Thursday, February 7, 2008

Banks Adopt “The Carbon Principles”

Reuters reported the other day that Citigroup, JPMorgan Chase and Morgan Stanley have adopted “The Carbon Principles,” climate change guidelines for advisors and lenders to power companies in the U.S. The banks say the move is in anticipation of the government capping GHG emissions in the coming years and that the biggest motivation for it was financial. The new standards are the result of nine months of negotiations among the banks, environmental groups, and large utilities.

The principles were developed in consultation with power companies American Electric Power, CMS Energy, DTE Energy, NRG Energy, PSEG, Sempra and Southern Company. Environmental Defense and the Natural Resources Defense Council were also involved. The standards do not preclude bank financing for building traditional coal-burning power plants, but they do set up a more rigorous evaluation process.

The banks are open to financing coal plants that capture their GHG emissions and shoot them underground, but they say they will encourage renewable energy before coal and will help utilities push for government policies that make renewable energy and efficiency more practical.

“A rational set of carbon principles to help guide energy investment strategy is vital to our nation’s energy and economic future,” said Michael G. Morris, Chairman, president and CEO of American Electric Power, “Recognizing that energy efficiency, renewables, cleaner fossil technologies and other diverse solutions all have significant roles in addressing climate challenges while maintaining economic and energy security establishes a framework for making the best decisions regarding our nation’s energy future.”

Here are the principles as written by the banks:

Energy efficiency: An effective way to limit CO2 emissions is to not produce them. The signatory financial institutions will encourage clients to invest in cost-effective demand reduction, taking into consideration the value of avoided CO2 emissions. We will also encourage regulatory and legislative changes that increase efficiency in electricity consumption including the removal of barriers to investment in cost-effective demand reduction. The institutions will consider demand reduction caused by increased energy efficiency (or other means) as part of the Enhanced Diligence Process and assess its impact on proposed financings of certain new fossil fuel generation.

Renewable and low carbon distributed energy technologies: Renewable energy and low carbon distributed energy technologies hold considerable promise for meeting the electricity needs of the US while also leveraging American technology and creating jobs. We will encourage clients to invest in cost-effective renewables and distributed technologies, taking into consideration the value of avoided CO2 emissions. We will also encourage legislative and regulatory changes that remove barriers to, and promote such investments (including related investments in infrastructure and equipment needed to support the connection of renewable sources to the system). We will consider production increases from renewable and low carbon generation as part of the Enhanced Diligence process and assess their impact on proposed financings of certain new fossil fuel generation.

Conventional and advanced generation: In addition to cost effective energy efficiency, renewables and low carbon distributed generation, investments in conventional or advanced generating facilities will be needed to supply reliable electric power to the US market. This may include power from natural gas, coal and nuclear technologies. Due to evolving climate policy, investing in CO2-emitting fossil fuel generation entails uncertain financial, regulatory and certain environmental liability risks. It is the purpose of the Enhanced Diligence process to assess and reflect these risks in the financing considerations for certain fossil fuel generation. We will encourage regulatory and legislative changes that facilitate carbon capture and storage (CCS) to further reduce CO2 emissions from the electric sector.

Wednesday, February 6, 2008

Victory for the Planet

I have just posted today's installment of what I plan to make a regular Wednesday car post, but I need to say something about the Super Tuesday result. We can now be sure that the next president will be serious about climate change. I always thought that McCain was the only Republican with a shot at winning the general election. If he does so, his conservative credentials may actually make it easier for him to deliver than it would be for a Democrat, rather like Nixon going to China. Maybe John Adams will write an opera about it one day!

Two Clean Supercars?

Wednesday is going to be car day on the blog, and it’s time for a confession. I am a car guy, which does not sit well with concern for climate change but that’s the way it is. About 6 times a year I get into a vintage MGB race car and race other enthusiasts around a road course, burning up maybe 15 gallons of high octane fuel. What’s more, my daily driver is a Mazda RX7 which I bought new 16 years ago and which gets about 17mpg.

My excuse is that I do very few miles, and if I sold it the new owner would probably do more. Also, at least I have not incurred the emissions associated with the manufacture of a new car in those 16 years. I never expect to sell the RX7, or the 1969 Jaguar XKE with which it shares a garage, but I am on the waiting list for a new Tesla electric car to be delivered in 2009.

