37. Energy Transition –The Wright Thing

 Energy Transition –The Wright Thing

As usual, there’s bad news and there’s good news. The bad news is, there is no Moore’s Law for carbon-free energy production. The good news is, there IS a Wright’s Law for carbon-free energy production! A recent study points out that traditional economic models have consistently over-estimated the cost of renewables over time, and that a transition to carbon free energy will happen with a net positive impact on the economy.

Some of our tech-savvy readers may have heard of Moore’s Law. This is a phenomenon in the progress of computer development where the number of transistors on a microchip doubles roughly every two years, thus doubling their computation ability - so the cost to do the same computation gets halved.This law has held true since the late 1960s when it was predicted by Gordon Moore, one of the founders of Intel Corporation. Since then, computing power has doubled about 23 times, a 10 million-fold increase. Your typical smartphone is quite literally millions of times more powerful than the world's largest computers of the late 1960’s. And thousands of times less expensive.

A physics student once asked me if there was something like Moore’s Law for energy. My response then was that there is not. I dug out a book I was given back in 1965, when I was 11, called “Man and Power.”  It described the historical sources of energy and how they had changed over time: It talked about the dramatic shift in energy usage with James Watt’s development of an efficient steam engine and how it drove the industrial revolution. Then there was another shift in the early twentieth century with the internal combustion engine and the electrification of society. 

But in terms of where we get our energy and how efficiently we use it, things did not look dramatically different in 1965 than they do today. Nuclear power did not grow at the rate predicted in the 1950’s. The only significant renewable energy sources then were hydropower and biomass. Today there is wind and solar, but only about 4.5% of our energy comes from these. Yes, the costs of wind and solar are decreasing over time, but nothing so dramatic as Moore’s law.

But now for the GOOD NEWS: There is Wright’s Law.  Applied to developing technologies, this law relates the amount of deployment of a technology to its cost. As deployment increases, the cost per unit decreases. In the case of solar, it turns out that for every doubling of the total amount deployed, there tends to be about a 20% decrease in cost per unit. (This is not to be confused with economy of scale which relates more to the size or scale of an individual project.) So, when solar reaches 40% of our energy its cost will be less than half of what it is now.

A recent paper from The University of Oxford Institute for New Economic Thinking* has used Wright’s law to make predictions on the cost of future deployment of wind and solar. Asserting, with documentation, that traditional economic models have consistently overestimated the cost of renewables over time, they show how Wright’s Law predicts that the cost of wind and solar will continue to decrease exponentially at these rates.

Not only do they predict that these costs will continue to decrease, but that it is possible to transition to a practically carbon free energy world with a positive, NOT a negative, impact on economic growth. In fact we could save 26 trillion dollars over the next 50 years if we shift our investments to these renewables going forward. In other words, we could transition to these renewables purely on economic grounds, even without the threat of climate change. They predict that with a rapid transition to these renewables we could achieve emissions reductions of 80% by 2040, which is well below the goals of the Paris Agreement of 2015.

There are, of course, vested interests that could well hold up such a transition: namely, the fossil fuel industry, which has a powerful lobbying contingent in high places. Policies are needed that put the interests of the planet before those of some corporations. For example, enacting a price on CO2 output and removing subsidies for fossil fuels would go a long way to pushing this transition.  Facilitating electrical transmission infrastructure would definitely help, as society’s understanding of the need for this seems to lag far behind.

Policy makers CAN address these matters, including making certain that the transition is done in a just manner. Potentially disruptive effects of the transition such as the displacement of workers in the fossil fuel industries can and must be addressed, of course. Policy is a matter of political will and intention - there are many ways to help economies around the world to leapfrog over the use of polluting energy directly to renewables as they aspire to raise their standard of living to that of developed countries. We all just need to be on the same page - saving the planet - without conflict of interest.

In short, done properly, this transition will be good for our economy, developing countries’ economies, and everyone’s atmosphere.

*energy_transition_paper-INET-working-paper.pdf (ox.ac.uk)

Paul Stancioff, PhD., is professor emeritus of physics at the University of Maine Farmington who dabbles in energy economics on the side. Cynthia Stancioff pursues climate action and sanity. Their emails are pauls@maine.edu and cynthia.hoeh@gmail.com . Previous columns can be found at https ://paulandcynthiaenergymatters.blogspot.com/.