Energy and the Global Economy Gordon J. Aubrecht, II author of Energy: Physical, Environmental, and Social Impact (Prentice Hall, 2006) http://vig.prenhall.com/catalog/academic/product/0,1144,0130932221,00.html Physics Education Research Group Ohio State University Marion Campus Talk presented at Great Decisions, 6 March 2009 Abstract: The Fourth Assessment Report of the IPCC was released in 2007 and dealt with the scientific basis for climate change, consequences of emissions, and mitigation and adaptation. The cost of oil (in constant dollars), and the gasoline made from it, was higher through the first half of 2008 than at any time in history before declining with the global economic downturn. In response, for the first time in decades, Americans drove less. For the first time, a majority of Americans polled understand that global warming will lead to significant change in climate. How will these changes affect future actions of citizens of North America and the world? What can be done to protect the future of our children and grandchildren? This talk will focus on human effects on Earth and their import for the future of the global economy. All of us live on this precious jewel of a planet. How many of us have not been moved to see the photographs of Earth from space? But now there are more than 6.5 billion of us here, and nearly half must live on under $2 a day. The poorest people live in a world shaped by the rich countries. In yesterday’s Delaware Gazette, there was a letter to the editor from Mr. Rob Kessler entititled “‘Smart’ drivers are fooling themselves.” Among other things he said was “What a bunch of hogwash! I am so tired of hearing about man’s effect on so-called global warming and climate change. We couldn’t alter the climate even if we tried. The truth is, Mother Nature does more to harm the environment and climate than Man could ever possibly do. Do you actually know how much garbage is spewed into the air when a volcano erupts or how much methane gas is emitted because of cow flatulence? What utter hubris it is to think that man has the ability to alter the awesome forces of nature!” Actually, yes, Mr. Kessler. Humanity does have the ability to alter the environment. It seems likely that humans have been affecting the environment for over five thousand years. Let’s take the statement about cow flatulence, indeed a big source of methane emissions. Why is this a problem? Well, there are now about 1.5 billion cows in the world. How many cow ancestors were there prior to domestication some 5 to 10 thousand years ago? Clearly, not that many! Who is responsible, Mr. Kessler, for this large a number? We are. And cows release almost one-fifth of the world’s greenhouse gases, mostly through belching (but also through flatulence). Total methane emission is 53.9 Mte/yr. How many were there before humans domesticated cattle? We can’t know, but in sub-Saharan Africa, there are roughly 100,000 hippos. Because there was probably about five to ten times as much land suitable for grazing herbivores in the world, we can guess that the ancestral cattle population was perhaps 500,000 to 1 million. That’s one-fifteen-hundredths of the number of cattle today. Humans have made a pretty big difference. If we add sheep, goats, pigs, and other domesticated animals, the amount of methane generated per year by animal husbandry increases to about 80 Mte. Humans in large numbers are fishing the oceans barren. Anyone who looks at the data can see that 6.5 billion humans do indeed affect Mother Nature. Even humans in small numbers do have effects on climate. Ruddiman has shown that the difference between this interglacial and the preceding three (all driven by the same Milankovich parameters) began around 7500 years ago. This is the time when domestication was taking place, when trees were being felled for arable land, when rice (a prodigious methane emitter) was being domesticated. Volcanic emissions certainly affect Earth. No one doubts that. Mt. Pinatubo lowered the world’s temperature by 0.5 °C in 1992 by virtue of the 25-30 million tonnes of SO2 it put into the atmosphere, the most massive sulfate aerosol cloud since the Krakatoa eruption of 1883 (which put over 20 km3 of dust into the stratosphere). This sulfate aerosol and stratospheric dust cools Earth. QuickTime™ and a decompressor are needed to see this picture. USGS Volcanic emissions include CO2. Volcanic activity releases about 130 to 230 Mte/yr of CO2, a large amount of