I was going to save this until a later blog, but last week was a milestone for Tesla when they “delivered” their first production car, to their own Chairman. This may not sound much, but it demonstrates that Tesla has met all regulatory requirements for the importation and sale of the Tesla Roadster as a fully certified production car. (The Tesla is built by Lotus in England on a modified Elise platform.) Tesla also issued a press release to say that series production would start March 17th. See http://www.teslamotors.com/media/press_room.php?id=803.

The Tesla may not strictly be a super car, being rather light on top speed, but both its price ($98,000) and its acceleration (0 to 60 in less than 4 seconds) put it at least close. Autoweek ran a road test last week, and generally liked it. One small complaint was the lack of toe-in, done to reduce rolling resistance, which made it wander over uneven payment. Another slight disappointment was the range. The company claims 267 under ideal conditions, while the EPA says 221. In hard driving, and starting with the gauge showing a 95% charge, Autoweek got only 93 miles before the gauge showed 7% and the car automatically switched to “get you home” mode. This latter restricts power and moved the gauge up to 21%. (Not quite sure of the logic of this; if the batteries are 7% charged, that is surely true however much power one is drawing. It might be better to show estimated miles remaining in current driving style.) Like all electric cars, it really needs better battery technology but this is coming. I just hope it can be retrofitted.

Tesla have sold all their 2008 production, and I shall be waiting to see the reaction from early owners. If it does not pan out I might be in the market for the diesel version of the Audi R8, due for release in 2009. While the gasoline version is available now, the Audi R8 V-12 TDI is currently just a concept. The show car’s 6 liter turbocharged V12 produces 500 bhp and no less than 738 lb-ft of torque, enough to propel it to 62mph in 4.2 seconds and on to a 186mph top speed. This is definitely supercar territory, yet Audi claims 23 mpg. (This may not seem exactly green, but compare for example the Lamborghini Gallardo, built on the same platform as the R8, at 11 city, 17 highway.)

The production Audi R8 TDI is expected to use the 4.2 liter V8 diesel from the Q7 SUV (where produces 561 lb-ft, available from 1800 rpm) and to return about 27mpg. (The gasoline R8 is EPA rated at 13 city, 20 highway.) Getting my mileage up from 17 to 27 will save over 2 gallons per 100 miles, the same as if I replaced a 24 mpg mid-size car with a 50 mpg hybrid. (See my post on January 31st.)And I still promise not to do too many miles; I will after all need to try to preserve its resale value.

Yes, I know these cars are expensive but if one of these cars lasts me 16 years like the Mazda has it will probably be my last. I hope to post on more mundane electric car news next Wednesday.

Tuesday, February 5, 2008

Nanotechnology and Climate Change

If Dustin Hoffman’s film the Graduate was set today, the one word Mr. McGuire says to Ben would be “nanotechnology” rather than “plastics.” Nanotechnology has potential applications in fields as varied as cancer treatment and new materials for aircraft manufacture, as well as a number of interesting possibilities for combating climate change. This is a quick review of some of these possibilities, following a nanotechnology conference I attended a week or so ago. I will try to come back to some of them in more detail in later postings.

Nanotechnology is the science of very small particles, from 1 to 10 nanometers, a nanometer being an American billionth (10 to the power -9) of a meter. These have interesting properties because this is small enough for quantum mechanical effects to emerge and also because the ratio of surface area to volume gets greater as the size of the particles gets smaller. Both these aspects of nanotechnology present exciting possibilities in the fight against climate change.

The first four applications below relate to two major problems with renewable energy: since renewable sources of electricity like wind and sun tend not to be constantly available, we need an efficient way to store the electricity; and since they may also not be available in the place where they are needed, we also need to be able to transmit the electricity efficiently.

The high surface area to volume ratio raises the possibility of creating “ultracapacitors” to replace chemical batteries. A capacitor is just a couple of charged conductors separated by an insulator (or “dielectric”). Connecting the two plates completes a circuit, discharging the plates and releasing the stored energy. The amount of energy which can be stored depends upon the surface area, the distance between the plates, and the type of dielectric. Conventional capacitors are used in electronic circuitry for example, but cannot hold a significant amount of energy like a battery of a similar size can. This all changes at the nano level because of the high surface area to volume ratio. Work at MIT's Laboratory for Electromagnetic and Electronic Systems (LEES) has demonstrated the use of vertically aligned single-wall carbon nanotubes.

