Tag Archives: alternative technology

Five Reasons why the War of Energy Technology is on

The war of energy independence is on! Like all wars there will be losers. And like some wars, we stumbled into this one. Through the narrowing of options, outdated partnerships and the emergence of new options, the global energy landscape is getting on a new footing. Bold statements can be used to describe any period in our recent energy history. But there are five reasons why the War of Energy Independence is on:

1: High oil price

High oil prices are driving diversification. The global economic decline and the link to oil is clear, policy makers must  now attempt a partial break between the oil based economy and economic growth. It would be great to pronounce this break as a clear strategy that governments are pursuing, but while the logic is there, the policies and actions are not. Greater oil dependency may also create war (Iraq et al.) and even now reducing oil usage creates a more effective US military.

2: Shale gas technology

As sexy as it is to cite shale gas as a game changer, there is no doubt it has altered the carbon landscape in the US. It is also the biggest indicator of the technological based war for energy independence. The dramatic impact it has made in the US and what the US economy can achieve through cheap gas, indicates the fossil fuel era is not over, but on a new course. It is also a clear export technology the US is pushing throughout the world. For us observers in the CEE region, the US government just a few years ago was absent. Starting in Hungary and spreading throughout the region, with the emergence of the shale gas potential, the US government and the oil majors are now more than happy to show up to energy conferences. The push for energy diversification for the CEE/SEE countries, away from Russia, is supported by the US government by using shale gas technology – not renewables. Overall, whether in the US or Europe gas from shale deposits can provide diversification and increase national energy security.

The war is on: Technology killing off big oil – but is it possible? Can a politician kill oil dependency?

3: Nuclear is out-ish

With the anniversary of Fukushima on us, the profound impact it has had on the nuclear industry in the Europe and America as a widely deployed technology means it is now a marginal technology. I am a supporter of nuclear power, but it remains hard to see how the third and fourth generation reactors, that are much safer, can be deployed to demonstrate its long-term viability. If we live in an age of competitive markets with short term investments dominating the energy landscape, then long term projects like nuclear (or Nabucco) will be the rare exception. For these to go ahead, other factors like energy security (or corrupt business practices) will have to overcome the current financial and even technical realities of alternatives that are now present. Thus, in one sense this war based on a technological race may have its first victim.

4: Renewable Energy – it is here and now

The wide deployment of renewable energy and the demonstrated success of it means it is here and now. Technological success is not a question – it is just a question of whether governments will enable it to succeed – and at what level. As Germany is demonstrating you can have a future without nuclear and with large, large scales of clean energy technologies.

5: Energy Efficiency– well, is it here?

The big acknowledgment that energy efficiency plays in an essential role in a low carbon economy is as persuasive as clean air is good for us. But what is being done? The dispersed action that must occur means creating effective energy efficiency schemes are not as easy as building a centralized generation plant. It take local and national action to make it happen, along with creative financing. The pay-offs are huge and can make a significant difference in ‘winning’ the War of Energy Independence. But the wide spread deployment of energy efficiency measures remains a battle that still must be fought.

Technological race

The war is spreading beyond Washington and Brussels. In Bulgaria there is now the Movement for Energy Independence (DEN) that seeks to create an energy strategy built on technologies and resources not dependent on Russia – including re-evaluating and using shale fracturing technologies. This movement on the European periphery is indicative of the merging of three issues: 1) energy security, and a push for reducing reliance on Russian energy dependence (gas, oil and nuclear), 2) the viability of renewable energy technologies, and 3) the broader issue of climate change. The necessity of having a carbon based economy is no longer there. Proven technologies can now be utilized that are distributed, or the resources are delivered from multiple sources, located nationally or regionally.  Gas, can now come from shale deposits, LNG or by pipeline from non-Russian sources. Oil’s high price creates an inducement to move away from it, while energy efficiency can reduce demand for all energy inputs. Who wins the war of independence will play out in the corridors of power – politicians now hold the key to decide which technologies will be favored.