course. However, Mr. Kessler, humans currently release over 8 Gte/yr —over 35 times as much. So, I’m going to show you why humans are implicated in global warming in addition to talking about energy and the economy. The best source of material is the Intergovernmental Panel on Climate Change (IPCC), run by the UN and the WMO (World Meterological Organisation). Many of you have heard of the IPCC. For those of you who have not, it is run by the UN and the WMO and is made up of scientific experts who comb through what is known in the scientific literature and summarize the findings. Diversity of views is solicited. About one-third of the scientists in the first assessment participated in the second, about one-third who were in the second participated in the third, and so on. Governments (180 members) vote line by line on the Summaries for Policymakers. (You may have heard of the resistance of the US and China to these reports in 2007, which reports do reflect their objections.) Here is an extremely condensed summary of the results of the four assessments to date: 1990 First Assessment Report “The unequivocal detection of the enhanced greenhouse effect from observations is not likely for a decade or more.” 1995 Second Assessment Report “The balance of evidence suggests a discernable human influence on global climate.” 2001 Third Assessment Report “There is new and stronger evidence that most of the warming observed over the last 50 years is attributable to human activities.” 2007 Fourth Assessment Report “Most of the observed increase in globally averaged temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic greenhouse gas concentrations.” Terminology used by IPCC Likelihood of the occurrence / outcome Virtually certain >99% probability Very likely 90 to 99% probability Likely 66 to 90% probability About as likely as not 33 to 66% probability Unlikely 10 to 33% probability Very unlikely 1 to 10% probability Exceptionally unlikely <1% probability Let me repeat the last statement from the 2007 Fourth Assessment Report, which may not have looked very impressive when you saw it: “Most of the observed increase in globally averaged temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic greenhouse gas concentrations.” Very likely means a 90 to 99% probability! IPCC was not kidding around about this. The IPCC report actually comes from amalgamation of results from three separate Working Groups: the scientific basis (WG1); impacts, adaptation, and vulnerability (WG2); and mitigation of climate change (WG3). Why CO2 is implicated … Humans began to affect the world when people began to clear land and grow crops around 8000 years ago. Then the industrial revolution involved fossil fuel burning on an unprecedented scale. How human CO2 is implicated (US emissions) How human CO2 is implicated (US energy) How human CO2 is implicated How human CO2 is implicated Photosynthesis — on land or in the sea — always takes more of the lower-mass carbon (carbon-12) from the mix of available CO2. So carbon fixed by plants will always have a 13C value less than that of the source CO2. Electricity & transportation emissions are growing fastest. “Defining what is dangerous anthropogenic interference with the climate system and, consequently, the limits to be set for policy purposes are complex tasks that can only be partially based on science, as such definitions inherently involve normative judgments.” —IPCC Working Group 3 Table 1. A simple typology of uncertainties Type Unpredictability Indicative examples of sources Projections of human behaviour not easily amenable to prediction (e.g., evolution of political systems). Chaotic components of complex systems. Typical approaches or considerations Use of scenarios spanning a plausible range, clearly stating assumptions, limits considered, and subjective judgments. Ranges from ensembles of model runs. Table 1. A simple typology of uncertainties Type Structural uncertainty Indicative examples of sources Inadequate models, incomplete or competing conceptual frameworks, lack of agreement on model structure, ambiguous system boundaries or definitions, significant processes or relationships wrongly specified or not considered. Typical approaches or considerations Specify assumptions and system definitions clearly, compare models with observations for a range of conditions, assess maturity of the underlying science and degree to which understanding is based on fundamental concepts tested in other areas. Table 1. A