Mark P. Mills

Mills McCarthy & Associates, Inc.

Greening Earth Society Science Advisor

Senior Fellow -- Competitive Enterprise Institute

For

Greening Earth Society

Overview

Buckle your SUV’s seatbelts! This year’s EarthDay 2000 will be the thirtieth celebration of the global envirofest. The environmental community plans and hopes for a stellar media event. The central theme of EarthDay 2000 is:

Using the sun, wind, and other renewable sources to generate energy, we can end dependence on fossil fuels.(1)

Despite Leonardo DiCaprio’s fresh new face on the event, it’s an old, familiar refrain. But with renewable energy programs languishing in policy backwaters for years, the global warming issue has breathed new life into the anti-fossil fuel agenda. The renewable energy theme is anchored in a simple, seductive proposition: Mother Nature provides free energy, in impressive amounts.

Environmentalists are absolutely certain of this. The sun shines. Rivers flow. Wind blows. Trees grow. All are from Nature in stunning quantities. Ten thousand times more solar energy arrives at the surface of Spaceship Earth than current global fuel usage requires.(2)

Because energy is fundamental to people, civilization and life itself, the energy issue deservedly occupies center stage in policy debate. Most discussions and policy proposals to provide energy for the nations of the world focus on economic and engineering realities. Correctly so. After all, if an energy delivery system doesn’t work well – or if it is too expensive – it is (or should be) irrelevant.

Sad to say, the economic and engineering realities of the past twenty years have rendered a verdict of "irrelevant" on the environmentalists’ favored renewable energy sources. Twenty years after the first confident predictions(3) that renewables would capture fifty percent of the nation’s energy supply by the benchmark date we just passed – Y2K – the United States of America derives less than one percent of all energy from the enviro-favored renewables.(4)

But, EarthDay 2000’s spinmeisters still sing the old refrain burnished to reflect the technological optimism of the Digital economy:

The long-term solution is to move on from fossil fuels to smarter alternatives, just as we advanced from the typewriter to the word processor.(5)

Their revised premise is that despite decades of similarly failed promises, the technology is now, finally, on the verge of engineering and economic practicality. An examination of the two-decade-long record of renewable energy promotion reveals a consistent theme. Whether it is true or not, it is grounded in four core and inter-related beliefs. They represent the emotional appeal of Mother Nature’s renewable energy sources.

Renewable energy is abundant.

Renewable energy is natural.

Renewable energy is better.

Renewable energy is free.

These four oft-repeated "facts" concerning renewable energy do not really concern either engineering or economics. They are more about the reality of what nature has to offer. And they provide the impetus for federal funding.

The economic and engineering realities of renewable energy sources have been exhaustively detailed in many venues.(6) Yet, despite a twenty-year intellectual and market force drubbing, renewable energy’s appeal continues. Not surprisingly, a survey of registered voters asked to give a ranking to federal energy funding priorities garnered thirty-two percent for renewables and eight percent for fossil fuels.(7) The appeal of renewables continues at least in significant part because of the above-listed four tenets of the enviro/energy belief system.

Since these core beliefs about renewable energy derive from a perception about the nature of Mother Nature (and thus the laws of physics), it is understandable that one might believe that, given enough time, engineers might unleash renewable energy’s inherent and pent-up advantages. Such avowals of faith support the now popular proposition that using fossil fuels constitutes a bridge to renewables’ Promised Land. Renewables’ perceived advantages provide the intellectual underpinning for proposed government policies intended to shorten the bridge’s span.

The issue is not whether engineers can make renewable sources work. We already know they can and that they do. The central issue is whether there is something different – something truly special – about renewable energy sources. To answer to this question, one needs look not to engineering and economics, but to something more basic: the physics of energy.

Renewable energy is abundant.

True, but irrelevant.

Energy in nature is unlimited. That’s a simple physical reality. But, for all practical purposes, energy in all forms – whether renewable or fossil – is unlimited. There is no difference in the magnitude of the basic fossil and renewable resources at any scale that matters to humans.

Renewable energy is natural.

All energy resources are natural.

Coal, oil, natural gas, and uranium are no less natural than are the sun, trees or water. All of the energy resources upon which we rely are natural.

Renewable energy is better.

All energy resources are not equal.

