A SENSIBLE ENERGY STRATEGY

Today, there is little doubt that energy systems the world depends on are changing the earth's climate - and with it many of the natural systems on which humanity depends. Food production, water supplies, forest products industries and fisheries are all at risk if global warming continues to accelerate. The huge quantities of oil, coal and natural gas that fuelled the modern age may well lead to its decline.

There are no quick fixes to this problem. Avoiding destructive climate change will require a fundamental reordering of national energy priorities within the next decade. Carbon dioxide (CO2) accounts for about half of the global warming now occurring. Producing less CO2 requires using less fossil fuels, which means that other energy sources must be found to run the global economy.

Unfortunately, the challenge of making global warming a central concern of national energy policies is far from being realized. Energy policy-making is often driven by self-interested industries and unions, and some, such as the oil and coal lobbies, push for policies that will accelerate global warming. In Congress, key legislative committees are dominated by members from states that produce fossil fuels; many of the laws and tax breaks that emerge are intended to propel their growth. In Eastern Europe, ossified energy ministries continue to emphasize meeting their five-year plans, regardless of the ecological costs.

The tendency is simply to add global warming to a long list of considerations that go into making energy policy. This is not enough. If energy policy-making continues to be the domain of short-term thinking and narrow political considerations, there can be little hope. If the climate is to be stabilized, it must become the cornerstone of national energy policies.

There are essentially three ways to displace fossil fuels: improving energy efficiency, thereby accomplishing the same tasks using less oil and coal; developing renewable sources of energy; and expanding the use of nuclear power. But the only safe and cost-effective way to slow global warming is the simultaneous pursuit of renewables and efficiency--and the abandonment of the nuclear power "option." Meanwhile, natural gas has an important role as a transition fuel since it produces less carbon per unit of energy than do the other fossil fuels.

The problem with nuclear power is that over the past 40 years it has absorbed the vast preponderance of government energy investments and diverted political attention from the real choices at hand. Nuclear power currently provides about 15 percent of the world's electricity, and could, in theory, be used to replace coal-fired power plants and reduce carbon emissions. But it is not a practical response. Since its troubled start, nuclear power has been a problem-ridden technology; unlike renewable energy, its problems are growing. It has become increasingly expensive and accident-prone in the past decade. And the critical problem of disposing of radioactive wastes has yet to be solved.

To replace all coal-fired power plants with nuclear ones by 2025 would require building a minimum of one plant every two and a half days for the next 30 years. The world would have 18 times as many nuclear plants as it does today, and the rate of climate change would have been slowed, but only by 20 to 30 percent. Nuclear power could of course be pursued as one of a long list of options, but it is poorly suited for this. Even on a limited scale, this energy source requires vast financial resources and technical skills, limiting the development of other options. As nuclear construction, operating and decommissioning costs have grown, nuclear power has become a prohibitively expensive way of providing electricity or displacing carbon dioxide. Throughout most of North America, Western Europe and even the Soviet Union, people are rejecting the expansion of nuclear power. Unless the technology is completely revamped and there is a complete turnabout in public attitudes, both of which are increasingly implausible, the necessary scale of expansion is impossible.

Improved energy efficiency can have a much larger and more immediate impact on carbon emissions and global warming. For example, the efficiency of U.S. buildings, industry and transportation improved 25 percent between 1973 and 1986; this kept carbon emissions at 1.2 billion tons per year. Without these measures, carbon emissions would have reached 1.5 billion tons annually. Another 300 million tons of carbon were avoided by efficiency improvements in other countries. Similar gains are possible in the future using already available technologies.

Shifting to more fuel-efficient transportation can sharply reduce carbon emissions. The world's nearly 400 million cars currently spew 547 million tons of carbon into the atmosphere each year,10 percent of the total for fossil fuels. Projections based on recent trends would have these emissions nearly doubling by 2010. However, if a combination of improved mass transit, greater use of bicycles for short trips, and a carbon tax kept the world fleet to 500 million cars in the year 2010, and if these vehicles averaged 50 miles to the gallon rather than the current 20, automobile carbon emissions would fall to 273 million tons, half of what they are today. (Already prototype cars have been developed that get over 70 miles per gallon.)

