Climate, Coal and the Car of the Future
Joseph Romm, Executive Director, Center for Energy and Climate Solutions

David Nissen: Thanks to Abby Joseph Cohen for framing the energy issues, and for pointing out how advanced the consciousness in financial markets and management practices are in the real world, especially in comparison, I just have to say this, to the degree to which our current government in the United States has failed to engage this discussion.

Transportation is a big part of development and growth. It connects economic activities, it allows the exploitation of specialization and comparative advantage and returns to scale. And it is a big piece of the consumption budget in places, especially in Asia, where the growth in Asian demand in 2004 provoked a fundamental change in the perception of the state of oil markets going out, and was a contributing factor to the fact that the forward curve for oil, the out year price has doubled in the past less than twenty-four months. Transportation is key to development. The modalities of transportation are key to sustainability. Our next speaker, Joseph Romm, is Executive Director of the Center for Energy and Climate Solutions, a one-stop shop helping businesses and states adopt high leverage strategies for saving energy and cutting pollution. He's author of the National Commission on Energy Policy's report “The Car and Fuel of the Future,” and the book, “The Hype About Hydrogen: Fact and Fiction in the Race to Save the Climate.” He has held high positions in the Department of Energy, implementing the ideas in these areas. He holds a Ph.D. in physics from MIT. Joseph Romm will speak on Climate, Coal and the Car of the Future., and I'm going to watch with amazement while he deals with this is twenty minutes. Joe Romm.

Joseph Romm: Thank you very much. I greatly appreciate being invited here. I'm a native New Yorker, born and raised actually Middletown, New York, and have been doing sustainable development for a long time, pretty much since 1988 when I came to work for Peter Goldmark at the Rockefeller Foundation and then actually taught a class here at SIPA as an adjunct for two years, rethinking national security, and then I went to work with Amory Lovins for a couple of years as I became convinced that clean energy was going to be the nexus of a lot of issues, and then five years with the Clinton Department of Energy helping to run the Office of Energy Efficiency and Renewable Energy, and then most of the last seven or eight years working with companies on greenhouse gas reductions and sustainable development, and have come to one conclusion about sustainable development, which is that sustainable development is a lot like teenage sex, everybody says they're doing it but they're not, and those who are doing it aren't doing it very well.

And I used to give most of my talks on the solution side of things, but really have come to understand that it's as much that people don't understand the cost of inaction as the failure to understand how low the cost of action would be. The central question of the conference is sustainable development feasible. I think there's no question to that is yes. The question is it going to happen, I pose the answer probably not, and the reason why not is we're not trying, and I hardly ever accomplish things that I don't try to do. And since the nation and the world isn't trying now to develop sustainably it's hard to see how that's going to happen.

What does unsustainable development look like? I post Katrina New Orleans as one example. What does sustainable development look like? We don't know since we've never done it anywhere. I will say that my brother lost his home in Katrina. He lived in Pass Christian which got a thirty-foot seawall and fifty-five foot waves. And one mile inland where he lived his house was inundated with twenty-two feet of water, which really got me spending a lot more time talking to climate scientists and going back to some of my roots as a physical oceanographer, because I do think that the situation, the dire nature of the situation, is much graver than most people realize. As a former professor here I am happy to assign readings, and I certainly would urge people to read the entire Time magazine cover story on global warming, “Be Worried, Be Very Worried,” and I would probably add another “very” to that. And I think it's certainly humbling coming here where you have James Hansen who is certainly the leading climate scientist I think in the country, and who has been the bluntest about the reality that this country faces.