simple typology of uncertainties Type Value uncertainty Indicative examples of sources Missing, inaccurate or non-representative data, inappropriate spatial or temporal resolution, poorly known or changing model parameters. Typical approaches or considerations Analysis of statistical properties of sets of values (observations, model ensemble results, etc); bootstrap and hierarchical statistical tests; comparison of models with observations. This Tony Auth cartoon (published in The Philadelphia Inquirer on April 10, 2007) gives a slightly scary view of the IPCC Fourth Assessment Report IPCC Working Group 1 says: The global atmospheric nitrous oxide concentration increased from a preindustrial value of about 270 ppb to 319 ppb in 2005. The growth rate has been approximately constant since 1980. More than a third of all nitrous oxide emissions are anthropogenic and are primarily due to agriculture. The combined radiative forcing due to increases in carbon dioxide, methane, and nitrous oxide is +2.30 [+2.07 to +2.53] W m–2, and its rate of increase during the industrial era is very likely to have been unprecedented in more than 10,000 years. IPCC Working Group 1 says: “Warming of the climate system is unequivocal, as is now evident from observations of increases in global average air and ocean temperatures, widespread melting of snow and ice, and rising global average sea level.” IPCC Working Group 1 says: “At continental, regional and ocean basin scales, numerous long-term changes in climate have been observed. These include changes in arctic temperatures and ice, widespread changes in precipitation amounts, ocean salinity, wind patterns and aspects of extreme weather including droughts, heavy precipitation, heat waves and the intensity of tropical cyclones.” “Palaeoclimatic information supports the interpretation that the warmth of the last half century is unusual in at least the previous 1,300 years. The last time the polar regions were significantly warmer than present for an extended period (about 125,000 years ago), reductions in polar ice volume led to 4 to 6 m of sea level rise.” IPCC Working Group 1 says: “Most of the observed increase in global average temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic greenhouse gas concentrations. This is an advance since the TAR’s conclusion that ‘most of the observed warming over the last 50 years is likely to have been due to the increase in greenhouse gas concentrations’. Discernible human influences now extend to other aspects of climate, including ocean warming, continental-average temperatures, temperature extremes and wind patterns.” “For the next two decades, a warming of about 0.2 °C per decade is projected for a range of SRES emission scenarios. Even if the concentrations of all greenhouse gases and aerosols had been kept constant at year 2000 levels, a further warming of about 0.1 °C per decade would be expected.” “There is now higher confidence in projected patterns of warming and other regional-scale features, including changes in wind patterns, precipitation and some aspects of extremes and of ice.” Note the blue. It shows the effect of natural emissions. The IPCC does NOT ignore natural causes as Mr. Kessler and others suggest. Observed temporal changes in animals and plants with changes over the same time periods in observed temperatures as well as modeled temperatures using (i) only natural climate forcing; (ii) only anthropogenic climate forcing; and (iii) both forcings combined. Neither works well by itself—both are needed. IPCC Working Group 1 says: “Both past and future anthropogenic carbon dioxide emissions will continue to contribute to warming and sea level rise for more than a millennium, due to the time scales required for removal of this gas from the atmosphere.” If T ~ 1.5 °C - 2.5 °C, 20% to 30% of plants and animals at high risk of extinction. IPCC Working Group 2 says: Temperature changes in 5° by 5° cells that cover the globe, 2001-2006. The expected random result is in gray (curve). Blue shows cooling. Red shows warming. What’s happening to Earth’s temperature? (IPCC, to 2006) QuickTime™ and a QuickTime™ and a decompressor decompressor are needed to see this picture. are needed to see this picture. QuickTime™ and a decompressor are needed to see this picture. United States annual temperature--the 25 warmest years (°C) Note that 9 of the warmest 25 years are from the past decade (red). The missing year is 2008, which was the 39th warmest in the 114 years of US temperature history at 11.68 °C (ahead of, for example, 1997 at 40th). One would expect that smaller landmasses would exhibit more variation than the globe. 