Green is the new black--from Washington, D.C., to Silicon Valley.
But the lovefest with clean technology still has plenty of detractors who say that it's all just posturing, wishful thinking, or, worse, misguided.
Let's pull together a few threads from Friday morning's river of green tech news and see whether it adds up to anything.
For those of you in a hurry, here's my bottom line: No, America will not "get off oil" anytime soon as President Bush urged us this week, but yes, green tech matters a lot for the economy and the environment.
First, a quick sampling of clean tech news from this week:
At the Washington International Renewable Energy Conference (WIREC) on Wednesday, Bush said America needs to kick its oil habit and touted his administration's commitments to renewable energy.
The speech was applauded by conference promoters but skewered by some environmentalists, including Joseph Romm and his colleagues, who wrote at the Web site Gri that the Bush administration's actions don't match his words.
Several businesspeople from the renewable energy industry who lobbied (again) this week for an extension to an existing tax credit would likely agree that the administration has not done enough to encourage clean tech development.
Then on Friday, The New York Times published a book review of Gusher of Lies, a book by Robert Bryce who argues that people are deluding themselves if they think that the United States can become energy independent:
Energy independence is hogwash. From nearly any standpoint--economic, military, political, or environmental--energy independence makes no sense. Worse yet, the inane obsession with the idea of energy independence is preventing the U.S. from having an honest and effective discussion about the energy challenges it now faces...Once you move past the hype and the overblown rhetoric, there's little or no justification for the push to make America energy-independent. And that's the purpose of this book: to debunk the concept of energy independence and show that none of the alternative or renewable energy sources now being hyped--corn ethanol, cellulosic ethanol, wind power, solar power, coal-to-liquids, and so on--will free America from imported fuels. America's appetite is simply too large and the global market is too sophisticated and too integrated for the U.S. to simply secede.
We saw glimpses of this sort of thinking earlier this week at WIREC.
The CEO of BP, Tony Hayward, on Tuesday told international delegates at WIREC that it's time to face reality on all this clean tech noise.
"But even though 'clean tech' is growing very fast, let's be honest: the scale at which the industry is conducting projects today is not going to have much impact on the energy market of the future," he said. "For that, we need sustained investment, on a massive scale. A step change of that nature will require sound energy and environmental policies from governments worldwide.
Hayward said that policies should subsidize development of low-carbon technologies--though only during a time of "transition"--and that governments should regulate carbon emissions now.
The naysayers have a point. Eliminating fossil fuels from the energy picture is not going to happen just because of the sharp uptick in corporate green marketing.
Renewable sources, such as wind and solar, accounted for 2.4 percent of electricity generation in the U.S. in 2006, not counting hydro power. Dirty coal is about half of all power generation.
In transportation, ethanol production is rising, spurred by government mandates, but it's mainly used as a gasoline additive, not a replacement. There are about 1,400 E85 filling stations in the U.S., a tiny fraction out of a total 170,000.
So renewable power and fuels are barely used in the U.S. today.
Oh, and by the way, there's now a backlash against biofuels because of ecological concerns such as total greenhouse gas emissions, water, and land use. Will the environmental trade-offs of manufacturing solar cells make more headlines this year? I'd say so.
And then there's this niggling worry that all this investment in clean tech will pop like the Internet bubble someday.
Well, here are a few comments to put those concerns in perspective from people far more versed in these matters than me.
Joseph Stanislaw, the founder of energy advisory firm the JAStanislaw Group and a co-founder of Cambridge Energy Research Associates, spoke at WIREC on Tuesday to tell the business attendees that renewable energy has reached the "big leagues," even compared with the giant fossil fuel industry.
How come? It's not just growing economic impact. It's because of changing values, he argued.
Climate change and energy security are two causes that bind a lot of people together, from economists to stay-at-home moms, Stanislaw said. Those priorities are creating a demand for "sustainable technologies" among consumers and businesses.
Then there is the supply side. Oil has topped $100 a barrel, natural gas prices are volatile, and there's growing resistance to build more coal-fired power plants. This creates an economic incentive for alternative energies, a hedge against high fossil fuel prices.
"This is different from the 1970s," he said. "The transformation that started then has only started to be realized in the last five to ten years."