Those that are most useful invariably are the most concentrated, most flexible, and the most readily stored and moved. Renewable energy sources require conversion from their largely useless "natural" form into something more useful, like electricity. While this is also true of fossil fuels, renewable energy resource use requires vastly more intensive land-use than do fossil fuels. Using renewable energy on a mass scale will increase total land-use for energy by factors that will cause concern for urban sprawl to pale in comparison.

Renewable energy is free.

There is one Law of Physics that is so basic and so sacrosanct that it has been rendered a cliché: There is no free lunch. This is no less true for energy.

To be sure, abundant radiant energy from the sun arrives on earth’s surface at no cost. But, likewise, there is no inherent cost in the rich veins of coal that make the U.S. "the Saudi Arabia of coal." Nor is there any cost associated with the abundant deposits of oil and natural gas with which we are blessed. In this way, all energy is free.

Energy’s cost comes with its conversion into useful work. In short, it costs energy to convert energy resources into useful work – such as moving a car, melting metal, or powering a computer.

Renewable energy is abundant.

This litany concerning the abundance of renewable energy is standard fare in environmental promotion. It goes something like this:

Compared to the world’s annual consumption of fossil fuels

Global biomass growth is 7 times greater (this includes everything from the grasses on the High Plains, to the trees in National Parks, to the weeds in your lawn).(8)

Energy in the waves of the ocean is at least 1000 times greater.

These are impressive facts, but they are largely irrelevant.

Mother Earth also holds, at last count (and the count keeps growing with the passage of time and continued exploration and discovery), abundant natural fossil fuel resources. So we can also say something like this:

Compared with worldwide annual fossil fuel consumption, earth has

700 times more energy in the form of coal.(9)

500 times more energy in heavy oil resources.

2000 times more energy in natural gas locked in deep ocean methane hydrates.(10)

Environmentalists don’t tout fossil fuels’ natural abundance as an opportunity. They see it as a problem. In reality, the enormous scale of natural energy sources is so vast that the issue of whether it is renewable or not is irrelevant.(11) The concern for human exhaustion of fossil fuel resources is properly couched in terms of centuries. Planning for conditions several hundred years from now surely should be irrelevant for today’s policymakers.

The extent to which a resource is useful depends on a number of natural factors. Diffuse, low-density energy sources, such as sunlight and oil sands are hard to collect and difficult to concentrate. Geography also is a limiting factor. The methane hydrates along the ocean floor or wind on remote mountain peaks can not be considered to be conveniently located. Then there is the central reality that all resources require similar basic technologies. It doesn’t matter whether it is silicon and steel for photovoltaics or for oil platforms. Such factors are common to all energy resources.

Therefore, the central belief that renewable energy resources possess some special advantage in terms of abundance when compared with fossil fuel resources is simply false.

Let’s add an important note about hydrogen as an energy resource.

Get into a debate with an environmentalist about our energy future and you are going to be lectured about hydrogen. Hydrogen has long been a favored fuel in popular environmental writing. All other resources simply are considered to be part of the bridge to our "hydrogen future."

Journalists and forecasters often wax near poetic concerning the inevitability of the hydrogen economy. But all to often they omit consideration of the answer the question of whether the hydrogen resource will be found.

Of course hydrogen is the most common element in the universe. But there’s this problem: Virtually all of the hydrogen in this solar system inconveniently is located in the Sun and Jupiter.

Here on Earth, virtually all of the hydrogen that is today produced comes from reforming coal or natural gas, where it resides bound up with carbon – hence the term hydrocarbon fuels.(12) The remainder of earth’s useful hydrogen is bound up with oxygen in the form of water (H₂O). Hydrogen can be released from water by electrolysis using electricity. In all, hydrogen is no more an energy resource than is electricity; rather it is in effect an energy product that can be produced from a resource.

Renewable energy is natural.

All energy sources are natural. The coal, oil and natural gas below the surface of the earth are as natural as the sunlight that strikes earth’s surface, the trees that grow on it, and water that runs across it. Fossil fuels are the product of the long and natural conversion of plants and animals that have been concentrated and converted into a useful form over millennia.(13)

It is no more or less natural to use steel and silicon to fabricate and operate a windmill than it is a coal-fired power plant. The chemical energy released from fossil fuel combustion is no less natural than is the kinetic energy from wind, water, and waves. Chemical oxidation of carbon is the central energy process of life on earth. Even though the electricity at someone’s home, office or factory comes from machines, electricity too is a ubiquitous and natural form of energy. Electricity powers everything from human and animal brains to tropical storms.

