Rewiring the World with Clean Energy
Virtually every proposal to pacify our inflamed atmosphere emerging from the Paris climate conference is dismally inadequate to avoid very dangerous climate change. The Green New Deal, as currently proposed, deals only with the U.S. But absent a global program, our inflamed atmosphere will be further destabilized by emissions from India, China, Mexico, Nigeria and other developing countries. .
A global Green New Deal involves three macro-level strategies to propel a global transition to non-carbon energy. The plan also includes a critical role for the oil-producing countries of the Middle East. Critically, no new taxpayer money is used for its implementation.
* In industrial countries, remove the subsidies from fossil fuels and put those same subsidies behind non-carbon energy sources;
* For developing countries create a global fund of about $500 billion a year through a carbon tax on industrial countries to transfer clean energy technologies to developing countries; and,
* Require all countries to increase the carbon efficiency of their economies by 5 percent per year.
The U.S. currently spends more than $25 billion a year to subsidize exploration and production of oil and coal. In the industrial countries overall, those subsidies have been estimated at about $90 billion a year.
The industrial countries should rapidly redirect those subsidies to clean energy sources. A tiny portion of U.S. subsidies would be needed to retrain or buy out the nation's coal miners. But the lions' share of the subsidies would be used by major energy companies to retrain their workers and become aggressive developers of fuel cells, wind farms, and solar systems.
To jumpstart clean energy infrastructures in developing countries, a global fund of about $500 billion could be financed by a carbon tax on industrial countries to fund windfarms in India, hydrogen plants in South Africa, solar assemblies in El Salvador and tidal and wave power generating stations in the Philippines.
To implement the fund and to be sure it is used for non-carbon sources, we should enlist the private banking system to implement the energy transition. The bankswould receive a small fee to administer the fund, this minimizing corruption in recipient countries and eliminating the need for a new UN bureaucracy.
The driver of the plan is a progressive Carbon Efficiency Standard. Under this Standard, every country would start at its current baseline to increase its carbon fuel efficiency by 5 percent a year. A country would produce the same amount as the previous year with five percent less carbon fuel. Alternatively, it would produce five percent more with the same carbon fuel use as the previous year. (Domestic cap-and-trade programs could be very useful in helping countries meet their goals.)
Since no economy grows at five percent for long, emissions reductions would outpace long-term economic growth.
For the first few years, countries would achieve the 5 percent reductions simply by eliminating the waste in their current energy systems. As those efficiencies became more expensive to capture, governments would meet the progressive efficiency standard by deploying clean energy technologies which are 100 percent "carbon efficient."
That, in turn, would create the mass markets and economies of scale for renewables that would bring down their prices and make them competitive with coal and oil.
A nation's compliance could be measured simply by calculating the ratio of its carbon fuel use to its gross domestic product. That ratio would have to change by 5 percent a year.
In sum, the subsidy switch would propel the metamorphosis of oil companies into energy companies; the progressive Carbon Efficiency Standard would harmonize the transformation of national energy structures; and the competition for the new $500 billion a year clean energy market in developing countries would power the whole process.
Today every country on the planet is experiencing the increasingly ominous impacts of our changing climate. At the same time, every country requires an abundant supply of energy to compete in the global economy.
Development economists, moreover, tell us that energy investments in poor countries create far more wealth and jobs than equivalent investments in any other sector. A properly framed global energy transition would create millions of jobs in developing countries and begin to redress the economic inequity that threatens to split humanity irreparably between rich and poor.
A plan of this magnitude, regardless of the details, would turn impoverished and dependent countries into trading partners. It would raise living standards abroad without compromising ours. And in a very short time, it would jump the renewable energy industry into a central, driving engine of growth of the global economy.
A common global project to rewire the world with clean energy would be an unprecedented act of international cooperation. At the risk of being overly visionary, it might even provide the first step on a path to peace even in today's profoundly fractured world: Peace among people and peace between people and nature.
(c) Ross Gelbspan
Ross Gelbspan is the author of "The Heat Is On" (1997) and "Boiling Point" (2005). He maintains the website www.heatisonline.org and the Facebook page: www.facebook.com/heatisonline