1 1998 12.82 2 2006 12.80 3 1934 12.68 4 1999 12.60 5 1921 12.52 6 2001 12.45 7 2007 12.43 8 2005 12.42 9 1990 12.38 10 1931 12.38 11 1953 12.31 12 1987 12.28 13 1954 12.28 14 1986 12.27 15 2003 12.23 16 1939 12.23 17 2000 12.22 18 2002 12.19 19 1938 12.19 20 1991 12.17 21 1981 12.17 22 2004 12.13 23 1933 12.08 24 1946 12.07 25 1994 12.03 Let’s look at the global temperature. What is the chance that so many of the last 25 warmest years (in red) were among the last 25 years? Not very large! 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 GISS Year Annual Mean Temperature 2005 2007 1998 2002 2003 2006 2004 2001 2008 1990 1995 1999 1991 1988 2000 1997 1981 1996 1987 1983 1994 1980 1989 1986 1993 14.76 14.74 14.72 14.69 14.67 14.66 14.6 14.57 14.54 14.48 14.46 14.46 14.44 14.42 14.42 14.41 14.4 14.39 14.35 14.34 14.32 14.28 14.28 14.19 14.19 NOAA Annual Mean Temperatures (°C) Year Land Water 2007 2005 2002 2006 1998 2008 2003 2001 2004 1999 1995 1997 1990 2000 1988 1991 1981 1994 1983 1987 1989 1938 1944 1993 1996 9.52 9.48 9.36 9.34 9.34 9.30 9.28 9.26 9.23 9.20 9.16 9.07 9.06 9.03 8.93 8.92 8.90 8.87 8.87 8.78 8.74 8.74 8.74 8.73 8.72 1998 2003 2005 2004 2006 2002 1997 2001 2007 2008 1995 2000 1990 1991 1987 1999 1996 1994 1988 1983 1993 1992 1980 1944 1989 16.58 16.58 16.57 16.56 16.55 16.55 16.53 16.50 16.48 16.47 16.41 16.41 16.41 16.39 16.39 16.39 16.37 16.35 16.34 16.34 16.32 16.31 16.30 16.30 16.30 2005 1998 2002 2003 2006 2007 2004 2001 2008 1997 1995 1999 1990 2000 1991 1988 1987 1994 1983 1996 1981 1993 1944 1989 1992 Combined 14.51 14.48 14.46 14.46 14.46 14.45 14.44 14.40 14.39 14.36 14.30 14.30 14.27 14.27 14.22 14.19 14.19 14.18 14.17 14.16 14.13 14.12 14.11 14.11 14.09 Hurricanes QuickTime™ and a decompressor are needed to see this picture. IPCC Working Group 3 says: Global greenhouse gas (GHG) emissions have grown since pre-industrial times, with an increase of 70% between 1970 and 2004. (high agreement, much evidence With current climate change mitigation policies and related sustainable development practices, global GHG emissions will continue to grow over the next few decades. (high agreement, much evidence). Both bottom-up and top-down studies indicate that there is substantial economic potential for the mitigation of global GHG emissions over the coming decades, that could offset the projected growth of global emissions or reduce emissions below current levels. (high agreement, much evidence) IPCC Working Group 3 says: Energy efficiency options for new and existing buildings could considerably reduce CO2 emissions with net economic benefit. Many barriers exist against tapping this potential, but there are also large co-benefits. (high agreement, much evidence). The economic potential in the industrial sector is predominantly located in energy intensive industries. Full use of available mitigation options is not being made in either industrialized or developing nations. (high agreement, much evidence) Agricultural practices collectively can make a significant contribution at low cost to increasing soil carbon sinks, to GHG emission reductions, and by contributing biomass feedstocks for energy use. (medium agreement, medium evidence) IPCC Working Group 3 says: Geo-engineering options, such as ocean fertilization to remove CO2 directly from the atmosphere, or blocking sunlight by bringing material into the upper atmosphere, remain largely speculative and unproven, and with the risk of unknown side-effects. Reliable cost estimates for these options have not been published. (medium agreement, limited evidence) Policies that provide a real or implicit price of carbon could create incentives for producers and consumers to significantly invest in lowGHG products, technologies and processes. Such policies could include economic instruments, government funding and regulation. (high agreement, much evidence) How can emissions be reduced? (IPCC) Sector (Selected) Key mitigation technologies and practices currently commercially available. Buildings Efficient lighting; efficient appliances and air conditioning; improved insulation ; solar heating and cooling; alternatives for fluorinated gases in insulation and appliances Transport More fuel efficient vehicles; hybrid vehicles; biofuels; modal shifts from road transport to rail and public transport