Smarter Energy Policy
A Post-Petroleum World
| Energy independence. We can have it if we work for it. |
by Bill Moore
Phil Watts, the chairman of Royal Dutch Shell, gave a remarkable speech in New York, just three weeks after the tragedy of September 11th.Accustomed to making and approving business decisions and technology plans that extend decades into the future, Watts told an audience assembled under the auspices of the United Nations Development Program, that Shell, one of the largest oil companies in the world, was preparing for the "End of the Hydrocarbon Age."
He painted two possible scenarios he termed, "Dynamics as Usual" and "The Spirit of the Coming Age."
Under the first scenario, Shell envisions an "evolutionary" carbon shift from coal to natural gas to renewables. Petroleum's current 40 percent global energy share will drop to 25 percent by 2050. Natural gas market share will climb to 20 percent while the remainder will come from a combination of nuclear and various renewable sources.
Under "The Spirit of the Coming Age" scenario, the world would experience a far more dramatic shift from carbon-intensive fuels to hydrogen. Watts stated this second scenario "explores something rather more revolutionary, the potential for a truly hydrogen economy, growing out of new and exciting developments in fuel cells, advanced hydrocarbon technologies and carbon dioxide sequestration."
Watts envisioned fuel cells beginning to reach serious market penetration by 2025 and as a result dramatically altering the energy landscape long before oil becomes scarce.
Watts isn't just talking the talk. He has pledged to walk the walk by committing between $500 million and $1 billion over the next five years to develop new energy businesses, concentrating primarily on solar and wind energy.
Watts concluded his remarks by saying that oil companies can no longer assume they will dominate the next 100 years as they have the previous century. "That would be a very complacent view."
Here is a major oil company executive publicly stating that the world is changing and his company plans to lead in this transition. He pointed out that not only does he intend to make Shell "a prime mover in this transitional period" but he also noted that "one in five of the world's population does not have access to commercial energy. It is our goal to contribute to the development of an affordable, sustainable energy system which will help reduce this sort of inequality."
It is encouraging to hear someone of Watts' stature and influence recognizing the need to address global inequalities like this, for these are the true causes of social unrest that can ultimately lead to the use of the weapon of terrorism. Phil Watts recognizes the world is changing and the September 11 attacks only underscore that reality. The real question is how will it change?
We can let the tragic events of September 11, 2001 propel us towards "Armageddon" -- something many fundamentalist Christians firmly believe is now happening.
Or we can use the minds and the love God gives us to turn this ominous situation into an historic turning point for mankind, one that will forever be remembered as the day the world "came to its senses."
So far, the US government has done virtually nothing to prepare the American people for the consequences of a protracted terrorist war fought inside our borders. Instead, it has authorized an unprecedented bailout of the airline industry with essentially no qualifying terms, passed scores of expensive "pork barrel" funding projects costing billions of dollars, and exhorted Americans to go out and spend money.
To date, no grand world strategy or vision has emerged in the wake of the World Trade Center and Pentagon disasters. The White House hasn't announced any major initiative to harden America's infrastructure, to protect its sitting-duck nuclear power plants, or to launch a "war-time" scaled effort to dramatically reduce the nation's profligate energy use.
So, it is with some irony...and hope, that it is an oil company executive who has stepped up to the challenge of trying to help define the world after September 11th and the end of the hydrocarbon age.
Just for a moment, let's take Phil Watts up on his challenge and try to imagine a new world powered by hydrogen instead of petroleum.
Hydrogen is the universe's most abundant element. It makes up two-thirds of the atomic structure of water. It can be extracted from natural gas and other fossil fuels, electrolyzed from water and generated by algae. At present, it is fairly expensive to separate, store and transport. But it can be used much like we do natural gas. It can run an internal combustion engine -- which both BMW and Ford have demonstrated -- or it can run a fuel cell and produce electricity, pure water and heat. Best of all it creates virtually no pollution and adds no carbon dioxide to the atmosphere.
The challenge of using hydrogen, however, also creates new opportunities because it is best made and used on site, as needed. There are few places on earth that don't have sufficient sunlight and wind to make feasible the electrolysis of water from photovoltaics or wind power. Given the sharp drop in the cost of wind generated electricity, now as low as 4-5 cents per kilowatt and the equally sharp decline in the cost of photovoltaic energy technology -- which is forecast to continue to decrease in cost -- it is entirely possible that these technologies someday can be "married" to create a practical, affordable, self-contained generation system that provides a home, a business or a community with electricity, purified water and sufficient heat to warm and cool buildings.
Such an approach could help overcome the obstacle of the intermittent nature of both wind and sunlight. The system could be designed to use excess electricity to create hydrogen, which is stored for use by a fuel cell or heat engine generator when neither wind nor sunlight is available.
Or instead of electrolyzing water, someday we could have waste water treatment facilities that feed tanks of hydrogen-producing algae. This approach promises to be even more cost-effective. Communities could generate their own supply of hydrogen. The problem of transporting hydrogen would be minimized if not eliminated.
Imagine the community of the future where algae-produced hydrogen powers fuel cells that produce electricity, clean water and distribute or process heat. And because of advances in energy efficiency and smart community planning, the homes and businesses in the community will utilize far less than they do today.
And in the spirit of Phil Watts' vision, this technology would be available to all. Rural villages in Malawi and Uzbekistan and Honduras could have the energy they need to improve their quality of life. The standard of living worldwide would go up, there would be greater literacy, less environmental degradation and a lower birth rate.
Gradually, there would be no government-subsidized energy monopolies. Instead there would simply be sustainable communities that live within the energy means of their environment, instead of exploiting others.
Is such a scenario feasible? Is it technically, economically, and politically possible? I believe it is.
A bigger question is, "Can human nature adapt to this brave new world?"
That is the real unknown. But we are resilient. We are adaptive. And to be perfectly honest, do we have any other choice? The wider the gulf grows between the haves and have-nots of the world, the more inequities we will see and the more terrorism we will experience.
The hydrogen economy won't solve the problem of human nature, but it might just put us back in touch with the rhythms of the planet on which we all depend. Is this the impossible dream? Perhaps. I will be the first to admit it is imperfect. But I also believe it is one worth dreaming and more importantly, striving to achieve. September 11th marks a great turning point in the history of man. Which path we take will determine whether it marks the beginning of the end or just the end of the beginning.
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