered, how much more energy does a system produce than is required to develop and operate that system? What is the ratio of energy in versus energy out? Some energy “sources” can be shown to produce little or no net energy. Others are only minimally positive."

A summary of the results is as follows:

ComparisonFuelSources-Heinberg2009.jpg
Comparison of Fuel Sources, Post-Carbon Institute, 2009

Conclusions:

"The present analysis, which takes into account EROEI and other limits to available energy sources, suggests first that the transition is inevitable and necessary (as fossil fuels are rapidly depleting and are also characterized by rapidly declining EROEI), and that the transition will be neither easy nor cheap. Further, it is reasonable to conclude from what we have seen that a full replacement of energy currently derived from fossil fuels with energy from alternative sources is probably impossible over the short term; it may be unrealistic to expect it even over longer time frames.

"The core problem, which is daunting, is this: How can we successfully replace a concentrated store of solar energy (i.e., fossil fuels, which were formed from plants that long ago bio-chemically captured and stored the energy of sunlight) with a flux of solar energy (in any of the various forms in which it is available, including sunlight, wind, biomass, and flowing water)? ...

"Based on all that we have discussed, the clear conclusion is that the world will almost certainly have considerably less energy available to use in the future, not more, though (regrettably) this strong likelihood is not yet reflected in projections from the International Energy Agency or any other notable official source. Fossil fuel supplies will almost surely decline faster than alternatives can be developed to replace them. New sources of energy will in many cases have lower net energy profiles than conventional fossil fuels have historically had, and they will require expensive new infrastructure to overcome problems of intermittency...

"How far will supplies fall, and how fast? Taking into account depletion-led declines in oil and natural gas production, a leveling off of energy from coal, and the recent shrinkage of investment in the energy sector, it may be reasonable to expect a reduction in global energy availability of 20 percent or more during the next quarter century. Factoring in expected population growth, this implies substantial per-capita reductions in available energy. These declines are unlikely to be evenly distributed among nations, with oil and gas importers being hardest hit, and with the poorest countries seeing energy consumption returning to pre-industrial levels (with energy coming almost entirely from food crops and forests and work being done almost entirely by muscle power).

"Thus, the question the world faces is no longer whether to reduce energy consumption, but how. Policy makers could choose to manage energy unintelligently (maintaining fossil fuel dependency as long as possible while making poor choices of alternatives, such as biofuels or tar sands, and insufficient investments in the far more promising options such as wind and solar). In the latter case, results will be catastrophic. Transport systems will wither (especially ones relying on the most energy intensive vehicles—such as airplanes, automobiles, and trucks). Global trade will contract dramatically, as shipping becomes more costly. And energy dependent food systems will falter, as chemical input and transport costs soar. All of this could in turn lead to very high long-term unemployment and perhaps even famine.

"However, if policy makers manage the energy downturn intelligently, an acceptable quality of life could be maintained in both industrialized and less-industrialized nations at a more equitable level than today; at the same time, greenhouse gas emissions could be reduced dramatically. This would require a significant public campaign toward the establishment of a new broadly accepted conservation ethic to replace current emphases on neverending growth and over-consumption at both personal and institutional-corporate levels."

These conclusions are confirmed by many independent analyses done as far back as the 1970s and as recent as January 2012. The data is noisy, but the signal is always strong and always the same: barring a technological miracle (or an "act of God") it does not appear possible to replace fossil fuels with any or all of the renewable ("clean") sources and maintain the same rate of energy flow through an industrial economy. This brings to mind the applicability of the precautionary principle to the energy availability situation worldwide.

EROI TRADEOFF ANALYSIS FOR TRANSITION PLANNING

With proper funding, it might be possible to use biophysical input-output analysis to explore energy policy tradeoffs going forward. For a given year, let

X = n-dimensional total production vector ($)
U = n-dimensional final demand vector ($)
A = NxN matrix of direct inputs (i.e., aij = input from industry i to industry j)

Note that the n industries include the energy extraction, production, and delivery sectors, as well as the pollution abatement and environmental remediation sectors. The basic Leontief equation for total required production is

X = AX + U
X - AX = U
(I-A) X = U
X = (I-A)-1U

Let, for a given energy resource r,

Y = n-dimensional industry energy input vector (i.e., production energy intensity vector, y=1,...,n, in joules/dollar), and

Z = n-dimensional public consumption output vector (i.e., consumption energy intensity vector, z=1,...,n, in joules/dollar)

Then, for the total economy,

Ey = X . Y
is the total amount of energy resource r (in $ . joules/$ = joules) required by the economy during the year, taking into account both direct and indirect inter-industry energy flow requirements; and
Ez = U . Z
is the total amount of energy resource r (in $ . joules/$ = joules) used by consumers of all products during the year.