I think Stanislaw makes a good point: a significant portion of society is changing to favor clean energies and sustainability, in general. The policies and investments to speed technology development are catching up. Maybe not as fast as the Web took off, but we're talking about energy--a capital-intensive industry--and a complex environmental and economic picture.
So green tech may be the cause du jour among many politicians and venture capitalists. But it sure looks like a movement with legs beneath it.
For the last word, I'll quote famed venture capital investor Vinod Khosla who followed Hayward at WIREC with his own talk.
His message was simple: technology disruption always happens faster than you think. Just look at cell phones, semiconductors, or projects to map the human genome.
"We are repeating the same mistakes in energy," Khosla said. "It's hard for people to imagine what energy will look like in 10 or 15 years."
Highlights from my week: a hybrid Mack dump truck, foldable solar panels, biomass pellets to replace coal, and a speech by President Bush.
The first Washington International Renewable Energy Conference (WIREC) 2008, which ran from Tuesday to Thursday, brought together ministers from 119 countries and a trade show floor full of businesses.
The headline event, without a doubt, was a speech delivered by president George Bush on Wednesday morning where he said America has to "get off oil."
Overhanging the entire event, however, was a policy stand-off that renewable energy business people is hurting the U.S. economy.
There was also clean tech on display. For a visual tour through trade and press events, see this photo gallery.
Check out our WIREC coverage from the entire week.
(Credit:
Martin LaMonica/CNET Networks)
WASHINGTON--The world is in the early days of an energy revolution for clean technology, a shift the United States is committed to for economic, political, and environmental reasons, President George Bush said in a speech here Wednesday.
The president spoke to delegates from more than 120 countries at the Washington International Renewable Energy Conference (WIREC) 2008, where he described what the United States has done to promote biofuels, fuel efficiency, and renewable power sources like wind.
"America has to change its habits. It has to get off oil. Until we change our habits, we are going to be dependent on oil," Bush said.
President George W. Bush calls for more renewable energy at international conference.
(Credit: Martin LaMonica/CNET News.com)He remarked that the United States now imports 60 percent of its oil, up from 20 percent in 1985, a situation that leaves the country vulnerable to economic disruptions and attacks from terrorist groups.
The concentration of greenhouse gases has increasingly substantially as well from burning fossil fuels, causing global climate change, Bush said.
The United States does not participate in the United Nations-led Kyoto Protocol for reducing emissions, but it is committed to climate change regulations. The U.S. has organized a forum to create regulations for limiting greenhouse gases. The forum is outside the U.N.; the U.S. has established a parallel process to create regulations.
During Bush's term, he has come under harsh criticism from environmentalists. The prospect of a lapsed renewable energy tax credit at the end of this year has also attracted barbs toward the White House and Senate from businesspeople in the renewable-energy industry.
But Bush said the U.S. is serious about being a good steward of the environment, as long as regulations are consistent with economic growth.
"Look, I understand that stereotypes are hard to defeat. People get an image planted in their head and sometimes it causes them not to listen to the facts. But America is in the lead when it comes to energy independence, we're in the lead when it comes to new technologies, we're in the lead when it comes to global climate change and it will stay that way," he said.
Bush listed provisions in the Energy Independence and Security Act of 2007, which was signed late last year, including higher mandates for ethanol, biodiesel, raised fuel economy standards, and incentives for hybrid cars.
But he also recognized the growing problem of food prices being pushed up from the growing demand for corn-based ethanol and biodiesel. The U.S. and other countries need to accelerate the transition to cellulosic ethanol, which can be made from grasses, wood, and agricultural wastes.
"I'd rather have corn farmers growing energy rather than import oil from countries that may not like us--that's how I view it," he said.
Bush repeated calls for aggressive development of nuclear power and highlighted steps the administration has taken to spur construction of new plants, including construction loan guarantees and research with other countries on nuclear waste disposal.
He also touted wind power and said his native Texas is the leading producer of wind power. And he said he envisions a day when every home "will be an electrical generator of their own and feed it back to the grid through solar power."
In the last full year of his term, Bush indicated that he is thinking about his legacy as a president in regard to energy and climate change. Before delivering the speech at WIREC, he said he reflected on what people would be saying 10 years from now about his administration--and about the pace of technological development in clean technologies.
"I'm confident that when we look back at this period of time, we'll say how could we have doubted the capacity of mankind to develop the technologies necessary to deal with the real problems of the 21st century," he said.
