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A Report on the Deliberations of“Visions of Sustainable Economic Growth: A Transatlantic

Dialogue on Energy, Water, and Innovation”

THE SUMMIT’S FINAL PLENARY SESSION

CONVENED AT THE WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS IN WASHINGTON, D.C.,

SEPTEMBER 11, 2012

UNITED STATES AND EUROPEAN UNION SUMMIT ON

Science, Technology, Innovation, and Sustainable Economic Growth

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A REPORT ON THE DELIBERATIONS OF “Visions of Sustainable Economic Growth:

A Transatlantic Dialogue on Energy, Water, and Innovation,” The Summit’s Final Plenary Session

Convened at the Woodrow Wilson International Center for Scholars in Washington, D.C., September 11, 2012

CO-HOSTED BYEuropean Commission

Howard H. Baker Jr. Center for Public PolicyWoodrow Wilson International Center for Scholars

Oak Ridge National Laboratory

SUMMIT SPONSORSNational Science Foundation

Department of EnergyEuropean Commission

ORGANIZING COMMITTEE FOR THE FINAL PLENARY SESSION OF THE U.S.-E.U. SUMMIT

Kent Hughes, Woodrow Wilson International Center for ScholarsJames Roberto, Oak Ridge National Laboratory

Domenico Rossetti, European CommissionRobert Shelton, Howard H. Baker Jr. Center for Public Policy

Bruce Tonn, Howard H. Baker Jr. Center for Public Policy

UNITED STATES AND EUROPEAN UNION SUMMIT ON

Science, Technology, Innovation, and Sustainable Economic Growth

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TABLE OF CONTENTSINTRODUCTION .............................................................................................................4

EXECUTVE SUMMARY .............................................................................................. 7

PANEL ONE: Major Science, Energy, Water, and Carbon Issues over the Next 30 Years in Europe and the United States ..................12

Moving toward Optimized Energy Efficiency, by Marilyn Brown ................12

U.S. Transportation, Energy Security, and the Role of Petroleumby David Greene.......................................................................................................... 14

Water and Energy: A Critical Nexus, by Geoff Dabelko ................................ 16

Sources of Conflict over Energy Resources during the Next 30 Years by Philip Andrews-Speed ..........................................................................................17

Luncheon Presentation: Innovation, Research Keys to U.S. Economic Growth, by Bart Gordon .................................................................... 20

PANEL TWO: Possible Low Carbon Futures over the Next 30 to 50 Years in Europe and the United States ........................22

The Steady-progress Scenario, by Bertrand Château ...................................22

Pathways to a Low-carbon Future, by Milton Russell ....................................25

Willow Pond: A Case Study of a Low-Carbon, Self-sufficient Community of 2050, by Bruce Tonn .....................................................................27

Significant Science Breakthrough Scenario, by George Crabtree ..............29

The World in 2050 and the New Welfare Scenario, by Carlo Sessa ...........31

AGENDA ...........................................................................................................................34

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In 2010, the Howard H. Baker Jr. Center for Public Policy, the European

Commission, Oak Ridge National Laboratory, and the Woodrow Wilson

International Center for Scholars organized the U.S-.E.U. Summit on Science,

Technology, Innovation, and Sustainable Economic Growth.

The Summit, sponsored by the National Science Foundation, the Department

of Energy, and the European Commission, examined the critical impacts of

investments in science, technology, and innovation on sustainable economic

growth. There is increasing national emphasis on the importance of both

science and sustainable economic growth, with science underpinning the

creation of new industries and “green jobs.”

The Summit, whose activities extended over two years, explored the links

between science and economic growth and included two plenary meetings

and four workshops. It is important that policymakers, scientists, and the

broader public understand the implications of how research in science and

technology affects both the structure and long-term growth of the economy.

The Summit has proved unique in two important respects. First, it has

prompted an interdisciplinary examination by leading scientists, economists,

and policy analysts of the relationship between science and sustainable

economic growth.

INTRODUCTION

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While other meetings and symposia have looked at the impacts of science

and technology on the economy, they have tended to be more disciplinary

in nature and designed for specific audiences. Also, they have tended to

focus more on narrow aspects of the growth process, such as the innovation

process. In contrast, the Summit was structured to engage a diverse audience

but also to produce results that are of interest to specialists in science and

science policy.

Second, the Summit has taken place at a time when policy is being discussed

and developed to restructure the economy in a way that will affect long-term

production and employment.

The Summit began with a one-day plenary meeting at the Woodrow Wilson

International Center for Scholars in Washington, D.C., on September 28,

2010. At this initial meeting, participants discussed how past linkages among

investments in science, technology, and education have affected job creation,

employment, and economic growth. While the Summit was designed to

address the impact of science, technology, and innovation’s on sustainable

economic growth, it has given specific attention to the critical areas of energy

and the environment and the necessary innovations for achieving a low-

carbon economy.

The Summit’s opening meeting was followed by four workshops held in 2011

at the Howard H. Baker Jr. Center for Public Policy in Knoxville, Tennessee; the

Woodrow Wilson Center in Washington, D.C.; the Paris School of International

Affairs in Paris, France; and the European Commission’s Conference Center in

Brussels, Belgium.

The two U.S. workshops focused on energy and the critical link between

energy and water. The third workshop, held in Paris, focused on energy

security, and the fourth workshop, held in Brussels, explored innovation that is

necessary to move toward a post-carbon economy.

The Summit’s final plenary meeting, “Visions of Sustainable Economic Growth:

A Transatlantic Dialogue on Energy, Water, and Innovation,” convened

September 11, 2012, at the Woodrow Wilson Center to summarize the findings

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and examine the implications of a post-carbon world. This report presents a

summary of the Summit’s final plenary session.

“The Summit has created a fruitful and useful process for both sides of the

Atlantic,” said Summit organizer Robert Shelton, a senior fellow for Energy and

Environment at the Baker Center. “Over the coming years the Baker Center will

continue the dialogue and further strengthen the relationships that have been

forged through the Summit’s activities.”

Reports on the Summit’s opening and closing plenary sessions and two

workshops and a summary report on all Summit activities have been

completed and will be posted on the Baker Center website.

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EXECUTIVE SUMMARY

“Visions of Sustainable Economic Growth: A Transatlantic Dialogue on Energy, Water, and Innovation” drew an international audience of policymakers, elected officials, scientists, venture capitalists, planners, and academics and featured expert presentations on energy efficiency, the role of research and technology in spurring economic growth, renewable energy sources, conflicts over finite energy and water resources, prospects for a low-carbon future, transportation, energy security, energy-water links, and emerging energy and environmental technologies.

The session comprised two panel discussions: “Major Science, Energy, Water, and Carbon Issues over the Next 30 Years in Europe and the United States” and “Possible Low-carbon Futures over the Next 30 to 50 Years in Europe and the United States.”

“Today we are addressing a critical issue: how we can use the tools of science and technology to create sustainable economic growth,” said Jane Harman, Wilson Center director and former U.S. Representative from California, in opening the conference. “To achieve a sustainable future, we must explore available resources as well as environmental barriers that challenge growth across the globe.”