One problem with input-output analysis in economics is that the interindustry coefficients are in dollars of input from industry i to dollars of output by industry j. Given the volatility of monetary issues (inflation, deflation, politics, etc.), data in dollars are always problematic. From the perspective of biophysical economics, it would be preferable to use coefficients in physical units, i.e., the ratio of units of industry i input to units of industry j output. This would allow for analysis of technological tradeoffs with much of the "noise" filtered out. Dollar conversions can then be applied to translate EROI results (in biophysical units) to financial return on investment in dollars. While input-out models provide a static "snapshot" model of the economy at a given point in time, the biophysical coefficients could be formulated as functions of time in order to take into account the time required for technological changes to be implemented.

Given the technological complexities and social risks of a transition from a high-EROI to a low-EROI economy (as painfully experienced, for example, in Cuba during the early 1990s and North Korea during the early 2000s, both due to unanticipated oil shortages) it is arguably reasonable to spend significant effort (and dollars) in developing better analytical tools to ease the pain.

OTHER ANALYTICAL METHODS FOR ENERGY POLICY ASSESSMENT

The input-output method of analysis is static, i.e., it is based on a "snapshot" of the economy at a given point in time. It is most useful when detailed (and short-term) comparative evaluation of specific energy sources and technologies are required -- oil versus coal, oil versus wind, oil versus solar, etc. Even in such cases, the data refinement effort pursuant to make the interindustry coefficients time-dependent may or may not be possible.

A broader analysis may be required in order to include long-term dynamic interactions between social, economic, and environmental variables in conjunction with plausible energy transition scenarios. Then analysis at a higher level of aggregation might be indicated, and it may be more expedient to use simulation models such as Limits to Growth -- with "resources" more specifically reformulated as "energy resources" -- to examine the repercussions of the transition from high-EROI to low-EROI economies and lifestyles. There is a need for "Revisiting the Limits to Growth After Peak Oil." This is the kind of analysis that will be attempted with SDSIM 2.0.

The social-economic-ecological system is too complex for any single method of analysis, or any combination of existing methods. The best practice is to start with the policy questions or issues to be addressed and use the method(s) that would yield the best insights for consideration by citizens and policy makers. In this regard, the recently emerging method of behavioral economics is promising and may be useful to capture changing patterns of human decision-making during the transition from high-EROI to low-EROI societies.

Another good practice is to recognize that modelers are scientists, not policy makers or problem solvers. Modelers are scientists using models and simulation experiments to test a hypothesis under "controlled" conditiones that may or may not to amenable to replication in the real world. There must be constant dialogue between scientists and decision-makers. But conflating science and decision-making generally exacerbates confusion and seldom leads to practical solutions.

RECENT RESEARCH



4. Financial Transaction/Speculation Taxes

Financial transaction/speculation taxes are a disincentive to excessive greed in pursuing financial transactions of dubious social value, such as the so-called "financial derivatives."

KEY LINKS:

The following section is about reforming tax codes so as to protect the integrity of the human habitat. The following is a excerpt from one many recent reports calling for taxing financial transactions to support the transition to clean energy:

Reclaiming Power: An energy model for people and the planet, Friends of the Earth,
2 December 2011.

"New research by Friends of the Earth presents an alternative energy model that would tackle climate change and enable everyone to gain access to energy.

"Our current energy model is not working:

  • Our dependency on fossil fuels is driving dangerous climate change
  • Our traditional energy model fails to serve 40 per cent of the world's population adequately
  • 1 billion of those without electricity will never be reached by expanding national grids

"The alternative:

"Friends of the Earth proposes an energy model based on a system of global feed in tariffs whcih guarantee cash back for local renewable energy generation. This model would help to:

  • Tackle climate change by shifting energy away from polluting fossil fuels
  • Deliver low-carbon, decentralised energy
  • Address poverty and development through universal access to clean, reliable, affordable energy
  • Rapidly lower the cost of renewable energy technology, making a low-carbon transition easier and cheaper worldwide

"This mechanism should be publicly funded by rich countries who have committed to help developing countries adapt to climate change

"Sources of funding could include:

  • A tax on financial transactions <-------------- FINANCIAL TRANSACTION TAX
  • Government subsidies diverted from fossil fuels
  • Special drawing rights from the IMF

RECENT:


5. Shift to Land/Resource Value Taxes

There are taxes that focus on depletion of natural resources ("depleter pays principle") and/or the deterioration of natural resources ("polluter pays principle"). One key tax reform proposal that deserves further consideration is the "Land Value Tax" (LVT), originally proposed by American economist Henry George in 1879. The underlying concept is to shift tax burdens from earned incomes to unearned incomes.

