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THE Powers THAT Be
GLOBAL ENERGY FOR THE TWENTY-FIRST CENTURY AND BEYOND
By Scott L. Montgomery
The University Of Chicago Press
Copyright © 2010 Scott L. Montgomery
All right reserved.
ISBN: 978-0-226-53500-5
Chapter One
WHAT BINDS US ALL
Reality is merely an illusion, albeit a very persistent one. ALBERT EINSTEIN
A BRIEF PROLOGUE
It is mid-2008, oil prices are over $140 a barrel, and there are no gas lines in America. Gas lines exist in Baghdad and Tehran, the capitals of two of the most oil-rich nations on Earth. How can we make sense of this? The price of petroleum is now higher than at any time in history, having stumbled its way to spectacular levels once thought certain to put civilization on its knees. The first great oil shock in forty years has arrived. Yet rather than chaos, we are besieged on all sides, in a presidential campaign year, by the call for a "green revolution," a new world order of "clean tech" that shall bring us, at last, into "energy independence." Such a revolution, we are told, is essential for two other reasons: economic advance in the developing world and the advent of dangerous climate change. By themselves, these phenomena demand a different long-term approach to how we power and light the planet. The globe simply doesn't have the resources to bring billions of people, once in energy rags, the riches of electricity, automobiles, and modern lifestyles using the same fuels as in the past. Thank goodness, therefore, that the oil shock is here. High prices force change. By late summer 2008, the clean tech, green tech revolution seems assured, even unquestionable.
But now it is November, and change has indeed come. Global economic crisis has brought stock markets everywhere into massive decline, with banks, investment firms, and now companies large and small failing in many parts of the globe. The entire U.S. auto industry—backbone of America's manufacturing sector—begs to be saved by a government that has staked its legacy on free market principles. Indeed, governments everywhere are in the midst of gigantic rescue efforts, with at least one (Iceland) on the brink of bankruptcy. And the price of oil? Nearly in freefall, from a peak of $147 to below $45 in a mere three months. How final, then, the sentiments of "green is the new red, white and blue"? Whereto market solutions for a "clean tech" future when $billions are bailing out banks. As the financial turmoil deepens, questions arise. What will happen to all the progress that has been made in new energy technologies, with years of hope and money behind them? Will the "green bubble" burst? What about economic growth in China and efforts to deal with climate change? Could it be—irony of the fates—that with demand for energy falling everywhere, economic collapse will prove to be the quickest "method" to lower carbon emissions and control our resource appetites? Have we reached such a point of desperation or cynicism?
A year later, in late 2009, the financial crisis is being declared over, though its effects are forecast to last for years. What has been learned with regard to energy? Our global energy system, from oil wells to solar panels, along with the trends and forces that make it work, did not come to death and dissolution. The world, in fact, has more oil than ever, even more natural gas, and is more interested than ever in "green tech." Dozens of proposals have come forth in the U.S. about how to change everything for the better, whether by "going all green" or opening all offshore areas to drilling. To those who have spent their lives in the energy industry, the ground hasn't shifted in any profound way. Boom and bust, varied political winds, and old ideas served in new bottles have long been part of the geography, which is dynamic, evolving, always seeking a balance.
Yet the truth is that change has begun. Whatever the uncertainty of the moment, there are bedrock issues, some already venerable, to be sure, but others lately arrived. How can global civilization move forward, yet also ensure a safe future for both the human and extrahuman biosphere? How can we advance modern energy, for ourselves and the billions who desperately need it, while mitigating what this might mean to lakes, rivers, oceans, the atmosphere? Nations will continue to pursue their own self-concerned agendas about energy security—the U.S. and foreign oil; China and imports; the EU and its umbilical natural gas ties to Russia; OPEC and global demand for petroleum. But all are integrated deeply, irreversibly, and more than ever before into a global web of markets and relationships. A so-called green revolution in America can't happen without causing, or depending upon, big changes elsewhere—Canada and Mexico for example, largest suppliers of oil and gas to America, or Brazil and Holland, who rely on U.S. exports of coal, or the European companies Siemens Energy (Germany) and Vestas (Denmark), the two largest manufacturers of wind energy systems. This is why "energy independence" is both impossible and, in the end, inadvisable. For politicians in an election year, it is a phrase ripe with symbolic power. But in the real world of global relations, it is a myth—the U.S., with no less than a quarter of world petroleum demand, is simply too big a consumer, too dependent on oil itself (over 90% of all transportation in America is oil driven), to cut itself off in a decade or two from the world's major suppliers, such as Saudi Arabia, Venezuela, and Kuwait. Moreover, ending supply entirely from these nations could well bring unwanted effects—destabilization, for example, opening the door to fundamentalism, and the loss of U.S. influence on countries that also supply oil to its allies and the rest of the world. Lest we forget, too, America imports solar equipment from Germany, wind turbines from Denmark, and hybrid vehicles from Japan. The dream of absolute energy independence is an unwanted fantasy of energy isolationism.