According to Errol Levy, first secretary for Science, Technology, and Education of the European Union Delegation to the United States, “if we are going to address the big challenges that we face globally, secure the future of our planet, and create prosperity and quality jobs, the United States, the European Union, and our international partners must work together.” The quality discussions of the U.S.-E.U. Summit will help define how U.S.-E.U. administrations, private sectors, and NGOs will engage with each other in the future on these critical issues, said Levy.

Domenico Rossetti, principal administrator at the European Commission’s Directorate-General for Research and Innovation, observed that “we in the

A two-year U.S.-E.U. summit on science, technology, innovation, and sustainable economic growth concluded in September 2012 with a plenary session at the Woodrow Wilson International Center for Scholars in Washington, D.C.

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European Union and the United States share much in common, including democratic forms of government, market economies, and respect for the rule of law and gender equality.” Because of these shared values, Rossetti said, we have considerable potential for sustaining and improving cooperation in research and innovation.

“Europe and the United States have the most globalized and open innovation systems in the world. We both respect the protection of intellectual property rights and fair market rules. This is of great value to keep a sustainable and long-term partnership,” said Rossetti. Investment in research is critical for future prosperity in the European Union and United States. “Data indicate that the E.U. countries that have invested more in research and development—including Germany, Finland, and Sweden—have suffered less from the current economic crisis and continue to have relatively high GDP growth,” Rossetti said.

The two main political parties in the United States have very different platforms regarding energy policy and science, said Summit organizer Robert Shelton, a senior fellow for Energy and Environment at the Baker Center. “The Republican Party believes that the market should make decisions regarding energy investments and that we should move away from subsidies for renewable energy sources,” said Shelton.

Further, the Republican platform says very little about carbon emissions and does not see a role for the EPA in regulating these emissions. “Unlike the Republican Party, the Democratic Party tends to be more supportive of development of renewable energy sources and increased energy efficiency,” said Shelton. “The Democratic Party also embraces the science of human-caused global climate change and sees the issue as one that the government should address.” Because of the widely divergent platforms of the two major U.S. political parties, pursuit of a low-carbon future remains controversial in the United States.

Since World War II more than half of U.S. economic growth can be attributed to the development and adoption of new technologies, said Bart Gordon, former chairman of the Committee on Science and Technology of the U.S. House of Representatives. “The path is simple,” said Gordon. “Research and education lead to innovation, innovation leads to economic development and good paying jobs, and economic growth produces revenues for more research.”

Bertrand Château, co-founder and president of ENERDATA, an independent energy research and consulting firm based in Grenoble, France, explored possible scenarios for the European Union’s transition to a low-carbon future despite an aging population and increased energy intensity resulting from households with fewer residents.

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“Among the innovations in support of the steady-progress scenario are centralized renewable power sources for electricity generation and smart grids capable of managing intermittency of renewable power sources as well as peak demand,” said Château. “Among the leading priorities for the transport sector is expanded electro mobility, in part through the development and distribution of pure electric vehicles.”

David Greene, a Baker Center senior fellow and ORNL corporate fellow, asserted that “the U.S. energy security situation, by and large, is about dependence on petroleum, and the transportation sector is the predominant consumer of petroleum.” In fact, said Greene, the U.S. transportation sector consumes 6,500 gallons of petroleum every second, more than any other economy in the world, including China’s. Within the transportation sector, greenhouse gas (GHG) emissions are almost entirely about carbon dioxide (CO

2) from burning petroleum.

According to Greene, the U.S. transportation sector alone produces more CO2

than any country’s entire economy, except China’s. “The EPA’s fuel-efficiency standards [54.5 miles per gallon by 2025] plus the renewable fuels standard, if achieved, would put U.S. light-duty vehicles on a plausible path toward an 80-percent reduction in GHG emissions until 2025-2030,” said Greene. “To achieve sustainability by 2050, we need to further transform the carbon basis of our energy systems by transitioning to low-carbon electricity and hydrogen.”

George Crabtree, a scientist with Argonne National Laboratory and professor at the University of Illinois at Chicago, explored “transformational” future technologies. “Chemical energy carriers like fossil and biofuels can be made sustainable by recycling their spent outputs, carbon dioxide and water, to fresh fuel, using solar energy,” said Crabtree. “The photochemical and photothermal routes for such regeneration are many and remain largely unexplored.”

Crabtree also discussed an international market for energy, mediating across countries, regions, and carriers. Such an international market, said Crabtree, “requires not only societal and financial institutions but also technical discovery and implementation of inexpensive and efficient conversion routes among the three primary energy carriers: light (from the sun), chemical fuel, and electricity.” According to Crabtree, such interchangeability would add flexibility, diversification, and back-up options to energy markets that are now compartmentalized by region and carrier.

According to Marilyn Brown, a professor of energy policy with the Georgia Institute of Technology, about 80 percent of the world’s CO

2 emissions are

locked in to existing infrastructure. “We have committed to power plants,

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industrial infrastructure, highway systems, and other enduring large energy-intensive CO

2 emitters,” said Brown.

Nevertheless, “over the next two decades, the United States will see a quad of energy shift mostly from the transition from incandescent to energy-efficient lighting,” said Brown. “This represents the largest technological shift of any end-use products in the country.” Other promising technologies include “smart” electric grids and new high-efficiency integrated units that heat water, heat and cool air, and control humidity in residential and commercial buildings.

Carlo Sessa, president of the Institute for Studies for the Integration of Systems in Rome, Italy, discussed the European PASHMINA project, which created possible scenarios for the world of 2050. According to Sessa, the new-welfare scenario reflects a reconceptualization of production, from short-lived to longer-lasting goods and from private to open source knowledge products and services; growth in recycling and zero-waste processes; and a shift from profit-driven business to entrepreneurship that seeks to satisfy social needs and build local capital. Under the new-welfare scenario, “a paradigm shift will occur in the form of government,” said Sessa. “New global democracy networks and institutions will be created, and constitutions will go beyond protecting human rights to the recognition of ‘nature rights.’ Citizen income will be tied to duties in service of the social welfare and participatory governance.”

A warming planet will further place global water resources at risk, according to Geoff Dabelko, senior advisor for the Wilson Center and professor in the Voinovich School of Leadership and Public Affairs and director of Environmental Studies at Ohio University.

“Variable climate is going to be the new normal, and our energy infrastructure, which is based on the notion of stasis, is just not going to work when there is not enough water in some places and too much in others,” said Dabelko. “The French have experienced the shutdown of nuclear power plants because the cooling water was too warm to be effective. The drought has also affected coal-fired as well as hydro power plants, and one hopes that we regard these situations, not as episodic, but indications of future conditions that will result from a warming climate.”

According to Milton Russell, a senior fellow with the Institute for a Secure and Sustainable Environment at the University of Tennessee, the policies that will lead us toward a low-carbon future are going to be costly and disruptive in the short run. These policies “will raise issues of equity, and they will create winners and losers among powerful political forces,” said Russell. “Building the necessary political consensus, at a minimum, will require, first, that we

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make a clear presentation of the significance of the problem. Further, if we hope to make progress, we will need sensible, understandable, cost-effective, minimum-cost policies. And, in terms of getting public policy support in Europe and the United States, we must establish achievable targets consistent with the level of risk and sacrifice the public is willing to accept.”