An International Declaration on Individual and Common Rights to Earth
Originally composed and declared at a meeting of the
International Union for Land Value Taxation held in 1949
REPRINTED WITH PERMISSION FROM EARTH RIGHTS

We hereby declare that the earth is the common heritage of all and that all people have natural and equal righs to the land of the planet. By the term "land" is meant all natural resources.

Subject always to these natural and equal rights in land and to this common ownership, individuals can and should enjoy certain subsidiary rights in land. These rights properly enjoyed by individuals are:

  1. The right to secure exclusive occupation of land
  2. The right to exclusive use of land occupied.
  3. The right to the free transfer of land according to the laws of the country.
  4. The right to transmit land by inheritance.
These individual rights do not include:
  1. The right to use land in a manner contrary to the common good of all, e.g., in such a manner as to destroy or impair the common heritage.
  2. The right to appropriate what economists call the Economic Rent of land.
The Economic Rent is the annual value attaching to the land alone apart from any improvements thereon created by labor. This value is created by the existence of and the functioning of the whole community wherein the individual lives and is in justice the property of the community. To allow this value to be appropriated by individuals enables land to be used not only for the production of wealth but as an instrument of oppression of human by human leading to severe social consequences which are everywhere evident.

All humans have natural and equal rights in land. Those rights may be exercised in two ways:

  1. By holding land as individuals and/or
  2. Sharing in the common use of the Economic Rent of land.

The Economic Rent of land can be collected for the use of the community by methods similar to those by which real estate taxes are now collected. That is what is meant by the policy of Land Value Taxation. Were this community created land value collected, the many taxes which impede the production of wealth and limit purchasing power could be abolished.

The exercise of both common and individual rights in land is essential to a society based on justice. But the rights of individuals in natural resources are limited by the just rights of the community. Denying the existence of common rights in land creates a condition of society wherein the exercise of individual rights becomes impossible for the great mass of the people.

WE THEREFORE DECLARE THAT THE EARTH IS THE BIRTHRIGHT OF ALL PEOPLE

KEY LINKS:

6. Guaranteed Basic Personal Income

BASIC CONCEPT

BIEN19862004.jpg
Source: Basic Income Earth Network (BIEN)

KEY REFERENCE

SOCIOECONOMIC DEMOCRACY: An Advanced Socioeconomic System
Robley E. George, Center for the Study of Democratic Societies (CSDS), 2002

RobleyGeorge-BookCover.gif
SUMMARY (Reprinted with Permission from CSDS)

Socioeconomic Democracy is a model economic system, or more precisely, socioeconomic subsystem, in which there is some form of Universal Guaranteed Personal Income as well as some form of Maximum Allowable Personal Wealth, with both the lower bound on personal material poverty and the upper bound on personal material wealth set and adjusted democratically by all society.

The book then individually examines in some detail each of these two bounds, i.e., UGI and MAW. Next is democracy. Here we first consider a few preliminaries, including a discussion of the inevitability of democracy, a prehistory of majority rule and a brief discussion of contemporary qualitative democracy. We then consider the simple, mathematically correct procedure by which society, exercising quantitative democracy (employing the most elemental of public choice theory results), can democratically decide the amount or magnitude of these two bounds -- and other amounts in question.

The book illustrates and looks at the many possible theoretical variations of Socioeconomic Democracy. Anthropological, philosophical, psychological, religious and human rights justifications for some form of Socioeconomic Democracy are next provided. The similarities, differences and relationships between Socioeconomic Democracy and Islami economics -- in particular, Zakat, one of the five pillars of Islam -- are examined. The book then considers economic incentive and self-interest in general and as associated with Socioeconomic Democracy. Next, the book examines a number of practical political approximations to, and some of the many financial benefits and reduced costs of, such a system. It then establishes the feasibility of and discusses the necessary implementation procedure to realize Socioeconomic Democracy. Finally, the book describes a number of the simultaneously realized ramifications of this fundamentally just and democratic socioeconomic system. The book concludes with an appendix containing exercises for the interested reader.

