I’m a scientist, engineer, inventor, and father who is passionate about my kids being able to live in a clean world and feel the sense of awe in nature that I’ve been lucky to enjoy.
I’m in this fight with all I’ve got, including a lot of data that convinces me that it’s rational to have hope — that we can win big against this climate emergency.
And if we win — when we win, because there is no other option — we’ll be much better off than before. When we replace fossil fuels with clean electricity, we’ll not only have a better future for our kids, we’ll create new jobs and remain the economic powerhouse that we are today.
Billionaires might dream of escaping to Mars. The rest of us, frankly, have to stay and fight.
It’s a climate emergency. Break the glass.
What’s the Clean Energy Infrastructure We Need?
In short, to electrify everything, we’ll need about three times the amount of electricity that we currently produce.
Today, the U.S. grid delivers 450GW (gigawatts) of electricity. If we electrify nearly everything, we’ll need about 1500GW, or 1.5TW (terawatts). That’s a lot. That means on this path to decarbonization we’ll need more than 3 times as much electricity. How do we get there?
Today we can produce electricity at remarkably low costs, but the costs of distributing that electricity remain high. In the U.S., the average cost of grid electricity is 13 cents per kilowatt-hour (¢/kWh). Amazingly, more than half of this is the cost of transmission and distribution: 7.8¢/kWh. In contrast, rooftop solar in Australia provides electricity to the customer at just 6–7¢/kWh total.
That should seem shocking, and let’s reflect upon it for a moment. Locally generated electricity, because it nearly eliminates transmission and distribution costs, will likely always be less expensive than any centrally generated power source. The cheapest energy in the future will likely come from your solar roof, and we should generate as much of it as possible. In addition to homes we should look to the roofs of commercial buildings and solar cells over parking lots to increase the local generation capacity and keep our costs as low as possible.
The total amount of electricity we need, however, is more than can fit on all of our rooftops and parking spaces. So we’ll also need a significantly expanded electrical grid to supplement local generation with electricity generated in large centralized facilities. It will supply electricity to places that need it from other places where the sun is shining or the wind is blowing or the reactors are reacting. It will have microgrids and household grids and neighborhood grids and a giant grid to connect them all together. This “energy internet” will keep transmission and distribution costs as low as possible while balancing supply and demand.
The exact details will vary geographically: by local population density (urban vs. suburban vs. rural), by climatic region (hot vs. cold vs. temperate), and by resource availability (sunny vs. windy vs. soggy places that can generate hydroelectricity). Places with lower density, mild climates, and good solar resources (like Australia, California, New Mexico, and Texas) can almost completely solve the challenge with well-managed solar alone.
Multi-story dwellers in New England, however, have too small a roof and too cold a winter for this solution. High-density populations (in any climate) will probably need to lean more heavily on nuclear power or some other imported energy, which could be long-distance electricity transmission, renewably generated hydrogen, or biofuels.
In any case, the fastest, most easily scalable way to zero emissions is through electrification. To solve the climate emergency, we need to get shovels in the ground and wires in our walls as soon as possible. We can no longer afford to wait.
RAMPING IT UP
The total electricity we will need to power our lifestyles is 1.5TW–2TW (1 terawatt = 1 trillion watts). We’re currently at 0.45TW. How do we ramp up our infrastructure to provide all our energy needs?
We can generate 0.25–0.75TW of solar on our residential roofs alone. If we cover lots of our parking lots and parking spaces, that’s another 0.5TW of solar energy. Our densest cities can’t rely on solar in the same way, but covering our abundant suburbs, rural areas, parking lots, and commercial buildings will be a big start.
Midwestern farmers are already seeing economic advantages with the profusion of wind turbines silently making them money while cattle graze or crops grow below. More money will be spent in, and remain in, local communities as we build out this infrastructure, whether it’s solar on roofs or wind turbines on farms.
Remember, half the cost of electricity is the grid. The more energy we generate closer to our homes and workplaces, the lower our energy costs will be. Our cars and our home heating systems will be the biggest batteries we have when they’re interconnected to our new multitude of microgrids. We’ll need to place as much solar as possible where we live to reduce transmission and distribution costs.
Our farms and suburbs will be the cornerstone of our new electric infrastructure for both generation and storage. We’ll be building infrastructure that guarantees local jobs long into the future. There are even more jobs in retrofitting everyone’s basement with a heat pump and their kitchen with new appliances.