Bruce Tonn, senior fellow at the Howard Baker Center and professor in the Department of Political Science at the University of Tennessee, imagined Willow Pond, a low-carbon, self-sufficient U.S. community of 2050. Artificial intelligence systems control homes’ interior environments, yards and green spaces create habitat for wildlife and produce biomass plants, algae produce hydrogen, and local manufacturing is based on 3-D printers and “infinitely recyclable, reusable, and/or renewable products, including plastics, aluminum, glass, steel, and graphene.”

In 2005, the scale of oil import revenues was very small, according to Philip Andrews-Speed, a principal fellow at the Energy Studies Institute of the National University of Singapore. By 2040, we will see the Middle East with much greater export revenue from oil. We also will see Asia, particularly China, India, and Indonesia, with enormous increases in bills for oil imports.

These asymmetries will vary with resource prices, said Andrews-Speed. “If, for instance, oil goes down to $20 a barrel, you will see fewer shifts. But these asymmetries of rents along the supply chain make cooperation much more difficult, and we don’t see this easing in the near future.”

By 2040, said Andrews-Speed, national oil companies will not only hold the resources in their own countries, they are will become much more active around the world, particularly in the fossil energy sector.

Kent Hughes, director of the Wilson Center’s Program on America and the Global Economy, closed the conference by acknowledging the vital contribution of the European participants in enriching the conference dialogue. “They and the other conference participants have done an excellent job of defining the stakes that we all have in designing a better and more sustainable future,” said Hughes. “You have spelled out many useful alternatives for action and given us a sense of the different scenarios that help clarify our thinking about the future. I hope we can continue this transatlantic dialogue to help identify other areas of fruitful collaboration.”

The journal Futures will produce a special edition devoted to presentations from the Summit’s final plenary session.

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ORGANIZING COMMITTEE “Visions of Sustainable Economic Growth: A Transatlantic Dialogue on Energy, Water, and Innovation,”The Final Plenary Session of the U.S. and E.U. Summit on Science, Technology, Innovation, and Sustainable Economic Growth

Kent Hughes, Woodrow Wilson International Center for Scholars

Robert Shelton, Howard H. Baker Jr. Center for Public Policy

James Roberto, Oak Ridge National Laboratory

Bruce Tonn, Howard H. Baker Jr. Center for Public Policy

Domenico Rossetti, European Commission

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PANEL ONE: Major Science, Energy, Water, and Carbon Issues over the Next 30 Years in Europe and the United States

Moderator, Paul Peercy, Dean, College of Engineering, the University of Wisconsin

MOVING TOWARD OPTIMIZED ENERGY EFFICIENCYBy Marilyn BrownMarilyn Brown is a professor of energy policy at the Georgia Institute of Technology.

According to the 2011 Energy Information Administration’s World Energy Outlook, “the door is closing” on a 450 parts per million (ppm) future carbon dioxide (CO

2) concentration. The 450 ppm level is

consistent with constraining increases in global temperatures to 2°C. The door is closing, in part, because about 80 percent of the world’s CO

2 emissions

are locked in to existing infrastructure. We have committed to power plants, industrial infrastructure, highway systems, and other enduring large energy-intensive CO

2 emitters. Indeed, four-fifths of the total energy-related CO

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emissions “permissible” by 2035 is are already locked-in by our existing capital stock.

In the future, there will be a dramatic shift in the energy demand of OECD and non-OECD nations. Consider, for instance, that the United States currently accounts for about 25 percent of total global energy consumption. By 2100, the U.S. share of energy consumption will fall to about 10 percent. The statistics for the European Union are comparable. As these figures suggest, the future roles for the United States and the European Union in driving global energy trends may be greatly diminished, unless, of course, the rest of the world adopts our strategies for achieving dramatic increases in energy efficiency. Over time, energy efficiency has played a major role in reducing energy intensity, and this trend will continue and improve over the next 25 years. But much more is needed.

According to the American Council for an Energy Efficient Economy, the United States ranks ninth in the world in energy efficiency. The United Kingdom,

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France, Italy, and Germany all out performed the United States in terms of this metric.

Nevertheless, since the Arab oil embargo of the early 1970s, the United States is using energy much more efficiently. In fact, over recent decades, energy efficiency has been the largest energy resource contributor, but we continue to import much of our energy-intensive commodities.

Over the next two decades, the United States will see a quad of energy shift mostly from the transition from incandescent to energy-efficient lighting. This represents the largest technological shift of any end-use products in the country. Other promising technologies include new high-efficiency integrated units that heat water, heat and cool air, and control humidity in residential and commercial buildings. Despite the positive press that energy efficiency has been receiving over the past several years, there has also been opposition, including the contention that energy efficiency will trigger a rebound effect. The Prius effect, for instance, maintains that if you can drive cheaper, you will drive more miles. Likewise, if you have a high-efficiency heat pump, you will turn up the heat in the winter, and a consumer who is saving on energy costs through use of energy-efficient lighting might decide to buy a large-screen plasma TV. There is, in fact, a rebound effect, but the empirical evidence suggests that it is quite small, in the 5- to 15-percent range, and would not eliminate the benefits of investing in energy efficiency.

The existing electricity infrastructure in the United States is aging and inefficient, and we need an improved system that does a better job at incorporating demand response and energy efficiency. Indeed, we need a smarter grid that communicates in both directions, conveying information to the utility company and to the consumer, and that enables informed decisions on the part of the end user.

There is a clear need for a set of new policies to facilitate this transformation to a smart grid, including those that allow meters to feed electricity in both directions for residences and businesses that, for instance, produce solar power. We also need dynamic pricing that reflects the utility’s real cost in producing the electricity. These rates can vary significantly through the day, based on on- and off-peak demand. Currently, the United States emits 18.1 tons of CO

2 per capita, and renewables

provide 11 percent of our electricity supply. The Obama administration’s goal is for clean energy to supply 80-percent of the nation’s electricity supply by 2035.

The United Kingdom’s emission of CO2 per capita is less than half that of

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the United States (8.5 tons), while renewables meet 7 percent of the United Kingdom’s power demand. In part because of the penetration of smart meters throughout the country, Italy’s per capita CO

2 emissions are 7 tons, while

renewable sources provide 27 percent of Italy’s energy supply.

International and domestic collaboration will be essential if we hope to achieve our energy-efficiency goals. We can learn much from each other, for instance, on smart-grid technologies and policies. Further, a smart grid will require a policy framework that attracts financing from many sources, private and public, because the transformation will be costly. Regulatory changes are also needed to promote competitive electricity markets.

U.S. TRANSPORTATION, ENERGY SECURITY, AND THE ROLE OF PETROLEUMBy David GreeneDavid Greene is a senior fellow at the Howard H. Baker Jr. Center for Public Policy at the University of Tennessee and a corporate fellow at Oak Ridge National Laboratory.

The U.S. energy security situation, by and large, is about dependence on petroleum, and the transportation sector is the predominant consumer of petroleum. The U.S. transportation sector alone consumes about 6,500 gallons—or about 25,000 liters—every second, more than any other economy in the world, including China’s. Within the transportation sector, greenhouse gas (GHG) emissions are almost entirely about carbon dioxide (CO

2) from

burning petroleum. The U.S. transportation sector alone produces more CO

2 than any country’s entire economy, except China’s. We cannot achieve

the necessary reductions in GHG emissions from transportation by 2050 without reducing petroleum use in the United States to almost nothing. The two objectives, energy security and a sustainable energy system, are largely consistent.