I think the basic thing to realize is that most warming goes into the oceans and poles. And when you warm up the oceans you create more heat and energy for hurricanes. So the hurricane season of 2004 and 2005 are going to become the norm in this country over the next ten or twenty years. I think the slightly longer term issue is that if we don't take any action on sustainable development and climate for the next ten years, at least from Hansen's point of view, and many of the people I've talked to you cross the point of no return for Greenland melting, which is twenty feet of sea level rise. And if you wait another ten years after that you're probably going to see west Antarctica melting, and that's another twenty feet. And then the only question is how fast. And the people who used to think that it was 1,000 years thought that because they thought the only way the ice sheets could lose mass was by melting, and it's very clear the ice sheets can just disintegrate. And Hansen and others think that this could happen a foot a decade. And I think over the next several years that will become clearer. And by the end of this century the United States would be nine degrees Fahrenheit warmer, and we might see several feet of sea level rise, but more important would be the rate of sea level rise, and this would be a very, very different country. And the science is certainly settled. I commend people, Hansen's April 2005 in Science, “There can no longer be any genuine doubt that human made gases are the dominant cause of observed warming.” And the reason I go through this is just that it's very important to connect the climate science with the difficulty of reversing our energy trends. We're at carbon dioxide levels not seen I guess for about ten to thirty million years, and that creates an energy imbalance, because carbon dioxide traps the heat that comes from the Sun. Restoring balance, and this is sort of the critical point, pre-industrial levels of greenhouse emissions were about 280 parts per million, and we're at about 380 now. They keep going up as long as global emissions aren't cut by maybe 60 to 80% from current levels. If we just stop increasing emissions today concentrations would keep going up. It's the single thing that I think people don't realize. We're going to have to by mid-century cut CO2 emissions 60 to 80% or else we're going to face twenty to forty foot sea level rise and the ruination of this country. Again, that's 60 to 80% from current levels, so the United States by 2050 is going to see 50% more people and a doubling or quadrupling of GDP. The average car on the road, for instance, is going to have to use one-quarter or less of the gasoline, it's going to have to use one-quarter or less of the CO2 by 2050. And so the reason I just reiterate all this is that the CO2 constraint ultimately has to drive all of energy policy, all environmental policy, and all economic policy in this country, which it doesn't, it's not even a first tier issue inside the beltway where I live. So the entire world is going to change radically sometime over the next ten or twenty years when this dawns on people. We have to cut fossil fuel and fast. Now we're going in the opposite direction, which is why I throw coal in the title.

This is new coal builds by decade from the International Energy Agency. 221 gigawatts the rest of this decade, another 500 gigawatts the decade after that, another 670 gigawatts the decade after that. The total power in the US is 800 gigawatts, and about half that is coal, so we're adding a lot of coal plants. These coal plants, the coal plants built between 2003 and 2030, projected, in the world will emit over their lifetime as much carbon dioxide as every piece of coal that has been burned since the dawn of the industrial revolution. This is unsustainable development, and unfortunately actually the 2003 to 2010 numbers may be low, because China is building coal plants at an obscene rate. And it will be incumbent upon us and China to either dramatically reverse course here, or together I think ruin the climate.

On the oil issue it's pretty clear the era of easy oil is over. Demand growth is just unrestrained in China, India, in the US. World oil supply discoveries are decreasing. Global non-Saudi reserves are very modest. But I think the key point from the climate point of view is that a lot of people are expecting to be rescued by unconventional oil. Unconventional oil basically is really bad for the climate. Canada is now getting a million barrels a day from the tar sands. The tar sands you have to waste a lot of natural gas heating them up to turn them into oil. So instead of exporting natural gas to us to displace coal plants, they are wasting it making carbon intensive liquid fuels. It is a really, really bad idea. They're planning to go to three to five million barrels a day over the next ten to twenty years. Many people in this country are talking about cold oil, probably the single worst possible idea ever conceived of from the point of view of global warming. So we're going to end up in this very nightmarish situation over the next ten to twenty years when the constraints of the world oil supply are going to run into the climate constraints. And there's no question that we are in an era of permanent oil shocks where running up over $100 a barrel on a periodic basis is going to be inevitable. And this drives rather inevitably if you want to deal with climate you have no choice, you have to deal with coal and cars.