Progress can come only in a different manner. For another bedrock truth is that the future of energy must be a global future, not a protectionist one. It is, after all, the developing world that now drives the greater part of our global system, accounting for eight out of every ten units of new energy used (be they barrels or Btus)—an astounding change from decades past. If we are concerned about fossil fuels, how much may be left or what their use might bring, we must turn our gaze to nations other than those in North America and Europe. Many of the greatest triumphs and also tribulations of the decades ahead—from securing food and clean water to battling disease and ensuring the vitality of cities—will return, sooner or later, directly or subtly, to how this fact is dealt with in a global way.
For now, "energy" is a word on many lips, as well it should be. Economic crisis hasn't removed any of the urgency from this domain—on the contrary. The recent oil shock wasn't like those of the 1970s, when actions by the Organization of Petroleum Exporting Countries (OPEC) created shortages and price spikes. Between 2002 and 2008, there were real problems of demand and supply, the one having grown too fast, the other too slowly. Too little new production was developed in the 1990s, and too few refineries were built, so that in the first decade of the new century the world of oil was caught unready for a surge of appetite from Asia. And with things so tight, there appeared threats to supply that had never really mattered before—hurricanes, sabotage, oil worker strikes. The global financial crisis thus (again, ironically) arrived to help loosen everything up, cool off consumption and demand—for the moment. What happens when the global economy recovers?
America had no gas lines in 2008, because it wasn't 1973. Policies had changed. Some lessons had been learned. In 2008, the U.S. had large fuel stocks and no price controls; this time prices were allowed to rise, and people responded by cutting back on driving. Iran, meanwhile, had gas lines for exactly the same reason in reverse, because it subsidized gasoline to a huge degree, keeping it extraordinarily cheap (about 25 cents/gal in 2008) and demand for it therefore extremely high. A nation of over 65 million people with growing car sales, Iran in 2008 was the second largest importer of gasoline after the U.S. Its need for crude was soaring for another reason, too, since it uses oil to generate electricity. Yet its oil fields have been rapidly depleting, by 8%-11% a year. Instead of slowing this bleed, by investing profits in better recovery and upgrades to decrepit supply infrastructure, Iran has preferred to pour its cash into social welfare, to keep its poorer people "happy." What does this mean? With rising demand and falling production capability, future exports will inevitably suffer. At current rates, they could dwindle to small digits or even disappear before long. Thus Iran's claim that it needs nuclear power for electricity may indeed, in some part, have validity—as a mark of its own mismanagement. Then there is Baghdad. Gas lines in 2008 came from sabotage, theft, and corruption in the wake of the U.S. invasion of 2003. Again, we don't need a full accounting to tell us that it isn't 1973 or 1979 in Iraq either.
There are differences of scale, too. Earlier oil shocks delivered considerable new income to petroleum-rich states. From 2006 to 2008, however, we witnessed the greatest transfer of wealth since Genghis Khan appropriated the fertile lands and shining cities of Asia and the Near East. Literally trillions of dollars moved from oil-consuming to oil-exporting nations. In 2008, oil revenues for Saudi Arabia and Russia, the world's two largest suppliers, reached $1 billion per day. Import levels were at 50% in China, 60% in America, higher in Europe, and in Japan and Korea over 85%. Meanwhile, there are no clear alternatives to oil on a mass, global scale. Despite these very basic facts, however, many people continue to speak of the "end of the fossil fuel era."
Energy matters are critical to understand because they are fundamental to our way of life and because they are the subject of endless misconception, misrepresentation, and, as already noted, myth. Several years ago, the journalist Paul Roberts wrote of Americans as "energy illiterates," conveying a feeling (based in frustration) widely shared among experts in the industry. The term, potent and suggestive, is often deserved, even if it doesn't capture the reality entirely. People in the U.S. do have a certain working vocabulary about energy. Yet it is one that is incomplete and often imbalanced, full of notions that have been absorbed "along the way." Unfortunately, it is difficult to learn about energy in a nonpartisan setting, especially when it comes to the real world. That people are left to fend for themselves in this critical area of understanding is perhaps the real issue, a matter less of illiteracy than absence of curriculum. There are big reasons for a book such as this one, in other words.
DEFINITION: WHAT ARE WE REALLY TAKING ABOUT?
How should we think about energy then, in realistic terms? Consider the book you hold in your hand. How was it made? By the author at a computer, using electricity from a hydro-station (Washington State), in a room warmed by natural gas. There are lights in this room, a radio playing, a printer, a cup of coffee. When completed, the manuscript goes to reviewers in similar settings, then to editors, also with computers, phones, printers, and more, powered, perhaps, by coal or nuclear energy. Next comes the paper mill, using more electricity and heat; the chemical plant, where ink is born (more power, heat); the printer's shop and bindery (still more); delivery of the final product by air and truck; and, of course, its final transport home, to warm and lighted rooms, perhaps with a concluding mug of java to make the circle complete.