[Nanotechnology seems to be closer than I thought! After I had prepared this post, I came across an article in this week's Economist about a prototype hybrid which uses ultracapacitors for regenerative braking. The car was exhibited at the Detroit Auto Show by AFS Trinity and is based upon a Sauturn Vue. I then found it on the web. See for example http://business2-cnet.com.com/8300-10784_3-7-0.html?categoryId=2047.]

Nanotechnology also has applications in chemical batteries. For example, Toshiba has a prototype lithium-iron battery where the surface area of the lithium is dramatically increased and the battery can be safely charged in minutes. This may have application for electric cars, making it feasible to recharge at a roadside station like we currently fill up with gas. (Though a lower tech solution is just to switch out the battery as Israel is planning. I hope to post on electric car news on the next two Wednesdays.) Also, Stanford University announced a new process that may allow lithium-ion batteries, using silicon instead of carbon as the anode, to store 10 times as much energy as current batteries.

Instead of storing energy in the form of electricity or chemically in a battery, there is the possibility of storing hydrogen and using this to generate electricity in a fuel cell. Fuel cells rely on catalysts, and the high area to volume ratio of nanomaterials greatly increases the efficiency of fuel cells.

High Temperature Superconductivity (HTSC) offers the possibility of loss-free transmission of electricity over long distances. Current power grids lose about 20% of the energy, so this could be a huge benefit even with the present generation system. Imagine however the possibility of being able to transmit power to Hamburg from a solar power station in the Sahara! Superconductivity was first observed at temperatures close to absolute zero. Later, materials were found which exhibited HTSC, but “high temperature” is relative; we were still talking about -200 degrees centigrade. A cable made of carbon nanotubes exhibits superconductivity at normal temperatures.

HTSC also offers the possibility of better electric motors. Making the windings superconductive would not only eliminate the losses, making them more energy-efficient, but because there is no heat to dissipate the motors can also be made smaller and lighter.

Quantum dots are semiconductor nanostructures which promise much cheaper and more efficient photovoltaic materials. (Current solar panels typically convert only about 15% of the sun’s energy into electricity.)

The extremely high strength of some nanomaterials, including carbon nanotubes, has obvious advantages in reducing the weight, and hence energy efficiency, of cars, planes, etc. One thing which might not be so obvious is that it will enable us to make flywheels which will run at much higher speeds without disintegrating, which means that for any given size they can store more energy. One possible application of this is in regenerative braking. Current hybrids use a generator to convert kinetic energy recovered from braking into electricity which is stored in the battery, but the energy could also be stored kinetically in a flywheel. The Federation International de l’Automobile (FIA) has recently endorsed the use of such a Kinetic Energy Recovery System (KERS) for Formula 1 racing in 2009. I will probably post more on this.

Finally, GE has announced plans to produce a more efficient incandescent light bulb based on photonic band gap technology, which utilizes a nanostructured mix of materials of different refractive index materials to concentrate the radiation into the visible spectrum. Compared to CFLs this technology promises lower prices, familiar shape and size, and no disposal problems.

Monday, February 4, 2008

Clean Aviation?: news from Airbus, Boeing, and DARPA

Aviation is responsible for only a small percentage of global greenhouse gas (GHG) emissions, but it is a fast growing sector and represents a large part of the carbon footprint of frequent travelers like myself. Some also think that the effects may be larger due to the high altitude at which emissions are released. It has also been thought that GHG from aviation is a hard nut to crack because we lack suitable alternative fuels, but three recent stories give hope.

The first story concerns Airbus, which flew an A380 from Bristol to Toulouse with just one of its four engines running on GTL. GTL stands for “gas to liquid” and is a synthetic fuel made from natural gas. The GHG benefit compared with conventional jet fuel (kerosene) is not great, but the flight is meant to be a step towards being able to use second-generation biofuels. Shell and Rolls Royce are working with Airbus, and Qatar Airways could be the first airline to use the fuel on commercial flights.

Meanwhile Virgin Atlantic, working with Boeing and GE, plans to fly from London to Amsterdam using biofuel in all four engines, with a similar flight being planned by Air New Zealand.

