university of otago department of physics eman 410 energy management, 19 september 2008 energy and...
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University of Otago Department of Physics
EMAN 410 Energy Management, 19 September 2008
Energy and long-term sustainable
development in New ZealandDr John Peet
… How could we make NZ more Unsustainable ……?
• Paramount national goal – economic growth
• Fossil fuel use – increasing• Greenhouse gas emissions –
increasing• Carbon neutrality target – going
backwards• Transport fuel use – more
motorways, airport extensions, more airliners
• Water abstraction and use – growing
• Rivers – depleted and polluted• Rich/Poor gap – widening• Housing affordability –
decreasing
• Industry – moving overseas• Debt - heavy and increasing
(especially overseas debt)• State of the Environment 2007 –
not good• Soil erosion – continuing• Forests – conversion to dairying• Ruminant animal numbers -
increasing• Biodiversity – trying hard but
arguably losing• Pests - possums, rabbits, stoats,
wilding pines – no improvement• Population policy (… what
population policy…?)• etc……etc……etc…..
A Caution …..
“It ain’t so much the things we don’t know that get us into trouble. It’s the things
we know that just ain’t so.”
Artemis Ward (Charles F Brown) late 19th Century
Strong and Weak Sustainability
• Weak Sustainability – human-made and natural capital are substitutable
• Strong Sustainability – human-made and natural capital are usually complements, not substitutes
• Absurdly Strong Sustainability – human-made and natural capital are not substitutes, and little or no technological progress in the future is possible.
Related standpoints to take into account:
• Oikonomia (Economics)– Management of the household
• Oikologia (Ecology)– Nature’s household
• Oikumene (Ecumenism)– The inhabited earth/known world,
considered as a whole
SO … what is to be sustained in sustainable development?
Two very different answers to this question (Daly, 2003):
1. Utility should be sustained. In practice, surrogates such as Consumption are commonly used, expressed as dollars per capita spent on goods and services. (Weak sustainability position)
2. Physical throughput should be sustained, so that the throughput of resources available to future generations is no less than at present, i.e. Natural Capital is kept intact. (Strong sustainability position)
Then just what is the problem?
• If Utility depends upon Consumption of goods and services, and if
• Consumption presupposes Production of those goods and services, and if
• Production requires transformation of Resources taken from the Environment, (i.e. that to which value is added),then
• The relationship between resource use, transformation processes and consumption is central to the ability to achieve SD.
HouseholdEmployer/
Firm
Pays money
Receives income
Receives goods/services
Provides labour
Goods &servicesmarkets
$
Labourmarkets
$
The circular flow model of macroeconomics
and the place of markets
Circular flow economic model of the NZ economy
In ves to rH o u se ho ld s
W o rke rH o u se ho ld s
E m p lo yer s/F irm s
W ages/Sa lariesDividends
Rein vested Profit
Savin g Consum p tion
G o vern -m e nt
F in an c ia lIns titu tion s
G o v t s p e n d i n g
In c o m eT a x
B e n e f i tsB e n e f i tsB e n e f i ts
Rest of the World
TotalSpending
GrossIncome(GNP)
Exportearningsprofits
Paymentforimportsinterestetc.
Investmentlending
GST
NetIncome(GDP)
Economics - 1
NZ data 2005After Gowdy, 2006
The papereconomy
per person per year
GDP $34955
Labour $14,804 Surplus $15,754 Taxes $4,396
GNE $35429
Consumption Private $20596 Govt $6321
Capital $8217
How to develop policy that addresses the whole issue of
sustainable development coherently, rather than just one or more parts,
incoherently?
I start from the position enunciated by Ernest Rutherford many years ago:
“All science is either physics or stamp collecting”
Relevant lessons from Physics:
• F = ma
– Newton’s First Law of Motion (1680s)
• dS/dT ≥ 0
– The Second Law of Thermodynamics (the Entropy Law) (Carnot, 1824,
Clausius, Thomson, Gibbs etc, 1860/70s)
• e = mc2
– Einstein’s Mass-Energy relationship (Relativity - 1904)
• iћ ∂Ψ/∂t = HΨ
– Schrodinger Equation (Quantum Mechanics - 1926)
Treasury opinion (around 1988) in relation to moving the then Ministry of Energy functions into a section
of the Ministry of Commerce:
“4 The key issue in both the Policy Framework for Energy Management and the Strategic Business Plan is whether or not energy is sufficiently different to other goods and services to justify a specific energy policy ….. We consider that although energy is both essential and strategically important, it is not unique in these attributes.”