Petroleum dependence is the result of a market failure and imperfect competition due to the partial monopolistic power of the OPEC cartel, with significant implications for national security. There are also issues related to foreign policy and national defense costs, but problems related to petroleum dependence are largely derivative of economic issues, and pursuing a low-carbon sustainable energy system will ultimately solve the problem of petroleum dependence.

As MIT Professor Morris Adelman said: “The real problem we face over oil

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dates from after 1970: a strong but clumsy monopoly of mostly Middle Eastern exporters operating as OPEC.” We don’t need to say clumsy; these are sovereign states, and they don’t necessarily agree on everything. In the early 1970s, the peaking of U.S. conventional oil production combined with the first exercise of market power by Arab members of OPEDC produced the first oil price shock of the OPEC era, and things have never been the same since. OPEC continues to wield considerable market power in world oil markets. Consider, for instance, that when oil prices peaked in 1980, OPEC members consistently reduced output through 1985 in order to maintain high prices. This past year, when oil prices topped $100 a barrel, Saudi Arabia actually cut back on production. In a truly competitive market, as the price goes up, producers increase, rather than decrease, production.

Higher oil prices reduce the economy’s ability to produce, regardless of whether they are caused by a physical scarcity of oil or by monopoly power. In the event there is a price shock, the economy also experiences a temporary disequilibrium. For example, Americans who drive large SUVs may opt instead for smaller, more fuel-efficient cars. That, in turn, creates excess labor and excess capacity in large SUV plants. This happens in many ways throughout the economy. And the sudden transition to production of smaller vehicles causes a short-term idling of labor and capital, which further diminishes GDP.

Then there’s the transfer of wealth. Monopoly pricing of oil makes the United States and others who import oil poorer as it makes the countries that sell oil richer. According to my estimates, economic losses due to oil dependence last year amounted to $500 billion, about half through the transfer of wealth and about half through losses of GDP. In the past five years, the losses total about $2 trillion.

It is important that the public in the United States understands the real risks of climate change. The United States and the rest of the world are more and more on a path toward unconventional oil, which is exactly the wrong path, if we hope to protect the climate. It is the vast quantities of carbon in coal and unconventional oil and gas that must be kept out of the atmosphere. Fortunately, we have several important policies in place that can put our transportation sector on a path to sustainable energy. These include increased fuel economy of light-duty vehicles and heavy trucks and increased production of low-carbon fuels. Improved fuel efficiency is critical because it directly reduces GHG emissions and also decreases the amount of low-carbon energy that must be produced. Consider, for instance, the historic decoupling of growth in vehicle travel with growth in fuel consumption as a consequence of our increased fuel economy standards. Consumers are saving about 70 billion gallons of gasoline each year as a result of increased efficiency of the vehicles they drive.

The EPA’s new average auto fleet fuel-efficiency standard of 54.5 miles per

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gallon by 2025 is certainly a step in the right direction. The 2025 fuel-efficiency standards plus the renewable fuels standard, if achieved, would put U.S. light-duty vehicles on a plausible path toward an 80-percent reduction in GHG emissions until 2025-2030. To achieve sustainability by 2050, we need to further transform the carbon basis of our energy systems by transitioning to low-carbon electricity and hydrogen.

WATER AND ENERGY: A CRITICAL NEXUSBy Geoff Dabelko Geoff Dabelko is senior advisor for the Woodrow Wilson International Center for Scholars and professor in the Voinovich School of Leadership and Public Affairs and director of Environmental Studies at Ohio University.

A rich discussion has emerged over the development and widespread use of hydraulic fracturing (fracking), which is not a new technology, but we’ve seen the emergence of a new way of deploying it. During the Summit workshop on the energy-water nexus (“Energy, Water, and Innovation,” the Wilson Center, September 2011), we discussed various policy responses and the role of science and the precautionary principle in tackling these issues. We received contrasting responses from Europe and the United States, but there is contrast even within the United States in terms of how states are responding to the fracking boom. Pennsylvania and Texas are moving full speed ahead, while New York is moving cautiously, in part because the terrain does not lend itself to fracking. Meanwhile, California is pursuing vertical fracking but doing very little with horizontal fracking, which is much more water intensive. So in many ways, in terms of fracking, both policy and science are playing catch-up. Academics, policymakers, and, to some extent, scientists are operating with very little detailed information on the issue’s real challenges, particularly in terms of frackings impacts on water. Nevertheless, a lot of pronouncements—both for and against use of fracking—are being made with greater certainty than research actually supports, so clearly, we need to invest more of our scientific resources in exploring this issue. By contrast, here in the United States, the science has been pretty clear on other issues, including corn based ethanol in terms of its significant demand for water and the increased production of corn it requires. In that context, we

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invested our hopes for a sustainable renewable energy in an inappropriate technology. If there is an overarching theme to all of this, it would be an underappreciation of the water-energy nexus and failure to integrate it into our energy decisions.

We will all be forced to contend with a warming planet, which will further put our water resources at risk. This summer, we in the United States experienced excessive heat and drought, and, as a result, we learned some of the lessons that Europe learned six, seven, eight years ago, when that region experienced drought. Variable climate is going to be the new normal, and our energy infrastructure, which is based on the notion of stasis, is just not going to work when there is not enough water in some places and too much in others.

The French have experienced the shutdown of nuclear power plants because the cooling water was too warm to be effective. The drought has also affected coal-fired as well as hydro power plants, and one hopes that we regard these situations, not as episodic, but indications of future conditions that will result from a warming climate. Those of us who are focused on research and the interpretation of these conditions need to remember that these issues will have a public profile and will be debated, particularly in the context of policy. It is essential that we find ways to move beyond popular culture—beyond, for instance, the movie Gasland, in the case of fracking—in informing the debate.

SOURCES OF CONFLICT OVER ENERGY RESOURCES DURING THE NEXT 30 YEARSBy Philip Andrews-Speed Philip Andrews-Speed is a principal fellow at the Energy Studies Institute of the National University of Singapore.

When we started the POLINARES project, we looked at the world of the last 100 years in terms of oil, gas,

and mineral resources. Through our study, we detected periods of 15 or 20 years during which global norms were dominated either by empires, state behavior, or liberal markets. This study led to the conclusion that 2010 to 2040 represents two periods. Further analysis determined that we are currently in a transitional phase, and, in this phase, the resources sector is much more state dominated than during the liberal economy of the 80s and 90s. We sought to model the future, in part, based on that determination.

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In the short term, to 2020, we forecast a slight shift from a global energy and minerals economy, where one of the driving norms is markets, to a world in which states play a greater role, not only in energy and minerals but also in banking. Clearly, if you look at history, high mineral prices mean you get more state capitalism and more resource nationalism. Over the past few years, we have seen the arrival of new actors and new laws. During the 1970s, the only key players were the OECD and OPEC. We now have a whole raft of important new players. The global recession and high energy prices have placed resource-importing countries—incuding the European Union—at a further disadvantage. North America is being rescued by new, unconventional resources of gas and oil. For the European Union, this is an unstable period full of risk and uncertainty.