KEY LINKS

Work dignifies the working person, and quality work even more so. This applies to all kinds of work, from the most humble to the most exalted. The objective of guaranteed basic income is not to induce laziness but to liberate people from a salary system that incentivizes conformance rather than creativity. To ensure that this is the case, quality standards are needed.

SWITZERLAND: Petition Drive For A Referendum On A Basic Income
Felix Coeln, Basic Income News, Switzerland, 22 March 2012

On April 21st, 2012 Switzerland is starting a petition for a referendum on a basic income with a big party in Zurich. The referendum would establish the following principles in the constitution:

  • the confederation installs a basic income
  • the basic income allows the whole population a dignified life and full participation
  • the law lays down funding and amount of the basic income

The petition needs 100,000 signatures to bring the referendum to a vote. The initiative follows the national motto: Unus pro omnibus – omnes pro uno (all for one and one for all).

For further information to go: http://bedingungslos.ch/ (only German) (translations in French and Italian are going to be added). The folowing article is highly recommended:

Unconditional Basic Income as a Postpatriarchal Project
Ina Praetorius, Switzerland, March 2012

7. ISO Standards, Guidelines, and Best Practices

All humans have a propensity to cut corners. Regardless of how income is taxed (Section 5) and returned (Section 6) to tax payers, there is a continuing need for quality standards in all kinds of human work.

KEY LINKS:

RECENT:

What about quality standards for financial institutions? ISO 9000 could be used, but it would seem that the financial services industry should have a dedicated five digit standard. ISO-26000 on social responsibility is a guideline, not an auditable standard. Both stricter regulation and auditable standards are urgently needed for the global financial system.

8. Transferring Subsidies from Fossil Fuels to Clean Energy

The transferring of subsidies from the fossil fuels industry to the clean energy industry is understandably a sensitive political issue. The fossil fuel industry is enormously powerful. The age of fossil fuels has practically run its course. However, the temptation to keep producing and using "cheap energy" is very strong regardless of environmental consequences. The United States of America has yet to ratify the Kyoto Protocol because "it is bad for business." The "easy profits" derived from the exploding manipulation of worthless financial assets is also bad for business, but not yet recognized as such by the general public. Subsidies are tricky business, and there seems to be a paucity of expertise about the societal cost of subsidizing pollution-intensive industries.

KEY LINKS:

9. Fostering and Deploying Clean Energy Technologies

Beyond taxes and subsidies, what are other ways to incentivize the development and commercialization of clean energy? There are many ways to foster clean energy technologies:

KEY LINKS:

  • Financing Clean Energy

    • Primer For Financing Renewable Energy Projects, Don Madden, Tara Finance, 20 June 2011.
    • Energy Innovation Pays Off Big, Andrew Restuccia, The Hill, 28 June 2011
    • The Impact of Clean Energy Innovation, Google, 29 June 2011.
    • Innovative Sources of Climate Finance, Friends of the Earth, June 2011.
    • Dark Clouds Threaten Solar Makers' Future, Matt Daily, Reuters, 17 October 2011.
    • Excerpt: "In late 2010, solar panel makers were sold out, Germany was gobbling up record numbers of the clean energy systems, and new markets were steadily growing. Now, the erosion of subsidies in Germany and Italy, the world's two biggest markets, and rising production of the panels that turn sunlight into electricity has left the industry awash in a glut of equipment and driven panel prices down by some 35 percent this year. That is good news for consumers and distributors who buy the solar modules, but has left manufacturers reeling as their profit margins shrink and their share prices plummet to multi-year lows. Consequently, some companies have gone bankrupt. However, solar analysts have been quick to point out the young industry is now weeding out the weaker companies, and that prices for solar power are quickly approaching parity with electricity generated by fossil fuels, which is crucial for reducing its need for government subsidies. That in turn is helping spur its growth in the United States, where installations could double this year to more the 1.5 gigawatts." Source: Sustainable Energy Network, 23 October 2011.

    • Bank Says Global Investments in Renewable Energy to Rise, Vera Eckert, Reuters, 17 October 2011.

      Excerpt: "Oil and natural gas companies, pension funds and other blue-chip firms are likely to raise their investments in renewable-energy projects, thanks to shrinking costs and a faster turn around compared with nuclear power, according to a study from Swiss bank Sarasin. Banks, which tend to have a more cautious lending philosophy after the financial crisis, are more willing to lend to wind power projects with a 12 to 18 month realization time-span, for example, compared with nuclear plants, which need 10 to 15 years. The renewable-energy industry "will become the target of progressive oil and gas companies and utilities, and of blue-chip firms in conventional industries," a researcher said. Global renewable energy was the fastest growing energy sector in the past decade, reaching $200 billion in 2010, up 25% from 2009, the report showed." Source: Sustainable Energy Network, 23 October 2011.