Both renewable and fossil energy sources must be converted from their natural state into a useful form to heat or chill air, water, food and other things, or to set in motion vehicles and machines.

Neither crude oil, trees, sunlight, waves, nor wind are worth a lot for transportation, in energy terms, unless they can be converted into portable, high purity, high-density fuel. In everything other than transportation, electricity is the preferred form for delivering energy to modern civilization’s machines and devices.

Electricity constitutes the fastest growing form of energy in use today – accounting for all non-transportation energy growth in the U.S. during the prior, Internet-dominated decade. Non-transportation and non-electric energy use declined eight percent, while electricity use rose twenty percent in the past decade.(14)

It is no easier to power a computer or TV in rural India using "natural" dung or wood than it is to use "natural" wind or sun in Manhattan for the same purposes, or "natural" coal in Wyoming or West Virginia, for that matter. The primary natural resource must be converted into an unnatural one: the kilowatt-hour.

Transforming basic natural resources into electricity arguably is one of the most important engineering feats in all human history.

Renewable energy is better.

While it is true that not all energy sources are equal, it is likewise true that the most useful forms of energy are invariably those that are the most concentrated, the most flexible, and the most readily stored and moved. On that basis, renewable sources are not better; they frequently are worse, for reasons anchored in other natural realities.

Wind, water, trees and even sunlight often aren’t where you need them, when you need them, nor in a form you can readily use them. On this basis, they really are no different than oil, coal or natural gas. The essential difference shows up when considering the realities of getting the natural resource from where it occurs to where it is needed. The problem with renewable resources is that they are, on average, much harder to collect, transport and store. In short, they’re worse than – not better than – fossil fuel resources.

On the other hand, in the case of fossil fuels, Mother Nature has already conveniently concentrated energy into forms that are remarkably easy to use.

The parts of the U.S. – or the world, for that matter – that have the most useful concentrations of wind, daily sunlight or plant growth typically are located a great distance from where most people live and where the energy is needed.

Consider electricity. Renewable resources at remove from population and demand necessitate greater dependence on long distance electric transmission than would be required for conventional power sources that can be fabricated more proximate to population and demand.

Of course biomass can be transported in the same ways as can coal or oil. But two things work against transporting biomass great distances. First, it’s harder to collect and it is more diffuse. Second, once it is collected, it weighs more and thus costs more to transport per unit of energy yield.

On average, biomass (wood, grains, plants, etc.) weighs three to fifteen times more than oil or coal per unit of energy.(15) Thus while a barrel of oil weighs about 330 pounds, you would need to transport 1000 pounds of dry wood to release the same energy – and twice that much if the wood is slightly wet.

To get around this problem, the biomass often is converted into its "finished" or desired form of energy at or near the point of resource supply. A biomass-based methanol facility, for example, or a biomass-fueled power plant that generates electricity can use trucks or power lines, respectively, to deliver the energy product to market. And, of course, electricity generated from wind and solar energy can be carried via transmission lines, too.

Similar solutions are often used for mine-mouth coal-fired power plants (especially for lower-ranked coals), for hydroelectric dams and so on. These are not unique energy sources. In this way they are no better nor any worse than renewable resources – that is until the second fatal disadvantage to renewable energy resources is factored into the equation. By "fatal" I mean only in terms of renewable energy capturing a primary share of the energy marketplace.

That fatal flaw_ On average, renewable energy is worse than fossil fuels because renewable energy is a very diffuse resource. Every form of renewable energy is characterized by a small amount of energy available per unit of land area in comparison with fossil fuels.

The "energy density" of growing biomass (crops) is about 0.1 watt/square meter.(16) The energy density of a coalmine or oil field is typically 10,000 times greater.(17) The lower energy density for renewable resources means that a lot more land – and all of the associated costs and impacts more land implies – is needed to yield the same amount of energy output.

Traditionally, an energy resource’s land use requirement has been the single most important environmental metric. While many other issues are relevant to environmental protection, the amount of land needed is a first order measure of humans’ footprint on the earth. While environmentalists feel no inhibition in attacking cities and suburbs for sprawling land use, they are remarkably silent when considering the land use implications of their preferred energy agenda. A national energy policy rooted primarily in use of renewable resources would increase dramatically the amount of land humans develop and impact.

Using primary energy sources with greater inherent energy density reduces the amount of materials, land, transportation and conversion facilities humans require for the same energy yield – all of which serves to reduce civilization’s environmental footprint. While the EarthDay 2000 PR campaign calls renewables "The 21^st century energy," using the sun, plants, water, and wind to make most of our energy in fact would be a regression to the 18^th century. Fossil fuel use came along in the 19^th Century to supplant them.