When our projection extends over the next 30 years, we identify three themes. In terms of access to markets, the issue is the disparity between global institutions and the norms and values that are held by the many important players out there, not least in the energy and materials sector. This creates an unequal playing field for countries as well as companies. It is like a soccer match where somebody has picked up the ball and run with it. This creates a mismatch between the world as we in Europe and America like to see it and the world that is actually out there. As a result, markets will not work as well as they would in a more market-based economy. And because of this uncertainty, we are seeing today, not least with the financial crisis, a global risk of underinvestment in new technologies for clean energy and for energy efficiency.

The second theme is trade and the rate distribution along the supply chain, with changing energy trade patterns and the concentration of rents upstream. In 2005, the scale of oil import revenues was very small. In 2040, we see the Middle East with much greater export revenue from oil. We also see Asia, particularly China, India, and Indonesia, with enormous increases in bills for oil imports.

These asymmetries will vary with resource prices. If, for instance, oil goes down to $20 a barrel, you will see fewer shifts. But these asymmetries of rents along the supply chain make cooperation much more difficult, and we don’t see this easing in the near future.

As for the third theme, state companies, whether in the metal sector or in the oil and gas sector, are becoming more dominant, not just at home, but overseas as well. These national oil companies (NOCs) not only hold the resources in their own countries, they are also becoming much more active around the world, particularly in the fossil energy sector. Further, these NOCs are sometimes part of the government policy. There are two implications

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of this. First, if you are a private-sector oil company, you are facing greater competition. The second implication is the fear that, in tight market conditions, the NOCs will gain greater control and thus diminish the effectiveness of the market.

There is significant potential for lowering costs for both old and new energy forms and for increasing efficiency. In many countries, including China and Germany, the government is the primary actor in promoting renewable energy. In other countries, including the United States, the private sector is the primary driver. But we must not undervalue the important role citizens play in supporting improved energy-efficiency technologies. Indeed, in many countries, the people determine to what extent new technologies are acceptable and how quickly they will be adopted. So the key message is that the timing, in terms of the development as well as implementation of new technologies, is unpredictable, as are the impacts of these technologies. Based on these themes, we developed four scenarios, projecting forward from 2020. The Bretton Woods 3.0 scenario reflects a cooperative world with a market economy—a world in which we are all comfortable. The Celestial Dragon scenario reflects a collaborative world but one based on state interests, with countries like China being the norm centers rather than the free-market economies of the United States and the European Union. The Fracture scenario imagines weak state governance and conglomerates competing for dominance of value chains. The Rubik’s Cube scenario projects regional or national energy monopolies, regional or bilate trade, and strong state governance of the economy.

As we project over the longer term, the big question is to what extent changes in norms and values with respect to the management of energy and climate change will affect the transatlantic community. For Europe, the choice is to engage as equals with the new players and identify shared interests, to obstruct the process, or stick our necks in the sand.

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INNOVATION, RESEARCH KEYS TO U.S. ECONOMIC GROWTHBy Bart Gordon Bart Gordon is a partner of K&L Gates and former chairman of the Committee on Science and Technology of the U.S. House of Representatives.

Throughout our history, from our founding fathers to the garage inventers who created the Internet revolution, the United States has been a country

of big ideas and innovation. We have encouraged a spirit of creativity and productivity that is responsible for the economic growth that we have enjoyed over the past 200 years.

Since World War II, more than half of U.S. economic growth has resulted from the development and adoption of new technologies. The path is simple: research and education lead to innovation, innovation leads to economic development and good paying jobs, and economic growth leads to revenue to pay for more research. Currently, many private companies are under-investing in research and development because they believe these investments will not produce returns quickly enough.

In 2007, I introduced the America Competes (America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science) Act, which sought to raise significantly the level of federal investment in basic R&D and to put the National Science Foundation, the National Institute of Standards and Technology, and the Office of Science within the Department of Energy on a path to double their funding bases for research. We also created programs to ensure that K-12 teachers possess the knowledge necessary to help the next generation succeed in math, technology, engineering, and mathematics (STEM).

Through a bipartisan process, we created the Advanced Research Project Agency for Energy (ARPA-E), which fills the need for high-risk, high-reward energy R&D that neither government nor the private sector is willing to pursue. It is often challenging to explain the real-world implications of big science and basic research. A decade ago, I was involved in trying to enact the policy and funding necessary for creation of the spallation neutron source (SNS) at Oak Ridge National Laboratory. Most members of Congress at that time had trouble understanding what it was or why it was important. Today SNS provides researchers with unprecedented and unique opportunities, and they

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are using SNS to address a diverse range of issues, including birth defects from mercury poisoning, development of superior electric vehicle batteries, and ways to improve the nutritional value of dairy products. Similar advancements are taking place at the European Organization for Nuclear Research (CERN) and other research centers on the continent.

The United States and the European Union share a similar culture, a similar standard of living, and similar wage scales, so it is imperative that we cooperate in terms of research, standards, and regulation. There are many scientific fields that are ripe for collaboration between the United States and the European Union, and two of the more promising are synthetic biology and nanotechnology. In the area of synthetic biology, we need to remain sensitive to European concerns about genetically modified organisms. To explore and resolve these and other concerns about synthetic biology, the United States and the European Union should establish joint research programs on the health and safety of issues associated with these emerging technologies.

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PANEL TWO: Possible Low Carbon Futures over the Next 30 to 50 Years in Europe and the United States

Moderator, James Roberto, associate laboratory director for Science and Technology Partnerships, Oak Ridge National Laboratory

THE STEADY-PROGRESS SCENARIOBy Bertrand ChâteauBertrand Château is president of Enerdata, in Grenoble, France.

Over the past few years, the European Union has carried out two related research programs. The Pathways for Carbon Transitions (PACT) program explores the changes in technologies, behaviors,

and social organization that will allow Europe to move toward a post-carbon society. The Paradigm Shifts Modeling and Innovative Approaches (PASHMINA) program addresses global change over a long time perspective (2030-2050) through development of models and indicators capable of assessing the interaction between the economy and the environment, with a particular focus on the energy-transport-environment nexus in relation to urbanization. As part of these programs, we have developed three major scenarios that represent potential paths toward a post-carbon society. The steady-progress scenario for the European Union is based on three main foundations: economic growth, innovation and human capital, and anticipation of physical limits on climate and natural resources—especially fossil fuels. These limits will threaten the growth of GDP if they are not anticipated and fully addressed. This steady-progress scenario is driven by top-down forces, including globalization and markets as preconditions for long-term growth and a lead role for government and the big stakeholders in making the transition. Government leadership will ensure adequate and consistent policies among E.U. member countries that raise human capital and facilitate the green innovations. The big stakeholders will propose new technologies and services,

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most of them the products of big science. This top-down approach will create a high level of consensus on threats and how to address them, including commitments on carbon intensity of GDP among the Annex1 countries (including the European Union and the United States) and Brazil, Russia, India, and China, but with a high level of flexibility in how these countries fulfill their commitments. Greenhouse gas (GHG) emissions targets will include GHGs embodied in nations’ imports and exports, so it will not just be a matter of developed nations exporting their emissions to developing countries. This steady-progress scenario also includes mechanisms to prevent price shocks and turbulence in oil and gas markets.