We have to minimize new coal builds. We can't build that many coal plants over the next twenty-five years or else there is no solution to climate change. So we have to do as much energy efficiency as possible, we have to do as much renewables as possible. I'm not a big fan of nuclear, but it's better than coal. Coal gasification plus carbon capture is certainly an important idea. We're not trying hard enough on it. And we need to have a carbon dioxide price soon.

And the way you can tell the difference between people who are serious about global warming and people who just use the rhetoric that they're serious about global warming are the people who want to have a cap on carbon dioxide emissions now so that industry and the private sector can act accordingly, and those who just want to keep spending money on technology.

In the car realm the strategy writes itself. The average car on the road in the United States is twenty miles per gallon. If the average car on the road in 2050 is not eighty miles per gallon equivalent then we're going to have catastrophic climate change, so you have a two-phased strategy. I don't see any escape from it. We have to push very hard on fuel efficiency, and then you need a low carbon dioxide alternative fuel. And industry is going to have to deliver these cars, but the cars can only be brought to us by government regulations. There is no country in the world that has ever reduced oil consumption without a government mandate of some sort, either high taxes in Europe, ethanol mandates in Brazil, or fuel economy standards in this country. Business by itself can't solve this problem. If the government sets up the right regulations and corrects the price of energy to reflect its damage to the climate then you can solve the problem.

Since I've written a whole book, “The Hype About Hydrogen,” which you can buy online I won't go into a lot of detail on it. The people who believe that hydrogen is any possible solution to global warming haven't read my book and they haven't done pretty straightforward analysis. It is exceedingly unlikely we would see significant number of hydrogen cars just as a practical matter for many decades. I have this line here from the head of Toyota's advanced technology group on when hydrogen would replace gasoline. “If I told you never would you be upset?” Jim Woolsey, former CIA Director, has read my book so he just has a very short six word, nice pithy message on hydrogen that he was on a panel discussion with me. “Forget hydrogen, forget hydrogen, forget hydrogen.” I'd be happy to take questions on that. The short answer for why you can forget hydrogen is hydrogen is just an energy carrier, you have to make it from something. Anything you could make it from, like natural gas or renewable electricity, you need to displace coal. You can't divert it to make hydrogen and to run into a car. A car have got to focus on fuel economy for the next two decades, and then on more plausible alternative fuels than hydrogen.

I won't go into a lot of detail on why we don't drive alternative fuel vehicles today, but there are a lot of barriers. The State of California, the federal government, most countries have been trying very hard to get people to drive alternative fuel vehicles, and with the exception of Brazil nobody's done it. The vehicles cost more, the fuel is hard to store, the fuel costs more, you don't have any fueling stations, etcetera, etcetera. So it is a very hard thing to do, and another article I will commend to you is the current issue, the April issue, of Scientific American, I have an article with Andy Frank on hybrids and plug-in hybrids, which I'll talk about just a little bit in my remaining time.

Let me make the following point about hybrids, of which I am a big fan, and I'm sure many of the people in the audience own them. For the last twenty-five years engines have gotten much more efficient. Automotive technology has improved dramatically. The average fuel economy of the vehicle fleet has stayed flat, because all of the engine technology has been used for heavier vehicles and faster acceleration, reduce zero to sixty time. Sadly, the same exact thing can happen with hybrids. Hybrids are not going to solve the global warming problem unless government mandates that hybrids be used to solve the global warming problem. You're going to have to have fuel economy standards or else you're just going to see hybrids used to acceleration and weight. So I think that's just a key point. There's no pure techno-fix here. With the right incentives industry can solve the problem. With the wrong incentives the problem never gets solved.