Carbon emissions can also be lowered by improving the efficiency of electricity-using devices. Currently, 64 percent of the world's electricity is produced from fossil fuels (chiefly coal). This accounts for 28 percent of the 1.5 billion tons of global carbon emissions coming from fossil fuels. Electricity is used in many different ways, all of which can become far more efficient . More efficient lighting systems have a particularly large potential. Worldwide, lighting accounts for about 17 percent of electricity use or 250 million tons of annual carbon emissions. These emissions continue to grow rapidly as electric lighting is used more widely in developing countries. If the world were to double the efficiency of these systems by the year 2010, it could cut a projected 450 million tons of carbon emissions from lighting in half, to 225 million tons. For common household use, compact fluorescent bulbs using 18 watts of electricity can already provide the same illumination as incandescent bulbs that use 75 watts. Using existing technology, improved bulbs and ballasts can cut the electricity use of commercial buildings' lighting by 75 percent.

Cogeneration, the combined production of hear and power, also has enormous potential to improve the efficiency with which electricity is generated. This technology, already extensively used in some countries, allows the inevitable waste heat from electricity generation to be used directly by buildings or industry or for further electricity generation in a combined cycle system.

Switching from a conventional 1,000-megawatt coal-fired power station to a combined cycle system allows a 30 percent improvement in efficiency and a commensurate cut in carbon emissions of 800,000 tons per year. Switching to a natural gas- fired, steam-injected turbine, however, permits a 70 percent cut in carbon emissions. For the world as a whole, improving the average efficiency of today's 1 million megawatts of coal-fired capacity by 30 percent could cut carbon emissions by 312 million tons.

Overall, energy efficiency improvements worldwide between 1990 and 2010 could make a 3 billion ton difference in the annual amount of carbon released to the atmosphere. (About 5.5 billion tons were emitted through fossil fuel use in 1988; that will increase to as much as 10 billion tons in 2010 if it grows at just 3 percent annually.) A study by Irving Mintzer of the World Resources Institute suggests that a reduction in emissions of this magnitude could make a difference of 0.5 to 1.5 degrees Celsius in the global average temperature by 2075. There is simply no other approach that offers as large an opportunity for limiting carbon emissions as energy efficiency does.

Renewable Energy

Renewable sources of energy do not have nearly as large a potential to displace fossil fuels in the years immediately ahead as energy efficiency improvements do. That potential will grow, however, as the technologies are improved. The outlines of a successful strategy already exist. Solar, hydro, wind, and geothermal power have been pursued with notable successes by governments and private companies since the mid-seventies. Across a broad spectrum of technologies, costs have fallen steadily and performance has improved. If renewable sources are to supply a large share of the world's energy by the middle of the next century, they must be vigorously developed today.

Hydropower supplies about 21 percent of the electricity produced worldwide, displacing 539 million tons of carbon that would otherwise be emitted each year. Solar collectors are a major source of hot water in Israel, wind power has taken hold in California and geothermal energy is a major electricity source in the Philippines.

Solar photovoltaic cells, which in the last decade have dropped in price by 90 percent, are already being widely used on remote communications systems and portable electronic devices. As costs fall further in the next decade, photovoltaics will become an economical electricity source for Third World villages and large power grids everywhere. The world now has approximately 2,000 megawatts of wind power in place, which produces about 2 billion kilowatt-hours of electricity, displacing 540,000 tons of carbon annually. If wind power and photovoltaic electricity development were accelerated greatly, reaching 150,000 megawatts in the year 2010, they could displace 71 million tons of carbon emissions a year.

If policymakers do not grasp the link between energy efficiency, renewable energy and global warming, climate stabilization will not be possible. Although governments have supported these technologies for over a decade, their commitment has wavered. This is particularly true in the United States, where research and development budgets for renewables and efficiency soared in the late 1970s and then were each cut by four-fifths between 1981 and 1988, slowing the reduction in carbon output. The U.S. Department of Transportation's recent decision to lower fuel economy standards for automobiles and light trucks will exacerbate global warming, as will the choice of Chinese officials to emphasize extensive coal mining rather than efficiency.