Land-use policies are important in this scenario. These policies will control urban sprawl by giving priority to the small and medium-sized cities that are satellites of the big cities. Transport policies will address demand for increased speed without increasing GHG emissions by spatially networking cities and creating a fast-rail infrastructure. Among the innovations in support of the steady-progress scenario are centralized renewable power sources for electricity generation and smart grids capable of managing intermittency of renewable power sources as well as peak demand. Among the leading priorities for the transport sector is expanded electro mobility, in part through the development and distribution of pure electric vehicles. A switch to a different type of technology for mobility may change mobility patterns. Consider, for instance, the issue of recharge time for electric vehicles and how that might affect transportation choices. In the transition to a post-carbon Europe, we will see small growth of the population but a huge change in the makeup of the population. In particular, over the next 40 years, Europe’s population of those 75 and older will double and become much less active. The working population will decline from 66 to 61 percent. The number of occupants per household will also decrease as the population ages, with the percentage of individuals living alone exploding from 28 to 45 percent. These one- and two-person households will create a more energy-intensive lifestyle given the same income, because each person will occupy a larger amount of interior space and rely on the same range of amenities and appliances that are in place in homes with a larger number of residents.

In this scenario, people are looking for increased income and a larger range of consumer goods and products. Currently, European residents seek to reduce the time they spend at work and increase their leisure time, but the steady-progress scenario suggests that we may see a reversal of this, with increased time devoted to work. As a result, we expect a strong increase in GDP per capita, despite the fact that the overall hours of labor will remain more or less

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flat because of the aging of the population. Much of the growth in per-capita GDP will result from innovations that increase productivity.

The steady-progress scenario calls for an end to urban sprawl, with an increased emphasis on development of small and medium-sized cities. Nevertheless, as the population ages, older residents may look for flats in the large cities first because of a greater range of amenities. This will dramatically increase demand for new dwellings in these big cities because there will be fewer residents in each dwelling.

The relation between transportation speed and GDP will likely continue as it has over the past 40 years, but the mobility of the future population will be influenced greatly by the structure and location of the population. The main component of increased speed will be an explosion of long-distance traffic. By 2050, long-distance travel will quadruple. The tremendous challenge here is that travel by car will not be compatible with this trend because even cars of the future will not boast adequate speed to compete with air travel and fast trains. If Europe cannot rapidly develop the fast-train networks, it will experience the explosion of air traffic that now besets the United States. Within 15 years, it is likely that few automobiles featuring pure internal combustion engines will be on the market. By 2050, we will have only plug-in hybrids and 100-percent electrical vehicles. If we look at the distribution of these vehicles according to the place of residence, we find that the fastest growth in plug-in hybrids and purely electric vehicles will occur in the small cities. By 2050, more than 60 percent of the energy required for urban and regional transportation might be supplied by electricity, which means the consumption of diesel and gasoline will decline to a quarter of current levels. The growth of the fleet of electric vehicles will create a significant demand for recharching. There are two potential approaches to providing the electricity needed to refuel the vehicles: a decentralized system with photovoltaic panels on the roofs of the houses as parts of local grids or a centralized electricity production system fed by wind and concentrating solar power. This latter system would feature advanced batteries capable of storing electricity to manage peak loads and the intermittency of renewable energy sources.

By 2050, Europe will see a fairly sharp decline in demand for oil, and, to a lesser extent, for coal, little change in natural gas, and a steady increase in nuclear, biomass, and other renewables.

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PATHWAYS TO A LOW-CARBON FUTUREBy Milton RussellMilton Russell is a senior fellow with the Institute for a Secure and Sustainable Environment at the University of Tennessee.

There is not a lot of mystery about the conditions required to create a low-energy or a low-carbon future, projecting 30 to 50 years into the future.

Further, it is no mystery that the current policies in place in the United States are inadequate and perhaps misguided if we hope to achieve these goals. Deploying new technology, deploying strong R&D in basic research, and mounting strong public policy action are absolutely necessary.

The policies that will lead us toward a low-carbon future are going to be costly and disruptive in the short run. They will raise issues of equity, and they will create winners and losers among powerful political forces. Building the necessary political consensus, at a minimum, will require, first, that we make a clear presentation of the significance of the problem. Further, if we hope to make progress, we will need sensible, understandable, cost-effective, minimum-cost policies. And, in terms of getting public policy support in Europe and the United States, we must establish achievable targets consistent with the level of risk and sacrifice the public is willing to accept.

To minimize cost and to achieve this public acceptance, we should pursue four pathways simultaneously. The first is technological development and innovation as vehicles for enhanced energy efficiency. This pathway will require more and better ideas, more and better investment, and better execution and deployment of energy-efficiency technologies. Often, when people hear or talk about technological development and innovation, they think in terms of big science, dramatic breakthroughs, and transformative ideas and concepts. Instead, reaching our low-carbon goals will be more a matter of small improvements in every dimension. A revenue-neutral carbon tax will play an essential role in making doing good consistent with doing well. If the carbon price is high, it will profit individuals and entities that increase their energy efficiency.

Equally important are advances in human capital through improvements in STEM education and workforce development. We will also need improved intellectual property rights and reduced regulatory inhibitions along with an acculturated commitment to reduced consumption. So that is the first pathway to moving toward a stationary state.

The second pathway involves a transition toward an infrastructure that is

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consistent with a low-carbon future. A certain rise in carbon price, such as is effected by a substantial carbon tax, will do much to prompt and sustain this transition. It will incentivize private action in terms of building design and location. Also needed are revised planning, zoning, and building codes.

The third pathway is increased production of noncarbon energy. The question, though, is how are you going to produce the additional noncarbon energy that is required? Massive quantities of additional energy will be required to sustain a larger population, and, we hope, a rising standard of living. In the United States, policies have prompted creation of boutique supplies of renewable energy; that is to say, expensive small production of low-carbon energy that is bought because of brand not because of utility. This is feel-good energy, which sometimes comes at a high social cost.

In contrast to these boutique supplies, what we will need by 2040 or 2060 is a sustainable, Walmart-type, production of low-carbon energy, which will include an array of supply sources and systems that are dependable and robust, universally available, and suitable for most applications. These demands require that we talk about the gorilla in the closet, which, in this case, is nuclear power. Nuclear energy is a proven but improvable technology, with the potential for massive supply, wide availability, and cost competitiveness when a carbon tax is attached to consumption of fossil fuels. And, if you compare nuclear power to coal use in terms of health and ecological effects, its record has been relatively good. Nevertheless, despite the fact that several major countries are considering closing the nuclear option, nuclear energy will likely play a prominent role in a low-carbon future. Yet several issues associated with nuclear power must be resolved, including siting, disposal of waste, design (modular versus large scale), operational controls, and risk communication.

The last pathway is the most problematic and involves reduction of the carbon emissions from fossil fuels. One approach would be to substitute lower-emitting fossil fuels, such as natural gas, for those that release higher levels of emissions. More problematic but still deserving of investigation is carbon capture and sequestration.

Indeed, the only responsible scenario in terms of achieving a low-carbon future involves following all four pathways simultaneously through a cost-effective mix.