systems; cycling, walking; land-use planning Energy Supply efficiency; fuel switching; nuclear power; renewable (hydropower, solar, wind, geothermal and bioenergy); combined heat and power; early applications of CO2 capture and storage Waste Landfill methane recovery; waste incineration with energy recovery; composting; recycling and waste minimization Forests Afforestation; reforestation; forest management; reduced deforestation; use of forestry products for bioenergy Agriculture Land management to increase soil carbon storage; restoration of degraded lands; improved rice cultivation techniques; improved nitrogen fertilizer application; dedicated energy crops Industry More efficient electrical equipment; heat and power recovery; material recycling; control of non-CO2 gas emissions Wave energy possibilities. Obviously, any mitigation and/or pushback on emissions that humanity undertakes will have an enormous effect on the world economy. However, it is clear that many of the costs of reducing CO2 emissions are actually negative! QuickTime™ and a decompressor are needed to see this picture. Yes, it will cost a lot to deal with climate change after we skim the low-hanging fruit. The IPCC estimates that getting into netpositive-cost territory will end up taking about 3% of world GDP. Of course, our economy depends on oil. In fact, even President Bush admitted that the US was “addicted to oil.” But even oil isn’t our whole problem. Coal fires up our electricity. Coal produces 2.5 times as much CO2 per unit of energy released. Pres. Bush’s idea of using alternative fuels to solve North America’s addiction to oil … What has happened to the price of oil? You’ve heard about the price of a barrel going over $140 last summer, then dropping due to the global economic collapse: 160 Nominal World Oil Price (Dollars) 140 120 100 80 60 40 20 0 03020131Jan-97 Jan-98 Jan-99 Dec99 29Dec00 28Dec01 27Dec02 Date 26Dec03 24Dec04 23Dec05 22Dec06 21Dec07 19Dec08 Inflation-adjusted oil price (2000 $): It’s returned to 2005 levels now. $120.00 $80.00 $60.00 $40.00 $20.00 1/3/09 1/3/08 1/3/07 1/3/06 1/3/05 1/3/04 1/3/03 1/3/02 1/3/01 1/3/00 1/3/99 1/3/98 $0.00 1/3/97 World Oil Price (2000 Dollars) $100.00 Hmm … Per capita energy consumption Canada and the US are far out front. Who uses petroleum? Chinese traffic jam (Xiamen, south China) Per capita auto ownership You can see that transportation is a big emitter of CO2. What’s happening there in the various countries? The US has 250,851,833 registered vehicles. About 8 M are sold each year. Canada has 27,577,524 registered vehicles. About 1.7 M are sold each year. Europe has about 170 million vehicles. About 3 M are sold each year. China has about 120 million private vehicles. It had just 2.9 million in 1996. About 11 M are now being sold every year. India has about 10 million vehicles. About 1 M are now being sold each year. Biggest petroleum increases since 1960, 2000 Table 11.10, 2007 Annual Energy Review factor inc. since 1960 Canada France Germany Italy Japan Mexico South Korea Spain United Kingdom United States Total OECD Brazil China India Russia Total Non- OECD World 1.69 2.50 3.22 2.93 6.82 5.67 216.00 14.90 0.95 1.11 2.13 7.22 41.35 15.06 5.35 2.97 factor inc. since 2000 0.11 -0.02 -0.04 -0.06 -0.06 -0.02 0.01 0.11 0.04 0.05 0.03 0.02 0.50 0.21 0.09 0.23 0.10 Per capita oil consumption Canada and the US lead the pack Who uses natural gas? Clearly, the per capita results are skewed differently from the net consumption. Canada and the US are again among the greatest users per capita. Electricity is responsible for CO2 as well. Electricity What do we see here? The Unites States is a “big gorilla,” but China and India are growing rapidly in energy use, including petroleum. Canada has an outsize effect as well. Where will the most growth take place (after the economic crisis abates)? In those very regions where the use currently is lowest. Consumers over 5 MWh/person/yr Consumers under 5 MWh/person/yr The average Canadian now uses 37% more electricity than the average American. We can see that an average American uses over ten times as much electricity as an average Chinese. What will happen when the average Chinese electricity use reaches that of the average American? What will happen when the average Chinese family has as many cars as the average American family? We can also see that the average American uses over 25 times as much electricity as the average Indian. What will happen when the average