But the most interesting news I have seen lately was something I heard at a conference a week or so ago. Apparently the US Defense Advanced Research Project Agency (DARPA) has asked aerospace companies to bid on a new aerial surveillance project called VULTURE (for Very-high altitude, Ultra-endurance, Loitering Theater Unmanned Reconnaissance Element). A bidders meeting is scheduled for June 7th. The interesting thing is that it needs to be able to carry a 1000-lound payload and to stay up for five years! At first I was disinclined to believe it, so a Googled and found this: http://www.space.com/businesstechnology/070607_uavs3.html.

It is supposed that VULTURE will have to be solar powered, though that is not a requirement. I have not seen anything on how long the project might take, and of course any application to commercial aircraft would be much further away, but there is plenty of sun up there above the clouds and there is enormous scope for improvement in photovoltaic efficiency.

Saturday, February 2, 2008

CFL Experiences

[I am modifying the first paragraph of this post on 2/17/08 to say "up to 70" rather than "about 70" lumens per watt, to reflect the fact that 70 LPW is at the top end of the range of CFL performance. Also see this report on two tests of CFLs, which also confirms my personal experience of the amount of variation between CFLs, drop-off in brightness ovefr time, and failure rates. www.rightlight6.org/english/proceedings/Session_8/International_Lamp_Testing_Programs/s08-3p030granda.pdf]

Like some political debate, conventional incandescent light bulbs produce more heat than light. In fact, only about 2% of the energy they use is emitted as light, which is why lighting is seen as “low hanging fruit” for energy conservation and why the US and other governments have legislated to phase these bulbs out. (Actually, the legislation does not ban incandescent bulbs explicitly, but mandates a minimum efficiency of about 20 lumens per watt. Current incandescents typically produce less than 15, while compact fluorescent lamps (CFLs) easily beat the proposed standard at up to 70 lumens per watt.) There are other alternatives, and in a later posting I hope to discuss the physics behind them, but today I am going to report my own experiences using CFLs and hope to get feedback. (In fact, I plan to concentrate my Saturday postings on the practical aspects of what individuals can do to reduce climate change.)

When I set out to write this, I had envisioned a rant about how bad CFLs were, but when I looked around the house I was surprised how many such bulbs I have and how unobtrusive most of them are. I did not count the bulbs, but I did count 10 different types from 5 brands. So, not all CFLs are created equal. There are however a few general points. Firstly, some people do not like the color of the light. It tends to be slightly bluer, though this “color temperature” varies from bulb to bulb. It is more like natural daylight, and I actually prefer it. Secondly, while they are meant to come on instantly, there is often a noticeable delay and/or a longer warm-up period during which they are relatively dim. Finally, some helicals are larger than conventional bulbs, and don't always fit into table lamps.

Most of the bulbs in the house come from Bright Effects, which I think belongs to Lowes. One is a regular 15W bulb (LBP16AM2) which is fine. Most are large 18W floodlights (LBP18R402) in can fixtures, and have also operated flawlessly so far (getting on for a year). However, I bought four smaller 15W floods (LPB15R30M2) which were mounted in more confining fixtures and which failed within 3 to 6 months. Lowes refused to replace them or refund the money, saying that they do not refund on light bubs. I think they need to rethink this policy for CFLs.

I have heard of other people with similar problems, and the problem may be that the bulbs do not work well when confined in can fixtures. Even CFLs produce quite a bit of heat, and the problem may be that the electronic ballast gets fried.

I also have four GreenLite dimmable floodlights, also mounted in can fixtures. So far none have failed, but one is temperamental. Sometimes it comes on for a second and goes off again and I have to “reboot” – switch off and wait a few seconds, or maybe play with the dimmer switch. I don’t dim them often, but I have found that they flicker when dimmed low. They are also among the worst for taking time to get up to full brightness.

Another interesting bulb is a 3-way bulb from Sylvania -- 12/19/29 watts which is equivalent to about 50/85/130 for an incandescent – and I have no complaints. I also have a dozen 9 watt Sylvania decorative globes in the bathroom which have worked flawlessly, with negligible delay in startup and close to full brightness immediately. I have one 19 watt helical Sylvania, however, which has a definite delay (maybe half a second of so) and also seems dimmer now than it was when I first installed it.

I also have a couple of GE helicals – 10W and 26W – which have been very satisfactory.

Finally, I have a 15W Lightwiz helical which was still in its box. I tried it out yesterday and it seemed to work well, but I have not tested it over time.