WASHINGTON--The last time tax incentives for renewable-energy projects dried up in the 1980s, energy investor Nancy Floyd got out of the wind business--something she fears other entrepreneurs may do without quick changes to U.S. policy.
Floyd, now the managing director of energy technology venture capital firm Nth Power, was one of a group of businesspeople who held a press conference here to lobby for the renewal of federal tax incentives set to expire this year.
"We're not happy." From left to right: Nancy Floyd, Nth Power; Dan Reicher, Google.org; former California Energy Commissioner John Geesman; Kevin Walsh, GE renewable energy; Credit Suisse Vice Chairman John Cavalier.
(Credit: Martin LaMonica/CNET Networks)The incentives, which provide a federal tax credit for renewable-energy investment, are set to expire at the end of 2008. But the impact is already being felt, said Kevin Walsh, the head of GE's renewable-energy financing division.
"We are already having a tightening of capital right now with the credit crunch. Add on to that the uncertainty in policy and you're scaring capital away," Walsh said.
Some of that capital will go outside the U.S. Because of policies, the first three U.S.-based solar companies to go public used that money to build manufacturing facilities elsewhere to serve those markets, noted Floyd.
Wind, one of the fastest growing energy businesses, will be hardest hit, said John Cavalier, vice chairman at Credit Suisse who heads up the bank's renewable-energy business.
"We'll see an exit from wind deals as early as May of this year," Cavalier said. "We'll probably see a complete moratorium of the great promise of renewable energy."
Solar power plant projects have already been postponed for months, said Christopher Huntington, vice president of business development at solar company SkyFuel.
The House last week passed a bill which would extend the renewable-energy tax credit, which would be paid for by rescinding a tax break extended to oil and gas companies.
But that technique, which has failed to pass the Senate twice before, is unlikely to work, said Marchant Wentworth, Washington representative for clean energy at the Union of Concerned Scientists, an advocacy group.
The issue has become a political contest between Democrats and Republicans, which has made the tax credit a "political hostage."
The other problem is that some senators are focused on increasing fuel production of all sorts, but do not recognize the economic development of the renewable-energy industry, including job creation, Wentworth said.
Dan Reicher, director of climate change and energy initiatives at Google.org, said that there are long-term effects of a continued on again-off again renewable-energy policy.
"We believe we are at the dawn of a green energy revolution potentially as powerful as the Internet revolution," said Reicher who was former U.S. Assistant Secretary of Energy for Energy Efficiency and Renewable Energy. "Policy makers can make or break this revolution."
WASHINGTON--Famed venture capitalist Vinod Khosla told energy and environmental ministers from around the world they greatly underestimate how rapidly energy is moving toward renewable sources.
Khosla was a speaker during the ministerial plenary at the Washington International Renewable Energy Conference (WIREC) 2008 here on Tuesday, where he argued that the energy industry is undergoing a technology disruption, much the way that telecom and computing did decades ago.
Vinod Khosla argues that people underestimate the pace of technology change in energy.
(Credit: Martin LaMonica/CNET Networks)The reason people don't appreciate the pace of change is faulty projections, he said. Government officials and businesspeople trust market forecasts which have consistently been far off-base.
People believed that it would take decades for mobile phones to become widespread, but it happened much quicker because they had mistakenly assumed that the phones would remain the same as the original clunky prototypes. McKinsey forecast that there would be less than 1 million cell phones sold between 1980 and 2000, when the actual number was more like 109 million.
"We are repeating the same mistakes in energy," Khosla said. "It's hard for people to imagine what energy will look like in 10 or 15 years."
Because technology change happens faster than most people anticipate, he believes that several renewable energy technologies will become cost-competitive within five or ten years.
He forecast electricity production at the same price as fossil fuel power plants, biofuels from non-food sources at $1 a gallon, high-efficiency engines and lighting, and carbon neutral cement production.
"All these technologies are in development today. Oil will have to be $35 per gallon to compete," he said.
Underlying his assumptions, however, is a rapid adoption of these energy technologies.
To achieve these cost efficiencies, new energy technologies have to pass what Khosla calls the "Chindia test." That is, the need to be cheap enough for China, India, and other developing countries to purchase.
That scale will accelerate technology development and adoption, he argued. Expensive products like plug-in hybrid cars, which may be the darlings of environmentalists, simply won't drive large-scale change, he said.