A serious and lasting government commitment to the development and use of energy-efficient and renewable technologies is a prerequisite to stabilizing world climate. So too are individual decisions about the kind of refrigerator to buy, the amount of home insulation to install and how much to drive a car.

For policymakers, the essential challenge today is to improve energy efficiency in a period of low energy prices. The costs of climate change and other environmental effects of fossil fuels can be reflected in the prices consumers pay by raising taxes on gasoline and other carbon-based fuels. The United States, for example, could raise $100 billion annually by hiking its gasoline taxes by $1 per gallon to the European average tax of about $1.50 per gallon. Alternatively, governments could levy a "carbon tax" on fossil fuels, with the tax corresponding to the amount of carbon in each fuel. This would hit coal hard, since it produces more carbon per unit of energy used than do either oil or natural gas. Energy prices would rise and efficiency would improve. Renewable energy sources would become more competitive.

Ideally, such taxes should be agreed on internationally so that the additional costs would not hit some economies disproportionately. The revenues could be used in part to offset other taxes and in part to develop permanent and stable funding for energy efficiency and renewable energy programs. If the governments of the industrialized countries devoted 10 percent of the revenues of such a tax to energy efficiency, renewable energy development and reforestation in the Third World, it would encourage a broad based assault on the problem of climate change.

Large-scale investments in energy-efficient buildings can also help stabilize the climate. Governments can provide building owners with technical assistance and utility companies can invest in improved building efficiency rather than new plants. These investments can be essentially self-financing via a revolving fund since they pay for themselves in lowered fuel bills.

Fuel efficiency standards for automobiles, appliances and other energy-using devices are another proven way to reduce fossil fuel use. U.S. appliance efficiency standards already enacted will cumulatively displace over 300 million tons of carbon by the year 2000. The broad international market for technologies and the common interest in climate stabilization argue for international efficiency standards for automobiles, trucks, lighting systems, appliances and electric motors. For example, reaching a minimum new car fuel efficiency standard of 50 miles per gallon by the year 2000 and 60 miles per gallon by 2010 would be an important step toward restoring climate stability.

To slow global warming significantly, hundreds of billions of dollars of investments in improved energy efficiency will ultimately be required. Although it might seem that in a debt- swamped world such levels are impossible, many energy efficiency options are inherently cost-effective. Companies and individuals ultimately save money via reduced fuel bills, and more energy- efficient economies tend to be more competitive in world markets. The role of government is to set the framework that allows these kinds of cost-effective investments to proliferate.

In other areas, government has a more direct role to play. It would, for example, make sense for the international community to devise a program to use photovoltaics rather than coal to electrify all Third World villages by 2010. The United Nations and the World Bank could thereby spur sustainable development and help slow global warming.

The challenge of raising sufficient funds to invest in efficiency in the Third World is particularly severe. Driven by rapid population growth and expanding economies, carbon emissions there are growing at annual rates as high as 5 percent. China, for example, has plans to more than double its use of coal by sometime after the turn of the century, an "achievement" that could well push it past the United States and the Soviet Union as the world's number one carbon emitter. Already deeply in debt, most developing countries are chronically short of capital needed to finance energy efficiency improvements. One solution is to redirect a portion of the enormous flow of international lending currently devoted to building power plants and electric lines. The World Bank has only just begun to consider loans for improved efficiency.

To redirect world energy trends in the absence of direct market pressures is an unprecedented challenge. Politicians will have to rise above the parochial interests that often motivate them, and companies and individuals will have to focus on the real bottom line, which shows that improved efficiency is both cost- effective and can slow global warming. Action will be facilitated if governments adopt short- and long-term carbon reduction goals along the lines of the 20 percent reduction by 2005 suggested at the 1988 Toronto climate conference. Perhaps more productive would be energy efficiency targets either by sector or for the economy as a whole. In any case, there is a clear need both for early national initiatives and eventual international agreements to reduce carbon emissions from fossil fuels.

Lester R. Brown is President and Christopher Flavin and Sandra Postel Vice Presidents for Research, of the Worldwatch Institute. This article is adapted from The State of the World 1989, published by W.W. Norton & Co.\