(I also have one very expensive LED light, which is very blue and so dim that if there is any other ambient light it is hard to see whether it is on or off without looking directly into it!)

All in all I think it is well worth making the switch to CFL, at least if you live in a hot climate; I live in Houston where we use A/C most of the year so producing less heat gives a double benefit and in my case it has contributed to a 25% drop in my electricity bills. (There is no real advantage at times when you are heating the space anyway, especially if heating with electricity.) The biggest problem seems to be failure of the ballast when confined in a can fixture, but some cans seem to provide more space than others. I should perhaps add the obvious fact that this is all highly unscientific and anecdotal. I welcome comments from others on their experiences with CFLs.

Friday, February 1, 2008

Pricing Carbon – Part One

[I am modifying this post on February 15th to reflect the fact that the official IPCC target for GHG concetntration is 550 ppm. The original post referred more vaguely to "most experts" proposing a 450 ppm limit.]

Emissions of greenhouse gases (GHGs, which include gases other than CO2 but which are normally measured in CO2 equivalent) will be reduced by a combination of technology, conservation, and lifestyle changes, but the incentive for all these efforts must be a price imposed on making those emissions. Only then can these “price signals” feed through the economy and influence the decisions made by consumers. The idea of holding the emitter responsible for the total cost to society is not new; economists call effects caused by a particular actor but incurred by society as a whole “externalities.”

But how to determine the appropriate price? There are two basic ways of looking at it: either we can try to calculate the cost of the damage done by the emissions; or else we can decide that we need to set a firm limit on GHG concentration in the atmosphere and then try to set prices in such a way that this is achieved. I will elaborate on each of these, but note that to have any effect the price charged needs to be more than the cost of reducing emissions, at least in some applications. This cost will vary according to circumstances both within and between industries, and the price mechanism will encourage the reduction of emissions in those places where it can be done most economically, while concentrating the remaining emissions in those industries where it is hardest to change. (For example, it is easier to build clean new power stations and to retrofit old ones.)

The first approach to setting the price, based upon the estimated cost if we do nothing, is the one taken by the Stern Review. There are a number of problems with this approach, including two ethical ones:

Firstly, the adverse effects of climate change seem to bear more heavily on the poorest countries. Sub-Saharan Africa is likely to see worse droughts, while much of Bangladesh and all the Maldives may be under water. Meanwhile Canada expects to benefit from an open Northwest passage, Russia will see better agricultural conditions, and prestigious Champagne houses are already considering planting in England. Counting the cost in dollars using current exchange rates does not adequately reflect the suffering of third world countries. Is the loss of a peasant’s house worth less to him than the loss of a tycoon’s mansion?

Secondly, if we do nothing the adverse effects of climate change will build up for ever. Using normal discount rates to discount the far future effectively disenfranchises our grandchildren. We may prefer to spend $1 now rather than $1.05 next year, but can we extrapolate this time preference to conclude that we have the right to spend a $1 now and deprive our grandchildren of $50 eighty years hence? (1.05 to the power 80 is about 50.)

Methods of social accounting exist to deal with these issues, but they rely on subjective assumptions and therefore put the end result in question.

(Incidentally, some argue that if we go all out for growth, emitting greenhouse gases without restraint, we will be much better placed to mitigate the problem however bad it becomes, but this is an act of faith. In any case, how can the Bangladeshi farmer rely on us actually doing what needs doing when the time comes?)

Setting a firm limit on GHG concentrations seems a better way to go, and the official IPCC goal is to stabilize this at 550 ppm. From this we can set targets for emissions each year and then decide either to issue tradable permits (a “cap and trade” system) for that amount of emissions or else set a “user fee” (a.k.a. a tax, though here it really is a user fee) which we estimate will result in the target amount of emissions. On its face, the cap and trade system seems more reliable, since in theory it guarantees meeting the target. On the other hand, the market for permits can experience wild swings which make it hard for industry to plan. User fees could well work better. Their effects would need to be monitored and the rates adjusted as necessary but these adjustments would be more gradual and predictable than market swings. And they could be revenue neutral if they replaced existing taxes. Suppose industry was taxed solely on its emissions?

Part Two will probably appear late next week and will discuss the range of carbon prices resulting from each of these methods (including the European cap and trade system) and what it means to the consumer. Topics for other postings planned for the next few days include personal experiences with CFLs, and the Tesla electric car.