Diatribes of Jay

This is a blog of essays on public policy. It shuns ideology and applies facts, logic and math to economic, social and political problems. It has a subject-matter index, a list of recent posts, and permalinks at the ends of posts. Comments are moderated and may take time to appear. Note: Profile updated 4/7/12

07 April 2012

Why Germany’s Bet on Renewables Will Win Big

[Note: The permalink to this post below and links to it in the Title and Subject Index previously did not work. The problem has been corrected.]

Germany is betting the store on renewable energy. It’s investing over $263 billion to convert its electrical infrastructure from coal (Germany’s traditional power mainstay) and nuclear power to the wind and sun. That’s over $3,219 for every man, woman and child in Germany.

If we invested the same amount per capita, it would be close to a trillion dollars. That’s a big bet.

Renewables’ competitors are trying to paint this conversion as both hard and foolish. But it’s neither. As I’ve recently explained, the conversion requires no major breakthroughs in engineering, let alone any fundamental advances in science or mathematics.

All the pieces to the puzzle are available now, off the shelf. This post explains why the changeover is not only not hard, but very, very smart.

1. Cost. Although it’s hard now to calculate the costs of wind and solar power precisely, they are likely to be lower than the cost of coal power, even in the short term. If you include coal’s massive “external” costs—of acid rain, mercury poisoning, particulate-induced asthma, coal smog, and global warming—wind and solar power are much cheaper.

2. Cost Trends. Smart people (like the Germans) think not just of present cost, but of costs down the road. Wind and solar power are not like any fuel-based power source (including natural gas, coal and nuclear energy). Every fuel-based power source tends to get more expensive at time goes on, as more people adopt it and demand for the fuel increases. Because wind and solar power require no fuel and create no pollution (external costs), their cost depends only on maintenance, plant cost, and plant lifetime. So they will get cheaper as time goes on and we learn to make plants cheaper, easier to maintain, and longer lasting.

3. Practically Inexhaustible Supply. Wind and solar power will never run out, at least not until our Sun incinerates us or burns out. Scientists estimate that will take at least a billion years. So infrastructure built for wind and solar power will last until (if ever): (a) it deteriorates from age or (b) we learn to duplicate the Sun’s nuclear fusion in a bottle. Germany is making a long-term investment—something our quarterly-report-based culture has trouble doing.

4. Practically Unlimited Supply. With the Earth’s present population, wind and solar power are practically unlimited. If you want more power, just build more wind farms or solar arrays. We might eventually run out of space if we fail to limit our global population. But food (and land for growing it) will run out first.

5. Freedom from Long-Term Price Increases. Because there is no scarcity of wind and sun (and no reasonable prospect of scarcity), there is no risk of limited supply. Wind and solar power will never suffer the inexorable rise in prices (apart from economic crashes) that gasoline is now suffering, or that natural gas will suffer, too, as it begins to run out.

6. No Greenhouse Gases. Neither wind nor solar power produces any greenhouse gases, so neither contributes to global warming.

7. No Pollution. Neither wind nor solar power produces any air pollution. Along with France, which gets over three-quarters of its electricity from nuclear sources, Germany will have the world’s cleanest skies. If Germany can convert its vehicle fleet to electric power, its skies will (except for industry and pollution from elsewhere) return to their pristine, pre-industrial state, while its people retain all the delights of modern civilization.

8. Reduced Danger of Accidents. Solar and wind power (in that order) are the least dangerous forms of generating electricity. They are the least likely to have serious accidents. And the accidents they are likely to have will be unlikely to have widespread consequences (beyond power outages).

9. Minimal Damage to Us and Other Species. Because they don’t produce any pollution or greenhouse gases, the wind and sun can power our modern civilization while doing minimal damage to ourselves and other species that inhabit this planet. In contrast, global warming with fossil fuels could extinguish one-third of our current fellow species.

10. Easy Transition. The current glut of cheap natural gas enables an easy transition to wind and solar power. It gives us enough time to develop longer-term solutions to the intermittency of sun and wind, including methods of electrolyzing water or synthesizing fuels, which Germany is testing now [search for “VOW”].

* * *

Less than two centuries ago, life was “nasty, brutish and short” for most of our species. What brought us out of that sad state was a series of technological innovations, in everything from agriculture and medicine to transportation and the home. Collectively, England, Germany, Japan and the United States are responsible for the vast majority of those innovations.

Germans are among the best engineers on Earth. They are responsible for (among many other things) aspirin, the Diesel engine, jet engines, and the processes we use to make polyethylene, polypropylene and other polymers. At present, and as a culture, they respect science and technology far more than we do. Their current leader, Chancellor Angela Merkel, is an ex-physicist.

So when we scratch our heads and wonder why Germany is making this huge investment in power from the wind and sun, we ought to consider who the investor is. Do you think a society that still respects knowledge and expertise, run by an ex-physicist who is doing more than any other leader to cure the epidemic of bank gambling that caused the Crash of 2008, might know more than Rush and the dolts on Fox?

Your call. But just remember, your kids’ and grandkids’ futures depend on your answer.

Footnote: Building a wind farm or solar array produces some pollution if fossil fuels power its manufacture and construction. But that’s a one-time external cost that every construction project incurs. It’s not repeated, and it’s nothing like the massive pollution that coal-fired power plants spew out every day.

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  • At Mon Apr 09, 10:42:00 PM EDT, Anonymous Anonymous said…

    This was a good article to show that some country is doing things with the next gen of energy resources essayed earlier in this series.

    From what I know of the Germans, they are very conscious of wasted resources and their plan will certainly work as their aversion to waste is cultural.

  • At Thu Apr 12, 01:48:00 PM EDT, Blogger Jay Dratler, Jr., Ph.D., J.D. said…

    Dear Anonymous,

    I agree with your comment, as far as it goes.

    But Germany’s big bet on solar and wind power does not just reduce waste. It also lowers cost.

    To understand why, you might want to read one of these three posts: (1, 2 and 3). The notion that wind and solar power are irremediably expensive is a big lie promoted by the coal industry. Investors, industry and policy makers are just now beginning to understand how wrong it is.




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