On Proliferation, Climate, and Oil: Solving for Pattern  

Posted by Big Gav in

Amory Lovins has an article in Foreign Policy on how to solve the myriad problems associated with fossil fuel consumption - On Proliferation, Climate, and Oil: Solving for Pattern.

The problems of proliferation, climate change, and oil dependence share both a nuclear non-solution that confounds U.S. policy goals and a non-nuclear solution that achieves them.

The first four months of 2010 offer a unique opportunity to align the United States' foreign-policy goals with domestic energy policy and new market developments, and thereby to stem what the Pentagon's Nuclear Posture Review will reportedly rank equally with great-power threats -- the spread of nuclear weapons.

Epistemologist Gregory Bateson and farmer-poet Wendell Berry counseled "solving for pattern" -- har­nessing hidden commonalities to resolve complex challenges without making more. President Obama's speech at the recent U.N. climate summit in Copenhagen hinted at such an approach by linking an efficient, clean-energy, climate-safe economy with three other key issues: prosperity, oil displacement, and national security. Keeping proliferation, climate, and oil in separate policy boxes has in the past stalled progress on the first two issues over North/South splits that the third issue intensifies. Yet these three problems share profitable solutions, and seem tough only because of a wrong economic assumption.

One false assumption can distort and defeat policies vital to paramount national interests. The Copenhagen climate conference proved again how pricing carbon and winning international collaboration are hard if policymakers assume climate protection is costly, focusing debate on cost, burden, and sacrifice.

That assumption is backwards: Business experience proves climate protection is not costly but profitable, because saving fuel costs less than buying fuel. Changing the conversation to profits, jobs, and competitive advantage sweetens the politics, melting resistance faster than glaciers. Whether you care most about security, prosperity, or environment, and whatever you think about climate science, you'll favor exactly the same energy choices: focusing on outcomes, not motives, can forge broad consensus.

For instance, a January 2009 study by McKinsey & Company demonstrated how it was possible to cut projected 2030 global greenhouse-gas emissions by 70 percent at a trivial average cost: $6 per metric ton of CO2. Newer technologies and integrative design, which often makes very large energy savings cost less than small or no savings, turning diminishing into expanding returns, could make even bigger abatements cost less than zero­ dollars.

This can be done fast enough. Consider that from 1977 through 1985, U.S. oil intensity (barrels per real GDP dollar) fell 5.2 percent per year. Today, cutting global energy intensity at an annual rate of about 3-4 percent, vs. the historic 1 percent, could abate further climate damage. The United States has long achieved 2-4 percent cuts each year without paying attention; China achieved more than 5 percent reductions from 1976 through 2001 and is on track for 4 percent reductions from 2005 through 2010. Individual firms have been able to achieve 6-16 percent reductions. So why should 3-4 percent be hard, especially with most of the global economic growth in China and India, where making new infrastructure efficient is easier than fixing it later?

Since energy efficiency consistently makes money (billions for many firms), why should this be costly? And why should climate negotiators adopt economists' assumptions about cost rather than business leaders' experiences of profit? The climate conversation gets vastly easier and less necessary when it's shifted from shared sacrifice to informed self-interest.

Many policymakers likewise assume U.S. oil dependence and imports must be permanent. Yet a 2004 Pentagon-cosponsored independent study showed how it was possible to eliminate U.S. oil use by the 2040s at an average cost of about $15 per barrel, led by business for profit. Implemen­tation was launched in 2005 by "institutional acupuncture," then spurred by the 2008 price shock, 2009 policy shifts, and military innovation.

That effort now looks to be on or ahead of schedule: In 2009, "peak oil" emerged, but on the demand side. U.S. gasoline demand reached its apex in 2007. Cambridge Energy Research Associates doubts OECD oil demand will regain its 2005 peak. Deutsche Bank forecasts light-vehicle electrification (at one-third China's planned rate, and without counting the other revolutionary innovations underway) will turn world oil demand downward from 2016 -- reaching, by 2030, 8 percent below 2009. Suburban sprawl is reversing. Just in 2008, government-mandated "feebates" cut inefficient cars' sales in France 42 percent and raised efficient cars' sales 50 percent. Thus oil is becoming uncompetitive even at low prices before it becomes unavailable even at high prices.

Yet with oil as with climate, official assessments ignore these solutions as too detailed, disruptive, novel, or integrative to contemplate. When offered cramped old choices, policymakers all too often perpetuate largely incremental policies. Private firms are more likely to innovate, while governments play catch-up. And intergovernmental negotiations learn slowest of all.


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