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WILLOW POND: A CASE STUDY OF A LOW-CARBON, SELF-SUFFICIENT COMMUNITY OF 2050 By Bruce TonnBruce Tonn is a professor in the Department of Political Science at the University of Tennessee, a faculty associate with the Howard H. Baker Jr. Center for Public Policy, and a senior researcher with the Environmental Sciences Division of Oak Ridge National Laboratory.

My associate, Dorian Stiefel, and I created a case study of a fictional future development called Willow Pond, which, in 2050, is moving toward residential self-sufficiency. In 2000, Willow Pond was a typical sprawling U.S. subdivision and was wholly unsustainable. Flash forward to 2050. Residents have re-conceptualized Willow Pond as an entirely self-sufficient community devoted to the principles of sustainable development and responsive to a range of new technologies emerging in the fields of nano- and bio-technology, information and cognitive sciences, energy, and manufacturing. The typical home in this subdivision has an artificial intelligence system that controls the dwelling’s environment and provides for the comfort and convenience of its residents. Gone are traditional lawns that require mowing and inputs of fertilizers, herbicides, and pesticides. Instead, the community’s yards and green spaces create habitat for wildlife and produce biomass plants, which are composted to produce methane. Algae are used to produce hydrogen. All community members are connected to a central energy-production facility. These same technologies facilitate local manufacturing and production characterized by infinitely recyclable, reusable, and/or renewable products, including plastics, aluminum, glass, steel, and graphene. Local production also relies on reusable carbon LEGOs® and nano-yarns, wood, and transgenic silk. Automated assemblers structure the carbon LEGOs® into tables, chairs, houses, and other useful products, and automated dis-assemblers take them apart so that the components can be reformed into entirely new products. A bank of 3-D printers—essentially material fabricators—produces an array of durable consumer goods, including clothes, shoes, utensils, and electronics, so the community has little need to import manufacturing goods. Multi-tiered growing platforms housed in a centralized building produce Willow Pond’s fruits and vegetables. Within the food production facility, food, waste,

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and energy flows are closely linked, with outflows from one process providing the inflows for another. Community members travel in electric vehicles, and they are always connected to a pervasive telecommunications network—or cloud—that constantly conveys information via texts and holographic images as they move through the community. The telecommunications network also provides for real-time health monitoring, so community members benefit from preventive therapies.

Because Willow Ponds’ residents manufacture many of their own products, energy use in the residential sector does not decline significantly, despite the typical home’s range of energy-efficiency technologies. However, Willow Pond’s commercial sector consumes little energy because community residents produce most consumer goods, and there is little need for retail stores. Likewise, because most people work from their homes, instead of occupying office buildings, the business sector consumes very little energy, and energy demand for transportation has also declined. The community’s pervasive information technology provides for distance education and diagnostic medical services, further reducing the need for personal travel.

Most utopian communities have failed, and one of the main reasons for their failure is strained relationships. For that reason, Willow Pond will rely on the services of human facilitators to help ease tensions and resolve differences. Further, the community will need to establish rules and guidelines pertaining to property ownership, communal resources, and even personal liberties. Many difficult questions need to be addressed. For example, how best to address free-riders who take more than they give, poverty, and the certainty that some residents will become disabled and will be unable to meet their obligations to the community? With the widespread adoption of distance education, will there still be a role for public education? These and other issues raise questions about how self-sufficient a community can and should be and whether or not Willow Pond and similar communities are actually socially sustainable over the long term. On a larger scale, one can ask what impact will self-sufficient communities have on national and regional economies and culture and politics? These and other questions should guide future research.

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SIGNIFICANT SCIENCE BREAKTHROUGH SCENARIO By George CrabtreeGeorge Crabtree is senior scientist, distinguished fellow, and associate division director in the Materials Science Division at Argonne National Laboratory. He is also a distinguished professor of physics, electrical, and mechanical engineering at the University of Illinois at Chicago.

Energy is a basic human need, like food, shelter, and mobility. Access to energy, and the development of new technologies for harnessing energy to serve human needs including transportation, lighting, refrigeration, heating, industry, entertainment, and communication are prerequisites for a vibrant, interactive, and rapidly advancing global society. A new international energy landscape is emerging as developing countries create their energy infrastructures and as energy technologies move away from fossil toward more sustainable sources and uses. The timescale for significant change in this landscape is on the order of 50 years, as illustrated by the historical transitions from wood to coal, coal to oil, the rise of natural gas, and the advent of nuclear electricity. The kind of global energy landscape we achieve in 50 years depends on the research and development directions we choose to pursue now. These choices should be made strategically and deliberately to enable a vibrant, interactive, inclusive, and rapidly advancing global society in the future.

The energy outcomes needed for a vibrant, interactive and rapidly advancing global society are:

• Access to inexpensive, reliable, sustainable, and predictable supplies of energy,

• Stable climate,• An international market in energy that mediates across

countries, regions, and energy carriers.

These energy outcomes can be achieved by research and development in the following directions:

• Replacing high carbon-emitting coal and oil with environmentally safe, low carbon-emitting shale gas,

• Expanding the footprint of environmentally safe nuclear electricity,• Mineralization of carbon dioxide emissions to stable and benign

carbonate rocks,• Promoting electricity as a sustainable energy carrier by developing

electrical energy storage for transportation and the grid,

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• Transforming chemical fuel to a sustainable energy carrier by recycling its carbon dioxide and water outputs to fresh fuel using solar energy,

• Creating efficient transformation among the three basic energy carriers: light, chemical fuel, and electricity.

These research-and-development directions are chosen first for their powerful impact on society and second for the feasibility of achieving them. While many require significant discovery science and innovative technology, promising routes with significant potential are available for all. The 50-year time scale allows science to look well beyond safe incremental objectives; rather than waiting passively for serendipitous discoveries, science should identify and pursue the most valuable energy discoveries for the benefit of future society.

Shale gas and nuclear electricity are established energy technologies offering significant advantages of low carbon emissions compared to coal and oil alternatives, but they suffer from the threat of environmental harm from nuclear accidents, the long-term storage of spent fuel, and contamination of water and air by toxic chemicals. Science and technology have the capability to solve these environmental challenges through advanced materials for next-generation nuclear reactors, partial or full reprocessing of spent fuel to reduce storage requirements and enhance the finite nuclear fuel resource, and understanding and controlling the fracture and flow of fluids like gas, oil, and water in sedimentary shale and mesoporous rocks. The science solution, understanding and controlling the materials of these technologies, will raise their performance and reduce or eliminate their environmental risks, paying higher dividends than regulation alone, which adds cost without raising performance.

Mineralization of carbon dioxide to carbonate rock offers significant advantages over geologic carbon sequestration: carbonate rocks are thermodynamically stable, require no monitoring, are benign to the environment, and have the capacity to absorb the carbon emissions of all the fossil fuels remaining on Earth. The challenge of mineralization is slow reaction rates and passive surface coatings, addressable by catalyst development and surface modification. Electricity is a nearly sustainable energy carrier, efficient and environmentally benign once produced. Production can shift from coal to shale gas in the short term and to solar and wind in the long term. Electricity storage beyond lithium ion batteries can be developed to smooth the variability of wind and solar generation and to provide portable energy for transportation.

