November 14, 2006

The Social Costs of the Status Quo

Joel Makower, an excellent green business writer and lecturer, recently wrote an article titled A Stern Warning on Climate (and a Word about Wedges). Here are some expanded comments that I have made to his article...

When it comes to building new energy infrastructure there are costs and then there are social costs. For instance, TXU plans to build 11 coal-fired plants for Texas because they cost less than cleaner coal gasification plants. However, the social costs of coal combustion, even today's advanced technology versions, are incalculable if they increase ghg emissions, dependence on fossil fuels, and centralization of energy production.

What's interesting about the Stern Review on the Economics of Climate Change is that it focuses attention on social consequences that will arise if we ignore social costs. California, with its groundbreaking Global Warming Solutions Act, is starting to place caps and monetary value on carbon emissions through a carbon credit system. That will generate investment capital for new, more expensive but more socially responsible technologies to be deployed that may very well save us from some of the consequences of global warming.

Improving infrastructure stimulates the economy rather than depresses it - the inverse is also true. California voters just passed a staggering array of infrastructure bond measures because they understand the social costs of decaying infrastructure.

Clean conversion technologies are emerging that can reduce waste while producing biofuels and generating green electricity without further fouling the air, water, or land. Putting the brakes on emerging technology deployments by using environmental fear-mongering to suppress necessary regulatory reform could mire us in the status quo when we can least afford it.

Militant idealists of the environmental movement are going to have to suspend their cynicism about technology for us to achieve the goals listed in the Science Magazine article Stabilization Wedges: Solving the Climate Problem for the Next 50 Years with Current Technologies:
• Double the fuel economy of 2 billion cars worldwide from 30 mpg to 60 mpg
• Cut electricity use in all homes, offices, and stores by 25 percent
• Replace 1,400 large coal-fired power plants with gas-fired plants
• Increase solar power 700-fold to displace coal
• Increase wind power 80-fold to produce hydrogen for cars
• Add 100 times the current production of ethanol

The status quo dependence on raw combustion and centralized production is the enemy - not the emerging technologies, municipalities, utilities, or venture capitalists who take the investment risk to reduce the social costs of old technologies and outdated regulations.

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