Indian electricity use reaches that of the average American? What will happen when the average Indian family has as many cars as the average American family? This is a serious problem … The US currently “consumes” a whopping 99.54 EJ/yr. Let’s see how much energy China would “consume” at the US per capita rate: 99.54 EJ/yr x 1,321,851,888/304,601,492 = 414 EJ (currently, 64 EJ, an increase of 350 EJ—5.5 times as much as now). Now, do the same for India: 99.54 EJ/yr x 1,129,866,154/304,601,492 = 354 EJ (currently, 15 EJ, an increase of 340 EJ—about 23 times as much). More electricity probably means more coal generating plants. More coal means more coal mining. Which of the following countries has more than a thousand coal mine fires currently burning? a. b. c. d. China India Indonesia The United States The real answer (not listed): All of the above. China, India, and the US probably have about 6000 fires apiece burning. Indonesia probably has only about 3000. Bringing just these two countries to the US standard would involve generating seven times as much energy as the US does currently. Given that these countries are mainly burning coal for electricity, that means that these two countries alone would emit something like seven times as much greenhouse gas as the US currently does, or worse. In 2006, the US emitted about 6 Gt of CO2. China emitted 5.3 Gt; India emitted 1.2 Gt. Last year, China surpassed the US as the world’s greatest greenhouse gas emitter. Let’s do some simple arithmetic … If China gets to US standards with current technology, it will emit 5.5 times as much greenhouse gas as now every year--or ~ 29 Gt. India will emit 22.7 times as much greenhouse gas as now each year--or ~ 27 Gt. The increase from these two is an additional 24 Gt + 26 Gt = 50 Gt of CO2. Carbon dioxide emissions Carbon dioxide emissions So, in these immortal words (of James Lovell, for those of you old enough to remember Apollo 13, or to have seen the film): “Houston, we have a problem.” After 1973 we had a national 55 mi/h speed limit. We also had lines at gas stations, and stations ran out of gas. Business as usual is unacceptable. I haven’t even mentioned peak oil in this talk, which will (when it is recognized to have happened) have a profound impact on everyone. The importance of a “price of carbon” Policies that provide a real or implicit price of carbon could create incentives for producers and consumers to significantly invest in low-GHG products, technologies and processes. Such policies could include economic instruments, government funding and regulation For stabilisation at around 550 ppm CO2eq carbon prices should reach 2080 US$/tCO2eq by 2030 (5-65 if “induced technological change” happens) At these carbon prices large shifts of investments into low carbon technologies can be expected We need to advance renewable energy development, reduce power plant and automotive emissions substantially, and develop energy technology. It’s for our children’s sake. The importance of technology policies Deployment of low-GHG emission technologies and RD&D would be required for achieving stabilization targets and cost reduction. The lower the stabilization levels, especially those of 550 ppm CO2-eq or lower, the greater the need for more efficient RD&D efforts and investment in new technologies during the next few decades. Government support through financial contributions, tax credits, standard setting and market creation is important for effective technology development, innovation and deployment. Government funding for most energy research programs has been flat or declining for nearly two decades (even after the UNFCCC came into force); now about half of 1980 level. “We are at war with the Earth and as in a blitzkrieg, events proceed faster than we can respond.” — James Lovelock, originator of the Gaia idea (that the planet behaves as an organism), in a lecture to the Royal Society, 30 October 2007 Change is coming ... Can we ameliorate or adapt? In his Royal Society speech, Lovelock also said: “We are not merely a disease; we are through our intelligence and communication the planetary equivalent of a nervous system. We should be the heart and mind of the Earth, not its malady.” What sort of future do we want for our children? It’s up to us. We can pay the price needed to continue to live on our wonderful planet, or we can bury our collective heads in the sand (like Mr. Kessler). QuickTime™ and a decompressor are needed to see this picture.