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Toward A Global Energy Transition (excerpt)

This paper details a plan with a set of three interactive and mutually reinforcing strategies designed to reduce the world's use of carbon fuels by at least 70%, and at the same time, create millions of jobs around the world, especially in developing countries. The plan is driven by concerns that global climate change is progressing far more rapidly than scientists anticipated even a few years ago.

To control the escalating pace of change and to allow the climate to re-stabilize, humanity has to cut its burning of fossil fuels by at least 70% in a very short time. That is the consensus of more than 2,000 scientists from 100 countries reporting to the UN-sponsored Intergovernmental Panel on Climate Change in the largest and most rigorously peer-reviewed scientific collaboration in history.

The urgency of the threat is spelled out in two other recent peer-reviewed studies corroborating the UN panel's findings. One focuses on environmental impacts, the other on future energy consumption.

In 2001, researchers at the Hadley Center, Britain's principle climate research institute, found that the climate will change 50% more quickly than was previously assumed. That is because earlier computer models calculated the impacts of a warming atmosphere on a relatively static biosphere. But when they factored in the warming that has already taken place, they found that the rate of change is compounding. They project that most of the world's forests will begin to turn from sinks to sources--dying off and emitting carbon--by around 2040.

The other study is equally troubling. Eleven researchers found several years ago that unless the world is getting half its energy from non-carbon sources by 2018, we will be locked into an inevitable doubling--and possible tripling--of pre-industrial carbon dioxide (CO2) levels later in this century. A follow-up study by many of the same researchers, published in Science in November 2002, calls for a crash program to develop a carbon-free energy economy. Using conservative projections of future energy use, the researchers found that within 50 years humanity will need to be generating at least three times more energy from non-carbon sources than the world currently produces from fossil fuels to avoid a catastrophic build-up of atmospheric CO2 later in this century.

The science is taken very seriously outside the United States. In other countries, hardly anybody debates whether human activities are seriously affecting the climate. The debates are about policy choices, such as how to change energy delivery structures without wrecking national economies. The agreement on the urgency of the climate threat is evident in the responses in Europe. Holland has completed a plan to cut emissions by 80% in the next 40 years. The United Kingdom has committed itself to 60% reductions in 50 years. Germany is planning for 50% cuts in 50 years.

By contrast, the White House has become the East Coast branch office of ExxonMobil and Peabody coal, and climate change has become the pre-eminent case study in the contamination of the U.S. political system by money.

Two years ago, U.S. President George W. Bush reneged on a campaign promise to cap carbon emissions from coal-burning power plants. He then unveiled his administration's energy plan, which is basically a shortcut to climate hell. In a truly Orwellian stroke, the White House excised all references to the dangers of climate change on the EPA's website in mid-2003. Finally, Bush withdrew the United States from the Kyoto climate negotiations, and the administration's chief climate negotiator declared that the United States would not engage in the Kyoto process for at least 10 years.

However, there may be an approach that could address our increasingly inflamed atmosphere and our reluctant political leadership as well. It is provisionally called the World Energy Modernization Plan. This plan was developed by an ad hoc, informal group of about 15 energy company presidents, economists, energy policy experts and others who met at the Center for Health and the Global Environment at Harvard Medical School.

The plan involves three interacting strategies. One is a subsidy switch, in which industrial countries would eliminate government subsidies for fossil fuels and establish equivalent subsidies for renewable, non-car-bon energy technologies. Another is a clean energy transfer fund, which entails creating a pool of money on the order of $300 billion a year to provide renewable energy technologies to developing countries. The last one is a progressively more stringent fossil fuel efficiency standard that rises by 5% per year; its adoption, perhaps within the Kyoto framework, could be complemented with the emissions trading mechanism to help nations meet it.

While each of these strategies can be viewed as a stand-alone policy, they are better under-stood as a set of interactive policies that could speed the energy transition far more rapidly than if they were implemented in piecemeal fashion.

We are proposing that in the industrial countries those subsidies be withdrawn from fossil fuels and equivalent subsidies be established for renewable energy sources. A small portion of the U.S. subsidies must be used to retrain or buyout the nation's approximately 50,000 coal miners. But the lions' share of the subsidies would still be intended for the major oil companies to retrain their workers and re-tool to become aggressive developers of fuel cells, wind farms, and solar systems. In other words, we envision the subsidies as a tool to help oil companies transform themselves into renewable energy companies.

The second element of the plan involves the creation of a new $300-billion-a-year fund to help transfer renewable energy resources to developing countries. Virtually all poor countries would love to go solar; virtually none can afford it. Among them are countries with the smoggiest cities in the world today, such as China, Mexico, Thailand, and Chile.

The third and unifying regulatory strategy of the plan calls on the parties to Kyoto to subordinate the ineffectual and inequitable system of international emissions trading to a simple and equitable fossil fuel efficiency standard that becomes 5% more stringent each year. This mechanism, if incorporated into the Kyoto Protocol, would harmonize and guide the global energy transition in a way that emissions trading cannot.

If the subsidy switch in industrial nations were implemented in tandem with the progressive fossil fuel efficiency standard, we believe those two policies alone could jumpstart an energy transition in the North. But, as we know, the problem is global in scope. The transfer fund addresses the fact that even if the countries of the North dramatically reduce emissions, those cuts would be overwhelmed by the coming pulse of carbon from India, China, Mexico, and Nigeria.

Full paper available at:

www.fpif.org/papers/03petropol/development.html

(Ross Gelbspan is a former reporter for the Boston Globe and the author of The Heat Is On: The High Stakes Battle over Earth's Threatened Climate (www.heatisonline.org) His latest book, Fevered Planet, is scheduled for publication in 2004 (Basic Books).)

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