    • Biofuels, Biomaterials Growing at Three Times the Global GDP Rate, Jim Lane, Biofuels Digest, 19 October 2011.
    • Excerpt: "A new survey says 79 percent of bioenergy executives are more optimistic both about their organization’s prospects for growth and industry growth, than 12 months ago, and that 72 percent are more optimistic about the industry’s prospects than at this time in 2010. Overall, the survey painted a picture of an industry that is expecting to grow at nearly triple the growth rate of the world economy (8.9 percent for the industry, compared to 3.2 percent for the total economy), but expecting to find generally less external support in the form of tangible support from government, and less IPO activity. Though 50 percent of respondents expect the cellulosic ethanol sector to reach 1 billion gallons in capacity, 67 percent indicated the same belief in Q1 of this year." Source: Sustainable Energy Network, 23 October 2011.

    • IEA Says Fossil Fuels Got More Aid Than Clean Energy, Ben Sills, First Enercast Financial, 19 November 2011.
    • Excerpt: "Fossil-fuel consumers worldwide received about six times more state subsidies last year than were given to the renewable-energy industry, according to the Paris-based International Energy Agency in its "World Energy Outlook." Aid to cut the price of gasoline, gas and coal rose by more than a third to $409 billion as global energy prices increased, compared with $66 billion of support for biofuels, wind power and solar energy. The Group of 20 nations in 2009 pledged to eliminate state aid for oil, coal and natural gas. However, G-20 nations spent $160 billion supporting the production and consumption of fossil fuels last year, led by Saudi Arabia’s outlay of $44 billion, the IEA said." Source: Sustainable Energy Network, 20 November 2011.

    • Preparing to manage climate change financing, Simon D. Donner, Milind Kandlikar, Hisham Zerriffi, Science, 18 November 2011.
    • Excerpt: "At the 2010 Cancun Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC), the international community agreed in principle to one of the largest development programs in history. The developed nations pledged to mobilize U.S.$100 billion per year by the year 2020 to “address the needs of developing countries” in responding to climate change. The funds, which may apply to adaptation and mitigation, are proposed to flow through multiple channels, including existing development banks, official development assistance, bilateral programs, international private investment flows (e.g., carbon markets), and other public and private mechanisms. Recommendations provided by a transitional committee for the management and operation of the proposed climate change financing will be considered by the parties to the UNFCCC at the upcoming conference in Durban, South Africa."

  • Triple Bottom Line (TBL)


  • Energy System Optimization

  • Energy Business Council (EBC)
  • IEAEBC.jpg
    From the International Energy Agency's EBC web site:

    "Regular consultations with industry make a vital contribution to the IEA's work on market and policy analysis and development.
    As the private sector is responsible for the vast bulk of energy investment, it is therefore necessary for governments and industry to work hand-in-hand to create the right framework conditions that will create clear, predictable, long-term economic incentives that empower business to undertake the huge investment programmes required for a cleaner and more efficient energy future. Given the key role industry has to play, the IEA believes there is a clear need to enhance cooperation between the energy sector and energy policy makers. The establishment of the IEA Energy Business Council (EBC) addresses this need as it seeks to act as a facilitator to ensure the voice of the energy sector is heard in the energy policy debate. The EBC is an executive-level group that represents a wide variety of companies involved in different aspects of energy exploration, production, transformation and consumption. They range from commodities companies to automobile manufacturers to wind and solar energy producers, as well as industry associations. EBC companies’ operations are international and membership of the group evolves over time according to priority issues and within the IEA."

    IEAWEO2011_ENERGY_FOR_ALL

    Publications:

    World Energy Outlook (WEO) 2011, IEA 2011
    WEO Fact Sheets, IEA 2011
    WEO Key Graphs, IEA 2011
    Key World Energy Statistics
    CO2 Emissions from Fuel Combustion 2011, IEA 2011
    Developments in Energy Subsidies, IEA 2011
    Energy for All: Financing access for the poor, IEA 2011


  • Deploying Renewables 2011: Best and Future Policy Practice, IEA, December 2011
  • The global energy system faces urgent challenges. Concerns about energy security are growing, as highlighted by the recent political turmoil in Northern Africa and the nuclear incident in Fukushima. At the same time, the need to respond to climate change is more critical than ever. Against this background, many governments have increased efforts to promote deployment of renewable energy – low-carbon sources that can strengthen energy security. This has stimulated unprecedented rise in deployment, and renewables are now the fastest growing sector of the energy mix.