War of Energy Technology - starts now

 

Shale gas, time for traditional risk assessment, part II

If there is ever a question of whether fossil fuels will survive the rise of renewable energy, we only need to look at the decimation of whales to understand resource depletion. The industrial harvesting of blubbery wales resulted in their near extinction from the sea in the mid-1900s (podcast). It is a stark and exaggerated comparison, but it serves the point to demonstrate the industrial drive that occurs for extracting the earths resources. It is now time to see that renewable energy, energy efficiency and even the concept of peak oil will not stop the resource drive for oil and gas. Just as the green energy movement is riding on technological advances, so is oil and gas.

Part one of this article on shale gas laid the foundation for a risk assessment. Do the laws of gravity actually apply to the high-flying shale gas industry and all the media hype? Yes, laws, regulations and even social support constrain and direct shale gas investment. In part two, of this article I will now address two types of risks that I had not expected to apply to the shale gas industry, technological lock-in and institutional lock-in. The risks on environmental compliance and regulatory risk, are the ones that jump out the most. But it is better to go deeper into these less addressed risks to understand the more obvious.

Technological advances for ‘unconventional,’ ‘tight gas,’ or ‘shale gas’ stem from (the obvious) movement from ‘conventional gas’. Technology keeps advancing. The price of oil is only on an upward trajectory. Gas is now the alternative fossil fuel; but security of supply concerns must be addressed at reasonable market prices. This can be done by using more advanced technologies to extract gas. In this review of emerging oil and gas technologies, gas to liquid technology can fuel cars, or in this review of shale technology, extraction of gas and oil from ‘super fracking’ becomes even more efficient. Both demand and supply sides of fossil fuels are now adjusting to market and technological conditions and potential.

If there are advances in technology, then why would technological risk even be an important factor to consider? My previously developed definition of technological lock-in (altered from Gregory Unruh’s, 2000 & 2002) is, “Perpetuation of a dominant design that is inferior to newer technology. Industries that have a significant systemic-technological relationship are most susceptible, due to buffered market forces.”  

Technological lock-in can also emerge through ‘institutional lock-in‘ which understands that regulatory (or other state) institutions only change slowly to protect past investments in the energy sector. Due to social and political considerations state institutions may prevent the roll-out of newer technology.  Older approved technologies will need to be used, even if output declines due to resource depletion. In this consideration, owners of other types of technologies may want to prevent the deployment of newer technology.

There is strong social and political resistance to shale gas extraction technologies, as seen in France and Bulgaria that have bans on the technology. The recent report on the legal framework  in Member States highlights the nascent industry of shale gas in Europe. With only Poland moving ahead strongly, but currently with very small production levels. The report demonstrates that there is scope for improving environmental and public review of shale gas projects (despite media reports that currently not much needs to be done).

The supporters or geopolitical energy realist, may have been caught off-guard and the quick introduction of shale gas bans. But there is now public and private push back against these bans, and no doubt there will be a reconsideration of the role that shale gas (and oil) play in national energy strategies. In France it is possible there will be a re-examination. In Bulgaria a group of energy experts see the current energy policy short sighted, with shale gas as a potential booster to the country’s energy security issues – with now almost total dependency on Russian gas. Just as Poland sees the drive for greater energy security lying in shale gas, so may Bulgaria.

Lock-in or lock-out of gas technologies?

Improvement through the technological process of fracking and shifts in state institutions, through greater environmental reviews and a broader understanding of the benefits and drawbacks of shale gas technologies all influence deployment. As the technology of fracking improves, the industry becomes more knowledgeable about the local geology and political/public landscape, and as state institutions introduce regulatory safeguards – responding to public concerns, shale technology will become more widely deployed. Mitigation of the more obvious regulatory and environmental risks emerge from addressing the technological and institutional risks.