Investor
Households
Worker
Households
Employers/Firms
Wages/SalariesDividends
Reinvested Profit
Saving Consumption
Govern-ment
FinancialInstitutions
Investment lending
Net Income
Govt spendingGST
IncomeTax
BenefitsBenefitsBenefits
Expenditure
GDP
RAW RESOURCES
POLLUTION
RawEnergyResources
EnergySector
Goods & Services – Energy & Matter
Useful
Inputs
Useless
Waste
InvestorHouseholds
WorkerHouseholds
Employers/Firms
Wages/SalariesDividends
Reinvested Profit
Saving Consumption
Govern-ment
Financial
Institutions
Investment lending
Net Income
Govt spendingGST
IncomeTax
BenefitsBenefitsBenefits
Expenditure
GDP
RAW RESOURCES
POLLUTION
RawEnergyResources
EnergySector
Sun
OuterSpace
Ecosystem services
ENERGY & MATTER
ECOSYSTEM
The Real (biophysical) Economy
Hall & Klitgaard, 2008
Energy Transformation System
Net EnergyThere is a net flow to The economy if, and only if, E is greater than F, or if E/F is greater than 1.
E/F is the Energy Return on Investment, EROI
Some current EROI data
• Global oil EROI roughly 26:1 in 1992, about 19:1 in 2005• Running average EROI for US domestic oil dropped from
about 100:1 in 1930s to about 12:1 today• Oil used within the US for products exported to import oil
had an EROI about 30:1 in 1970, about 20:1 in 2005• Ethanol from corn EROI in the US is at best 1.6:1 and at
worst less than 1:1 (Brazilian cane ethanol around 7 or 8:1)• Biodiesel EROI around 3:1• Oil shale EROI around 6:1• Tar sands EROI around 1:1• Coal liquefaction EROI around 3:1• Nuclear debatable but around 5 – 15:1• Wind energy EROI around 15 – 20:1
Data from Hall et al, 2008 and Cleveland, 2008
Consequences of the transition to lower EROIs
Irrespective of which resources and technologies are used, lower EROI values mean that, to maintain anything like current outputs of liquid fuels (for example), much higher levels of investment and maintenance than in the past will be needed.
The energy and resource requirements will mean less economic output available for consumption, especially discretionary consumption.
Energy in the Economy
Hall, Powers & Schoenberg, 2008
A possible (post Peak Oil) future?!
Economics - 2
Thebiophysicaleconomy
per person per year
Petroleum 1.12 t Coal (net) 0.72 t Gas 38 GJ Water 470 t Aggregate 11 t
Greenhouse gases18.6 t
Solid waste 0.55 t Sewage 117 t Biodiversity loss,
erosion etc.
NZ data 2005, 2006, 2007After Gowdy, 2006
Questions relevant to Sustainable Development
• Are people satisfied and happy?– (sufficiency and equity)
• Can more well-being be achieved with less throughput?– (efficiency of the transformation
process)
• Are ecosystems healthy, resilient and thriving?– (environmental sustainability)
The Daly Rules (1990)
• The Output Rule– wastes ... should be kept within the
assimilative capacity of the local environment:
• The Input Rule– for renewables - harvest rates of
renewable resource inputs shall not exceed the regenerative capacity of the natural system that generates them.
– for non-renewables - depletion rates shall equal the rate at which renewable substitutes are developed by human invention and investment.
“Resource efficiency”
is the answer?
The IPAT equation
Total Social Impact = Population x Affluence x
Technology Impact
or I = P x A x TWhere I = impact
P = people A = GDP/people T = Resource use/GDP
A (very) simple example
X X
=
P A T
I
0
0.2
0.4
0.6
0.8
1
1.2
1 30
Population
0.000
0.500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
Affluence
0.000
0.200
0.400
0.600
0.800
1.000
1.200
Technology
C o n s t a n t 5 % p e r a n n u m 1 0 % D V t o 1 / 4
T i m e s p a n 3 0 y e a r s
Social Impact
0.000
0.200
0.400
0.600
0.800
1.000
1.200
1.400
Peak Oil & Climate Change
• Geology and Physics tell us that Peak Oil is close or already reached - and because of Climate Change we must reduce our net CO2 emissions anyway
• Two radically different views framing the current debate:– Economics and Politics – “transition to alternatives”
view. Result: biofuels, liquid fuels from coal, carbon capture & sequestration etc.