    This “coming of age” of renewable energy also brings challenges. Growth is focused on a few of the available technologies, and rapid deployment is confined to a relatively small number of countries. In more advanced markets, managing support costs and system integration of large shares of renewable energy in a time of economic weakness and budget austerity has sparked vigorous political debate. The IEA’s new report, Deploying Renewables 2011: Best and Future Policy Practice:

    • Provides a comprehensive review and analysis of renewable energy policy and market trends;
    • Analyses in detail the dynamics of deployment and provides best-practice policy principles for different stages of market maturity;
    • Assesses the impact and cost-effectiveness of support policies using new methodological tools and indicators;
    • Investigates the strategic reasons underpinning the pursuit of RE deployment by different countries and the prospects for globalisation of RE.

    This new book builds on and extends a 2008 IEA publication, drawing on recent policy and deployment experience world-wide. It provides guidance for policy makers and other stakeholders to avoid past mistakes, overcome new challenges and reap the benefits of deploying renewables – today and tomorrow.

  • Top 10 Clean Tech Stories of 2011, Zachary Shahan, CleanTechnica, 30 December 2011
  • solar-energy-cost-drop-19852011

    CLICK TO ENLARGE

    1. 40% drop in cost of solar
    2. Wind energy driving down the price of electricity
    3. The Solyndra non-scandal
    4. Solar energy industries employ a ton of people
    5. Google & Facebook going clean
    6. Electric vehicles (EVs) and EV charging stations roll out
    7. Lack of strong federal clean energy policy
    8. Wind penetration hitting record levels in U.S. and abroad
    9. The public backlash against nuclear after Fukushima
    10. Better Buildings Initiative

  • Leveraging State Clean Energy Funds for Economic Development, Brookings Institution, January 11, 2012
  • [USA] "State clean energy funds have emerged as effective tools that states can use to accelerate the development of energy efficiency and renewable energy projects. These clean energy funds, which exist in over 20 states, generate about $500 million per year in dedicated support from utility surcharges and other sources, making them significant public investors in thousands of clean energy projects. However, state clean energy funds need to pay attention to critical aspects of building a robust clean energy industry, including cleantech innovation support through research and development funding, financial support for early-stage cleantech companies and emerging technologies, and various other industry development efforts. As more and more states reorient their clean energy funds from a project finance-only model in order to encompass broader economic development activities, clean energy funds can collectively become an important national driver for economic growth."

  • A Jump Start for the Clean Economy: Good news—and ongoing opportunities—for green jobs, Maria Gallucci, Yes! Magazine, 24 January 2012
  • "A little-known source of clean energy funding could prove a crucial job-creation engine in the states, as federal support diminishes and they seek fresh growth drivers.

    "Every [USA] state can create clean energy funds, or CEFs, which are typically supported by a small surcharge on monthly electricity bills. So far 22 states have done so, generating $2.7 billion overall for the clean technology sector during the past decade. Most have used the money to install tens of thousands of solar panel arrays, wind turbines and biomass facilities.

    "But a few states have gone further by broadening investments to include technology research hubs, fledgling cleantech startups and green job training programs. The idea is to use the money, which today totals some $500 million a year, to help develop all the components of the clean economy and stimulate the creation of thousands of permanent local jobs."

  • Proposals submitted for the UNFCCC Climate Technology Center and Network:
  • UNFCCC Climate Technology Center, Summary of Proposal by UNEP, Nairobi, Kenya
    UNFCCC Climate Technology Center, Summary of Proposal by Research Institute of Petroleum Industry, Iran
    UNFCCC Climate Technology Center, Summary of Proposal by Det Norske Veritas AS, Norway
    UNFCCC Climate Technology Center, Summary of Proposal by Global Environment Facility, Washington DC, USA
    UNFCCC Climate Technology Center, Summary of Proposal by Technology Information Forecasting and Assessment Council, India
    UNFCCC Climate Technology Center, Summary of Proposal by South-South Global Assets and Technology Exchange, China
    UNFCCC Climate Technology Center, Summary of Proposal by Instituto Tecnologico de Costa Rica, San Jose, Costa Rica
    UNFCCC Climate Technology Center, Summary of Proposal by Agency for the Assessment and Application of Technology, Indonesia


    |Back to the SUMMARY|

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    |Back to SECTION 4|     |Back to SECTION 5|     |Back to SECTION 6|
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