"Plug-in hybrids are irrelevant because they are too expensive. Unless you can make 500 million or 800 million of those, it won't matter," he said.
His contention that plug-in hybrids are irrelevant, or "toys," a case he made late last year at a conference, brought fierce criticism from environmentalists.
Although a longtime denizen of Silicon Valley, Khosla is no stranger to Washington, D.C., where he has presented to congresspeople and lobbied for supportive policies.
The U.S. government should boost investment in research and technology and implement regulations that put a price on carbon emissions, he said.
Clearly an optimist, Khosla ticked off a number of technologies he has invested in that could shift the energy industry from fossil fuels, including solar thermal power, cellulosic ethanol, advanced geothermal, synthetic liquid fuels, and energy efficiency.
"We are mounting a war on oil, a war on coal, a war for efficiency and renewable materials," he said.
Correction 10:20 a.m. PST: This blog misstated the day that BP CEO Tony Hayward spoke at the conference. It is Tuesday.
WASHINGTON--Amid rumors that BP will sell its alternative-energy business, company Chief Executive Tony Hayward on Tuesday said that the current scale of the clean-tech industry will not be enough to address the world's energy challenges.
Hayward spoke at the Washington International Renewable Energy Conference (WIREC) 2008 where he called for more aggressive government policies to address both climate change and energy security, which he said were interlinked.
BP Chief Executive Tony Hayward
(Credit: BP)Specifically, he said that nations need adopt a market-based mechanism, called a "cap and trade" system, to limit greenhouse gas emissions, including carbon dioxide. He also said that government "transitional" incentives are required to speed up development of clean technologies.
"Even though clean tech is growing fast, we all need to be honest," he said during a ministerial plenary session. "The scale that the industry is working at today is not going to have much impact."
He said carbon regulations should put a price on pollution. Hayward favors a cap and trade system, where polluters can trade carbon emission allowances, over a carbon tax because it is market-based and provides more "environmental certainty."
A global system, where carbon allowances are traded around the world, would be optimal. But individual countries or regions should implement their own systems and then seek to coordinate with other carbon-trading markets, a process that would mimic how financial markets evolved.
"Nobody can doubt the financial markets are now global but they grew up in individual countries," he said, noting that California has already begun the process of integrating with Europe's carbon market.
BP's primary business is oil and gas exploration but the company has been on the forefront of developing an alternative-energy business, even changing its name from British Petroleum to BP and adopting the tagline "Beyond Petroleum." It has spent $30 billion on exploration since 2001 and intends to invest another $30 billion in the next six years.
It now has a wind and solar business and is partnering with universities to develop "next-generation biofuels" that do not use food crops and are better fuels than ethanol, Hayward said.
He also said that BP is very optimistic it can make carbon capture and storage commercially viable because of its experience in oil and gas exploration. Carbon dioxide is injected underground to help oil and gas extraction.
Altogether BP spends $1 billion a year in alternative energy; the company is rumored to be looking at a sale of that business. Hayward spoke last week at an investor conference, where company watchers interpreted his comments as a signal that it may choose to focus on its core oil and gas business.
When it comes to wind energy, knowing how hard the wind blows is like knowing how much oil you have in the ground.
Renewable-energy assessment company 3Tier released a map that depicts the wind "resources" around the world on Monday at the Washington International Renewable Energy Conference (WIREC) 2008.
The Firstlook map, which uses Google Maps, falls under the 3Tier initiative "Remapping the World," which the company says marks the first time valuable wind resource information has been made available for free.
Before erecting any turbine, wind developers need to choose a spot carefully and then use special equipment, such as a "met" tower, to measure wind over time.
3Tier's map provides data on wind at 80 meters high over an area of 15 kilometers for a year. The company has determined that more than 40 percent of the world's land mass has wind speed of more than 6 meters per second. A lot of that land is not open to development, but the data indicates that there's a lot more potential for wind-generated electricity.
3Tier believes that the Firstlook data might be most helpful for developing countries looking into wind energy projects.
"The map provides enough resolution so countries and organizations can begin to look at the potential wind resource at a regional level," said Kenneth Westrick, CEO of 3Tier. "If we want developing nations to 'leapfrog' over fossil fuels, they need information about what renewable-energy resources, or combination of resources, exist."
The company is working on integrating solar-energy resources around the world into its mapping data.
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