Here is a handy conversion factor to use in calculating the Increased land use required to yield the same amount of the electricity:(18)

Renewable energy is free.

Sunshine knows no boundaries! It's the toll-free, tax-free, energy source"(19)

This surely is the silliest among the four renewable resource tenets. Yet it is the most widely and oft-repeated. It is a notion that bumps headlong into the Laws of Physics – especially the principle of "no free lunch."

Oh, of course there is no inherent cost in the fact there is abundant sunlight in Nevada, wind blowing in the Dakotas, water rushing to sea, or trees growing in the Pacific Northwest. But then, similarly, there is no inherent cost in the abundantly rich veins of coal underlying the Powder River Basin in Montana and Wyoming, or the abundant deposits of oil and natural gas in the Gulf of Mexico. In this way all energy resources are free. Making an energy resource useful – now that’s another matter.

Putting energy resources to use entails an energy cost (not to mention an economic cost) associated with all of the activities and technologies required to convert the resource into useful work. In physics, energy is literally defined as "the potential to do work." Whether one thinks in terms of physical or human systems, potential literally is just a beginning.

Energy (and materials) are always required to capture energy, convert it into a useful form, and transport it to where it is needed. Engineers design and build machines to harvest, convert, and use the energy inherent in all resources. Every step in the conversion process expends energy, including the energy needed to make the materials themselves.

It doesn’t matter whether it is human energy (such as women in the Sudan ranging far and wide in search of firewood), animal energy pulling a cart or plow elsewhere in the Third World, chemical energy converting oil into gasoline, or chemical combined with mechanical energy transforming coal into electricity.

By way of example, it takes twenty percent more energy to harvest wood than it does to mine coal in terms the energy yield from the unit of fuel collected. It takes ten times more energy to transport wood than it does coal with the same energy content. It requires fifty percent more energy to convert wood into electricity than it does to convert coal.

The reasons that there is a higher energy investment at each and every stage of accessing wood energy compared with the energy from coal are immutable. Coal as an energy resource is more concentrated. Wood contains more water, thereby increasing its cost of transportation while reducing its combustion efficiency. Overall, to extract an equal amount of useful energy (electricity), requires a substantially greater energy investment for wood than for coal.(20) And, unfortunately for renewable resources, this is not the end of the net energy considerations.

To determine the energy investment required to build and operate any energy delivery system, one must account not only for the activities and conversions in each step of the process, but must also account for the energy required to fabricate the necessary materials and hardware. By way of example, this would include the energy necessary to make concrete for hydroelectric dams or the steel used in the machines manufactured by Caterpillar® , Komatsu® and Joy® to dig coal out of the ground. It would include the silicon in photovoltaic cells. All of these materials contain an energy investment.

Sometimes their inherent energy cost is remarkably high (as is the case for aluminum or silicon). Sometimes very large quantities of relatively low-energy material are required (like concrete for hydroelectric dams). By way of example:

A ton of cement requires one barrel-of-oil-equivalent (BOE) in energy

A ton of steel, 6 BOE

A ton of silicon, 40 BOE.

In some cases, the energy invested in constructing an energy extracting system comprises most, if not all of its energy "debt." This is particularly true for hydroelectric dams and most renewable energy systems. In analyzing the net energy for solar-power satellites (an idea resurrected after a two-decade dormancy(21)), researchers found that the energy required to make silicon solar cells was substantially greater than the energy needed to launch the arrays into earth’s orbit.(22)

There are staggering implications associated with the energy investment, and the resource and chemical requirements of a major photovoltaic industry. The photovoltaic (PV) cell is the poster child of renewable energy.(23) Those PV silicon wafers today provide 0.02% of the nation’s electricity. Renewable energy advocates are right: there is a lot of room for growth from a less than one percent base in the nation’s energy mix. But growth to a level where PVs supply a significant amount of the U.S. electricity would clearly catapult the silicon PV industry beyond the size of the current silicon-based semiconductor industry. We would witness the creation of giant PV fabrication plants across the land. Two things would be noteworthy in that regard. And the professional environmental community’s reaction to such an outcome likewise would be entirely predictable.