A book, in short, is no static object but a kind of social container, bursting with resources and processes. The same, indeed, can be said for any other objet d'art, whether made of stone, canvas, film, or text. We may speak of genius and inspiration, higher pleasures and heavenly beauty, yet it is the things of this Earth-coal, petroleum, gas, water, wind—that give such brilliance a material reality. A simple truth, conveniently (and understandably) left out of courses on the humanities.
The average American house uses somewhere around 30 kilowatt-hours (kWh) per day, while in Europe and Japan, where homes are much smaller, the figure is half of that or less. But this leaves out entirely all the consumed energy embodied in building the house, and in manufacturing its contents—all the resources and electricity and labor that went into the making and transporting of each item of lumber and furniture, article of clothing, appliance, dish, toy. Wherever we live, we are, in a wholly literal way, utterly immersed at every moment in the things that energy consumption brings. Energy use is what binds us most immediately to the world around us, to our style of living, and to each other as well. To be free of all this would mean a solitary life in a fireless cave.
So how to understand "energy," in real terms, for our purposes? Scientifically, it is defined as "the capacity to do work." This is a textbook mathematical definition with a specific type of meaning (work = force x distance). Certainly it's helpful if we paint a mental picture, but still abstract and only partly useful. Interestingly, more help, and some rich implications, can be derived from a source usually thought to be even more technical in nature—the three laws of thermodynamics. But when looked at simply, these prove to be powerful ideas that underlie everything we do with energy. C.P. Snow, the well-known English scientist and novelist (author of the famous book on the "Two Cultures"), came up with a nice way of understanding these laws. I paraphrase him as follows:
First Law: You can't get something for nothing (energy can be transferred from one system to another but never created or destroyed; it is always conserved).
Second Law: You can't break even, either (energy transfer is an irreversible process and always involves some losses, expressed by an increase in the disorder, or entropy, of a system).
Third Law: You can't get out of the game (there is such a thing as absolute zero, where all atomic movement ceases, but it's unattainable).
Together, these principles, among the most basic in all of science, keep our feet on the ground. Energy in society is about transformation—creating, building, altering, moving, and even demolishing things—and that the processes involved have inevitable limits. These limits can never be avoided and should never be ignored; no process can ever be 100% efficient (energy out equals energy in), and precious few ever get anywhere close. We can't, for example, burn natural gas to make high- pressure steam, use this steam to spin a turbine, and have the turbine generate electricity, without giving up a lot of the original energy content to "waste" heat and friction. If the first law says that what you start with is all you've got, the second law says you'll be giving up some of it all along the way, at every step, to the merciless god of entropy. Yet there are positive implications, too. We can raise the performance of any system by improving the efficiency in any one of its steps; if we improve all of them, even a little, we will gain much, especially over time and especially if the process is used on a large scale in society. Thermodynamics also tells us, therefore, that some of what we lose today we can possibly stop losing tomorrow—if we are willing to put in the hard work and imagination necessary.
These sound like moral lessons from the lap of science. They aren't. Energy in our world has a material basis. We don't import or trade "energy," after all. Homes, businesses, and vehicles do not consume ineffable mathematical formulas. They burn natural gas in stoves and gasoline or diesel in engines, use electricity to create light and wind to create electricity. "Energy" always means the use of some substance—fossil fuels, flowing water or air, enriched uranium, sunlight, volcanic fluids. It entails, first of all, specific resources.
Resources, however, bring with them the issues of availability, cost, impact, and sustainability. Unlike the ancient Greeks, we worry that the energy materials on which our society has been built—coal, oil, and natural gas above all—cannot last a great deal longer at the rate we are using them. And still the global reach of fossil fuel dependence has not yet peaked; many parts of the world, as already noted, are rushing towards it. Climate change, directly related to energy use, opens up a new domain of conflict and possible cooperation. Fossil fuels belong to individual nations, yet their use has effects on the world community, on future world communities, and on nature as well. "We all breath each other's air," notes atmospheric chemist Daniel Jacob. There are security questions, too: climate impacts, such as extreme weather or drought, may be capable of destabilizing cities, causing migrations, intensifying border conflicts, damaging life-support systems. For these and other reasons, climate has begun to affect the direction of energy policy. Over the long haul, this newest of priorities may well turn out to be a determining factor in compelling a different future.
A BIT OF CONTEXT
What, then, does our energy landscape look like today? Where do we stand, as a world, with regard to resources and options, politics and policy? In what directions are we headed? Such are the questions underlying this book, among the great questions of the present. For the U.S., they appear especially urgent, and they are—unless we consider all the other nations of the globe, for whom energy is no less a priority concern.
(Continues...)
Excerpted from THE Powers THAT Be by Scott L. Montgomery Copyright © 2010 by Scott L. Montgomery. Excerpted by permission of The University Of Chicago Press. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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