Chemical energy carriers like fossil and biofuels can be made sustainable by recycling their spent outputs, carbon dioxide and water, to fresh fuel using solar energy; the photochemical and photothermal routes for such regeneration are many and remain largely unexplored. An international

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market for energy, mediating across countries, regions, and carriers, requires not only societal and financial institutions but also technical discovery and implementation of inexpensive and efficient conversion routes among the three primary energy carriers: light (from the sun), chemical fuel, and electricity. Such interchangeability would add flexibility, diversification, and back-up options to energy markets that are now compartmentalized by region and carrier. Interchangeability among carriers makes energy a more conventional commodity, less geopolitical, and its access and price more predictable.

These energy research-and-development directions are bold, and the path to their realization is not yet fully defined, but promising opportunities exist for all. The 50-year time scale for changing the energy landscape allows room for transformational discovery, as the current shale gas boom demonstrates. All of these directions have the potential for similar breakthroughs, if opportunities are identified and pursued with strategic deliberation. The cost of scientific discovery is low compared to the cost of full-blown technology development and implementation, a basic feature that makes energy science a high payoff investment for society. Strategic pursuit of three basic energy outcomes—inexpensive, reliable, and predictable access to sustainable energy, stable climate, and an international market for energy that mediates across countries, regions and carriers—through the research directions outlined here will enable a vibrant, interactive, and rapidly advancing society in 50 years.

THE WORLD IN 2050 AND THE NEW WELFARE SCENARIO By Carlo SessaCarlo Sessa is director of the Institute for the Studies for the Integration of Systems in Rome, Italy.

The PASHMINA (paradigm shifts modeling innovative approaches) project grew out of the need to improve our understanding of the paradigm shift in the energy transfer-and-use nexus and, more broadly, of

world development. For this project, we focused on the interaction between economic and ecologic systems. In projecting the world in 2050, we characterized future growth in four directions: growth without limits, growth within limits, stagnation, or the new welfare. Growth without limits is marked by little care for social welfare or the environment and increased consumption of mass-produced goods. Growth within limits reflects balanced growth and globalization working toward climate goals with a uniform top-down approach. Stagnation reflects an individualistic approach marked by intense competition, but little cooperation,

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little care for the environment or human welfare, and slow growth or decline, characterized by less mass consumption.

The preferable scenario reflects movement toward a new welfare, which is characterized by a high level of cooperation, heightened concern for the environment and social welfare, and an increased share of immaterial consumption. Under this scenario, the current growth-without-limits paradigm becomes unsustainable because of limited resources, and development of new technologies will not be sufficient to resolve the issue of diminishing resources. In the new welfare scenario, GDP as a measure of growth is obsolete and will need to be replaced with ways of measuring progress that are more reflective of natural, human, and social capital. Further, this scenario imagines room for new forms of self-regulation of common resources.

Under the new welfare scenario, there will be reduced consumption of material goods and increased consumption of services and intangibles. The economics of “enough” will prevail as the dominant paradigm. The world will see a transition from unequal growth to prosperity in a multi-polar, globally interdependent world.

Among other shifts likely under this scenario is a reconceptualization of production, from short-lived to longer-lasting goods and from private to open source knowledge products and services; growth in recycling and zero-waste processes; and a shift from profit-driven business to entrepreneurship that seeks to satisfy social needs and build local capital. A paradigm shift will also occur in the form of government. New global democracy networks and institutions will be created, and constitutions will go beyond protecting human rights to the recognition of “nature rights.” Citizen income will be tied to duties in service of the social welfare and participatory governance.

The new welfare scenario also charts a pathway toward a low-carbon future, with an overall reduction in energy consumption, density, and intensity and a greatly reduced reliance on fossil fuels. A new, smart electric grid will facilitate active demand management and decentralized production of power. Natural gas or even small nuclear plants will resolve problems associated with the intermittency of renewable energy sources.

Under this scenario, carbon pricing is created at the global level, and an international climate trust will provide funding for investment in mitigation and adaptation strategies to contend with climate change.

So what will the world of 2050 look like, if we achieve the new welfare scenario? We will see slowed population growth, an increase in lands devoted

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to production of bioenergy feedstocks, less demand for travel, a significant decline in greenhouse gas emissions, a significant decline in loss of biodiversity, and increased social awareness of environmental issues.

Actions necessary for the shift to the new welfare paradigm include creation of new metrics for measuring progress, growth in public acceptance for technological and societal change, creation of new global and local institutions devoted to sustainable management of shared environmental resources, sustainable production and consumption patterns, and low-carbon energy and transport systems.

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AGENDA United States and European Union Summit on Science, Technology, Innovation, and Sustainable Economic Growth

“Visions of Sustainable Economic Growth: A Transatlantic Dialogue on Energy, Water, and Innovation”

The U.S.-E.U. Summit’s Final Plenary SessionConvened at the Woodrow Wilson International Center for Scholars in Washington, D.C., September 11, 2012

8:30 Welcome: The Honorable Jane Harmon, Director, Woodrow Wilson International

Center for Scholars Lee Riedinger, Director, Bredesen Center for Interdisciplinary Research

and Graduate Education, University of Tennessee and Oak Ridge National Laboratory

9:00 Toward a Stronger US-EU Dialogue on Sustainable Economic Growth Domenico Rossetti, European Commission

Robert Shelton, Howard Baker Center

9:30 Panel Discussion of Major Science, Energy, Water, and Carbon Issues Over the Next 30 Years in Europe and the US:

Moderator, Paul Peercy, University of Wisconsin

Electricity and Energy Efficiency: Marilyn Brown, Georgia Tech University

Transportation: David Greene, Howard Baker Center and Oak Ridge National Laboratory

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10:30 Coffee Break

11:00 Panel Discussion (Continues) Water and Energy: Geoff Dabelko, Woodrow Wilson Center

Sources of Conflict over Energy Resources During the Next 30 Years: Philip Andrews-Speed, University of Westminster, United Kingdom

12:00 Lunch: The Honorable Bart Gordon, Partner, K&L Gates, and former Chairman of the House Committee on Science and Technology

1:30 Panel Discussion of Possible Low Carbon Futures Over the Next 30 to 50 Years in Europe and the United States

Moderator, James Roberto, Oak Ridge National Laboratory

Steady Progress Scenario: Bertrand Château, ENERDATA, France

Accelerated Technology/Manhattan Project Scenario: Milton Russell, Institute for a Secure and Sustainable Environment, University of Tennessee

Decentralized Scenario: Bruce Tonn, Howard Baker Center and Oak Ridge National Laboratory

3:00 Coffee Break

3:30 Panel Discussion (Continues)

Significant Science Breakthrough Scenario: George Crabtree, University of Illinois and Argonne National Laboratory

Beyond GDP: the Global Interdependence and Reduction of Inequalities scenario: Carlo Sessa, ISIS, Italy

4:30 Concluding Observations: Kent Hughes, Woodrow Wilson Center

4:45 Final Report on Summit: Domenico Rossetti and Robert Shelton

5:00 Reception

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UNITED STATES AND EUROPEAN UNION SUMMIT ON

Science, Technology, Innovation, and Sustainable Economic Growth