So that the reader can understand, today’s semiconductor industry comprises the single largest segment of the nation’s manufacturing sector. Semiconductor manufacture surpassed the second-largest sector – motor vehicle parts and accessories manufacturing – in 1994.

Environmental organizations have begun to target the chemical and industrial hazards associated with the use of chemicals and energy at the semiconductor manufacturing plants.(24) Their studies are attracting media attention because of the problems pertaining to landfills and the hazards associated with the enormous scale of the personal computer (PC) industry.(25)

For PVs to make a significant contribution, the silicon-energy industry would need to expand a thousand fold.

Second, in addition to the kinds of chemical and industrial hazards this could be anticipated to present from an environmental perspective, such an expansion would increase the nation’s energy appetite because of the very high "net" energy cost of the solar path.

No matter where one ranges along the energy food chain, materials, fuel, and equipment are required to access energy resources and to convert them into something useful – whether it be heat, light, motion or food. An entire field of research has emerged from understanding of this reality and seeks to determine the net energy yield of various energy sources and systems.(26) Clearly, a primary energy resource that requires more energy to tap than it can yield is a "loser."

As it happens, research shows that most energy resources can be tapped and produce a positive overall net energy yield, i.e., more useful energy delivered than was invested in the materials and processes used to tap the resource and deliver fuels or power.(27) While "net energy yield" provides useful information, it does not necessarily indicate which resources are practical or economic.

The net energy yield of an offshore oil rig in the Gulf of Mexico is roughly comparable to the net energy yield of oil shale processing. The former is a major source of new oil and the latter still irrelevant. Engineering and economic factors determine costs. And they are driven only in part by the energy investment. Nonetheless, let’s compare the net energy yield of various electricity supply systems.

The following table shows the ratio of the estimated thirty-year total energy produced by each energy system as a share of the energy invested in fabricating and operating the system. This "net energy ratio" can be expressed in familiar financial terms (as an annual percentage return on investment or ROI, for example). In this depiction the "initial investment" is in the form of energy. An investment of 100 units of energy to make and operate a PV electric system yields an average annual Return on Energy Invested (ROEI) of 7.59% per year. This rate, over thirty years, returns a total of 900 units of energy from the 100 invested. By comparison, the ROEI for a conventional coal-fired power plant is 9.68%/yr. This higher rate over the thirty-year operating life yields a total return of 1600 units of energy for the 100 invested.

From a purely energy investment perspective (which does not account for economics, or practicality like location, or environmental issues (such as land use), a large hydroelectric dam is the clear winner. But choosing solar power over coal, for example, is a clear loser in terms of ROEI. The investment entails greater immediate energy and a less annual payback.

Return on Energy Investment (ROEI) for electric supply sources(28)

Exploring the physical realities of energy systems leads to an inevitable conclusion that renewable sources offer nothing that is inherently unique or special. The energy marketplace’s choice of fuel resources will (and should) be determined primarily by practical and economic considerations, especially as more competition is brought into play. There is no basis for the notion (whether it is implied or is made explicit) that renewable energy resources are in any way more "natural" than any other. That to some people’s mind’s eyes they have more aesthetic appeal is really beside the point.

It was not the intention of this report to cause the reader to conclude that wind power and solar energy do not have a role and, in all likelihood, a growing niche in the energy mix. Rather, we hope the reader can now appreciate the fact that physical reality confers no special advantage to renewable energy resources. Mother Nature plays no favorites in that regard, placing more restrictions than advantages on "natural" renewable energy. Pursuit of renewable energy based on sound economics and physical reality is rational; anticipating that the Laws of Nature will be suspended in the interest of political correctness is not.

We cannot help but close with this final thought when it comes to the idyll of windmills and solar arrays powering the Information Age as proposed by EarthDay 2000’s organizers …

The scale and scope of an effort to gather the diffuse renewable energy necessary to meet the enormous and expanding electricity appetite of the Internet economy would be comparable to using Compaq’s new self-powered PC keyboard to energize your house. It is do-able in theory. It simply would be silly to do in practice (forget the economics)!

Compaq introduced a wireless PC keyboard that can recharge an internal battery using the kinetic (and renewable) energy of your fingers typing on the keyboard. A team of 500,000 keyboard operators, typing round the clock in eight-hour shifts at forty words-per-minute would be required to power the average house.(29) Can anyone seriously believe and advocate that the scale and demands of our modern, electricity-dominated, Information Age economy similarly rely on windmills and PVs to realize this kind of gee-whiz notion of what might be a neat thing to do?