And every other place but the United States realizes, the State of California has tried to introduce tailpipe CO2 efficiency standards, China has put in taxes for inefficient vehicles, most of the countries that have ratified Kyoto have put in standards. So job number one for the next two decades in a two-phase transition is fuel efficiency. But the key point to realize is again, we need to have a 50% cut in absolute US CO2 emissions by 2050, even though we're going to have 50% more people. So it's easy to do the math. Efficiency alone might stop CO2 from rising, but if you want to cut CO2 you're going to have to dramatically reduce the carbon intensity of the fuel you use to drive your car. And it's not going to be hydrogen, it's going to be one of two other fuels. I mean there's really only three fuels that people seriously consider, hydrogen, ethanol and electricity. And it's not going to be hydrogen. Cellulosic ethanol, which is ethanol not made from corn. General Motors is running these ads, “Live green, go yellow,” claiming that ethanol made from corn reduces greenhouse gas emissions. The literature says it doesn't, so I'm going to describe GM's ad campaign as yellow-washing. If GM were interested in reducing greenhouse gas emissions it wouldn't be spending millions of dollars lobbying the federal government to stop higher fuel economy standards in this country. So GM isn't interested in reducing greenhouse gas emissions, they're just interested in seeming like they are. They were quite annoyed that Toyota got all this credit for hybrids when GM was trying to convince people that hydrogen was the future. So I'm a very big fan of cellulosic ethanol. The President finally got around to talking about it in his 2006 State of the Union Address.

I do think, and this is what I think the car of the future is, and again this is laid out in a little more detail in the Scientific American article. Once you make the transition to hybrids, which I think is a very good idea, then every car on the road has an electric battery and an electric motor. The next obvious thing to do is to put in a battery that can take a charge from the electric grid, so that you could run maybe twenty miles all electric before you revert to a regular gasoline hybrid. The reason you'd want to do that is gasoline engines are very inefficient, electric motors are incredibly efficient. The annual fuel bill of running on electricity is about one-third that of running on gasoline. It's only been the first cost of the battery that has been the disincentive, and the fact that people originally thought we were going to have pure electric vehicles that required a lot of batteries, and that scenario doesn't work. But just going twenty miles all electric can get you very far since most people don't actually travel very far every day.

Let me just say on the CO2 side that a plug-in hybrid is the most climate friendly car, because even today with the US grid the way it is, a plug-in hybrid running on electricity has half the emissions of gasoline. But if we cap CO2, which we certainly will do in ten years, then in fact you're displacing CO2 emissions from gasoline into the electric sector, which as I say, is going to be capped. And I'll just mention in passing that you can go four times as far on a kilowatt hour of renewable electricity in a plug-in hybrid as you could in a hydrogen car. And again, most people you drive to work, you park your car for work at…

…the key message is technology by itself can't possibly solve the global warming problem.

Let me just return briefly to the endgame of climate. I urge people again in the reading assignment mode, it's been mentioned already, the paper by Socolow and Pacala in Science, “Stabilization Wedges.” I think sometimes people misinterpret this, they just put up a slide and say, “Oops, the problem's solved.” I read the paper almost the exact opposite. The point of the paper was existing technology can solve the global warming problem. I read it in the reverse. New technology can't possibly solve the global warming problem. You start now doing these things. If you wait too long it's too late. The point of their paper was if you started in 2005 doing seven of these wedges you could stabilize at under 550 parts per million, under a doubling. If you wait until 2020 to 2025 to start eight of these wedges we're probably going to triple carbon dioxide emissions. You can't start these in 2025. And so whatever version of these you like you start now or else the climate ends up getting ruined.

So let me just put my last slide up. What's going to happen in the future? In the future I think gasoline prices are basically going up. We might see some dips, but by 2020 we're going to be above $3 permanently. We're going to be desperate about global warming because we've sat on our butts for now three decades since we were originally warned. I think hybrids are going to be the car of the future. I think plug-in hybrids are going to be the alternative fuel vehicle of the future.

But I do want to end by saying, particularly because there's a lot of people from other countries, there's a lot of students here who are going to suffer the consequences of the US's immoral climate non-policy, which is to say just really end with two words, just an apology, I am sorry, because I don't see in this country the political will to do even one of those wedges, and we need to start doing seven or eight of them within the next five to ten years.

Thank you very much.