This debate and discussion is set on the background of the geopolitical landscape of energy independence. Technological advances are not only for solar and wind power, the dominant position the fossil fuel industry and its ability to innovate and evolve, reflecting market and political-social realities, this should not be underestimated. The future energy mix – realistically, continues to rely on fossil fuels, resource depletion is the end-game, but improved innovation and technology will ensure it continues to compete and (hopefully) contributes to a cleaner and low-carbon energy future.

 

Citations:

Unruh, Gregory C., 2000. Understanding carbon lock-in. Energy Policy 28 (12),
817–830.
Unruh, Gregory C., 2002. Escaping carbon lock-in. Energy Policy 30 (4), 317–325

I have to thank the Atlantic Council’s Emerging Leaders in Environmental and Energy Policy (ELEEP) online group for some of the articles cited here – and also a source of inspiration for exploring this topic more.

 

 

Making institutions that serve our children

The matter that institutions are made of is routines, rules and structure. This can both prompt and inhibit innovation. New institutions are conceived in a time and place to meet pressing needs. Overtime, the rules and structures that were put in place age, however as both external and internal factors change (i.e. personnel, technologies and political-social circumstances) institutions can become restrictive unable to meet new demands and address opportunities.

Institutions are essential for change, but they can hold back ideas and technologies, leading to institutional and technological lock-in..

 

The examination I have done on the topic of risk governance applies to broad based institutions. My recent keynote speech at the EU-US Summit on Science, Technology and Sustainable Economic Growth, addressed the need to “break rulez” to prompt a more rapid uptake in new low/zero carbon technologies.  The presentation was a challenge for me, because I had both the opportunity to show my well constructed research to a wide audience but I also wanted to convey a sense of urgency – radical urgency. And convey it with emphasis that stays within an academic discourse (thus keeping people just on the edge of falling asleep).

The reason for my emphasis on ‘urgency,’ or ‘the pace of change’ as I framed it, is essential if we are to achieve an almost zero carbon energy system by 2050. Therefore it becomes almost impossible to speak of reaching these goals without discussing how to revitalize, restructure and revamp institutional processes in an urgent manner. Rulez need to be broken.

During the day long program, the urgency of the need to develop and deploy zero carbon processes and technologies was stated well by Nick Gotts, of the James Hutton Institute, when he rebuked another speaker that said we need to gradually roll out  new technology. Nick said we can’t wait another generation or two to begin rolling out new technologies, the significant consequences of failing to act now, will only be felt after 2050. Patrick Criqui, director at the Centre National de la Recherche Scientifique (CNRS), later finished this thought by stating that we are working for the babies of today. And he is absolutely right.

My two year-old son was sick last weekend and had a high fever.  Whenever there is a fever in the house, my wife and I go through the same discussion. She takes the temperature, looks at the thermometer and then says, “Oh – its 39 degrees.”  And then I ask “what’s that in Fahrenheit? Is it high?” –  I only know what ‘normal’ and ‘high’ are in Fahrenheit. So I feel the child’s forehead. Then I know how hot the fever is. But really, at the end of the day, does it matter if the fever is 38 or 40? You have to take action to reduce the fever. Even with his high fever, my son kept telling me, “let’s go dad, let’s go outside.” He’s picked up my restlessness.

Inaction only perpetuates the current condition. My effort to break institutional lock-in and ensure the wide deployment of new technologies is based on this restlessness. At least, when my son is older, he can understand why I was always pushing for all of us to get going. It doesn’t matter what the temperature will be in 2050. It will be hot, and the environment and us will suffer, thus action must be taken now. The current pace of change is not enough to stop the fever. The rulez institutions hold onto, like mementos from their own childhoods, need to be broken. It is the children of today that the institutions need to serve.

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The question becomes can you carry the inspiration for fighting institutions from your youth to middle age and beyond? Can the energy of the mosh pits of the 1990’s be transformed to fight climate change? Do we become lazy and content like the baby boomers and fail to make change like they said they would in the 1960’s and 1970’s. Can we afford to fail the next generation?