– Ecology and Physics – “energy descent” view.
• Blind faith in the market looks unwise, so …– Chart a new course for the rest of the 21st Century?– Could “Contraction and Convergence” or “Power
Down” be better options?
Peak Everything?
The real issue, it can be argued, is not so much Peak Oil alone, as it is
Peak Consumption of Stuff!
(e.g. Richard Heinberg’s “Peak Everything”, 2007)
Timescale for sustainability?
• Jericho is about 10,000 years old• Athens is about 7,000 years old• Damascus is about 5000 years old• London is about 2,000 years old
• (timescale for mainstream finance and economics – at most, maybe 5 – 10 years, often only a few months, or even a few days!)
• (….. And your timescale…..?!)
My timescale!
We cannot know what technologies we will have available to us even 100 years into the
future. We can, however, make some commonsense assumptions to guide sustainability thinking. These include:
• Humans will be here• Most current cities will be here• Food will be grown• Materials and energy will be required• Human basic needs will not have changed• We will not have Star Trek technology!
Responses to Limits to Growth (1972)
• “With current and near current technology, we can support 15 billion people in the world at twenty thousand dollars per capita for a millennium – and that seems to be a very conservative statement” Herman Kahn
• “The material conditions of life will continue to get better for most people, in most countries, most of the time, indefinitely. Within a century or two, all nations and most of humanity will be at or above today’s Western Living standards.”
Julian Simon
Limits to Growth?
Meadows, Randers, Meadows“Limits to Growth: The 30-year Update”, Figure 4-11 Scenario1: A Reference Point
(cf Figure 35 in (original) 1973 Edition)
2008
In the mainstream (neoclassical) economic approach, a primary
purpose of the economy is to achieve efficient allocation of resources.
The REAL economic problem may be rather more complex (Daly 2003) :
• “A good allocation of resources is efficient (Pareto optimal);
• a good distribution of income or wealth is just (a limited range of acceptable inequality);
• a good scale does not generate “bads” faster than goods and is ecologically sustainable.”
Economics - 3
The (invisible)social
economy
Voluntary work Unemployed Retired Children Gift work Mahi
Children in poverty Elderly in poverty Median income
people Rich-poor gap Social cohesion
“Yes, our new screen IS larger, but I stilldon’t feel we’re getting the big picture.”
“Complex systems such as governments and large
institutions are more like frogs than bicycles” A Mant “Intelligent Leadership”,
1999• One can take a bike to bits, clean
and oil it, inspect and service the parts and reassemble it, confident that it will work as well as before
• One cannot treat frogs like that!
Reminder …..
“It ain’t so much the things we don’t know that get us into trouble. It’s the things
we know that just ain’t so.”
Artemis Ward (Charles F Brown) late 19th Century
• “For every human problem, there is a neat, simple solution, and it is always wrong”
H.L.Mencken
“It is better to be approximately right than precisely wrong”
Warren Buffett
“It is better to deal incompletely with the whole than wholly with the incomplete”
Herman Daly
“Pray to God, but row away from the rocks”Hindu proverb
Systems thinking guidelines:
Shifting MindsetsGrowth is always good.Markets alone can solve all problems.
We are separate from nature.
Problems are caused by the behaviours of “others”.
We exist in a world of limits.Markets don’t measure everything
that is important.We are an integral part of nature.Often the structure of systems
causes problems.
Percent of people accepting
Dominant Mindset Emerging MindsetTime
Copyright, 2001 -- Sustainability Institute
The Earth Charter is probably the best and most comprehensive currently-
available set of basic values to provide an ethical foundation for a 21st Century
mindset. “We must join together to bring forth a
sustainable global society founded on respect for nature, universal human rights, economic
justice, and a culture of peace.” www.earthcharter.org and www.earthcharter.org.nz
A final (?) caution ….
"It has often been said that, if the human species fails to make a go of it here on Earth, some other species will take over the running. In the sense of developing intelligence this is not correct. We have, or soon will have, exhausted the necessary physical prerequisites so far as this planet is concerned. With coal gone, oil gone, high-grade metallic ore gone, no species however competent can make the long climb from primitive conditions to high-level technology. This is a one-shot affair. If we fail, this planetary system fails as far as intelligence is concerned. The same will be true of other planetary systems. On each of them there will be one chance and one chance only."
cosmologist Fred Hoyle