The composition of the future grid will be determined mostly by geography; the rest will be hammered out by policy, the market, and people’s preferences. The good news is that the target is more than reasonable with known technologies! In many markets solar is by far the cheapest form of electricity. With high certainty we can say that in a decarbonized future, average U.S. families will pay much less for all their energy bills than they do today.
Yes, it will take energy to create this new 21st century decarbonized energy infrastructure. Solar panels, wind farms, electric cars, and heat pumps don’t grow on trees. But the return on investment will be enormous. Reducing the total energy used in our economy by 50% means that these new investments will be profitable. They will create new industries, and they will put millions of people to work.
The main thing standing in our way is how we’re going to pay for it. If only the wealthiest people can opt in to paying for climate solutions, we don’t have a climate solution. We need to think about finance.
How Do We Pay for It?
You don’t fight a war because you can afford it — you fight a war because you can’t afford not to. But the fact is, we can afford it, and decarbonizing will save all of us a lot of money. How?
First, clean energy is already the cheapest option, and it’s getting cheaper every day. Second, we can finance the clean energy future in order to start the transition today. Finally, we can and must pay for our fossil fuel past in order to transition safely to a decarbonized future.
CLEAN ENERGY IS CHEAPEST, AND GETTING CHEAPER
Up until now, clean energy has been developed in places where the economic benefits were obvious. Australia figured out solar because the grid is so distributed that retail grid electricity is expensive. South Australia proved out grid-scale batteries because that was cheaper than new gas plants. California led the world in electric vehicles because air pollution in Los Angeles and other cities made the need clear. Europe and Japan mastered heat pumps because of their cold weather and limited domestic natural gas.
Once adopted, the economic benefits of clean energy are clear. The average electricity price in the U.S. is 13¢/kWh, but rooftop solar hits 6¢/kWh with the right regulations. Right now, if you drive a 25mpg vehicle at $3/gallon, it costs 12¢/mile; a 300Wh/mile electric vehicle using 6¢/kWh electricity will cost only 2¢/mile. At the average natural gas prices in the U.S., heating your home costs $11.20/MBTU. With a heat pump of COP 3 and an electricity price of 6¢/kWh, heat will cost you $5.86/MBTU instead.
And renewable technologies are just getting cheaper thanks to innovations in technology. The solar and wind industries are learning, getting cheaper as production ramps up and innovations overtake the field. These trends can be quantified into a learning rate, or the amount the unit cost of a technology is reduced when investment is doubled. For instance, solar is learning at 23% and wind at 12% — as fast or faster than fossil fuels during their 20th-century heyday. Lithium ion batteries are learning at a rate of 17%, dropping from over $1,000/kWh in 2010 to $150/kWh today, with projections to hit $60/kWh by 2030.
Energy will be cheap, and we can save more money by creating a bidirectional grid, allowing energy to flow both to and from the consumer. The fact that our new infrastructure will be closer to home, where more energy is generated and used locally, will make energy even cheaper; our own cars and homes can be used as batteries to store and transmit energy.
So, we’ve figured out the cheapest sources of clean energy. Why haven’t we implemented them? The main reasons are regulations and incentives that favor fossil fuels, and financing.
Regulations are a serious impediment to the market penetration of clean technologies. When you buy solar on your rooftop in Australia it costs $1.20/W, but for reasons of regulations, permitting, and high sales cost, that price is $3/W in the U.S. The underlying hardware is incredibly cheap, with solar modules selling internationally at 35¢/W and believable pathways to 25¢/W. We must update regulations and permitting processes that stand in the way of converting to clean energy.
Likewise, the system of subsidies to support fossil fuels gives these old technologies an unfair advantage. We have to minimize the cost of solar and wind with the right incentives and regulations, while eliminating supports that unfairly discount fossil fuels.
HOW DO WE PAY FOR THE FUTURE?
We’ve seen that with proper regulation, clean energy is already cheaper than fossil, but financing remains a major barrier to adoption. Solar, wind, electric vehicles, and heat pumps all cost you more up front, but save you money later.
The key to transitioning quickly to renewables will be creating the same kind of public-private partnerships and innovative capital financing strategies that have long underpinned America’s economic engine: loans. We must invent the climate loan, a low-interest financing option to help consumers afford the capital investments for 21st century decarbonized infrastructure.
America’s lifestyle was built on loans; the car loan and home mortgage were both 20th-century American innovations. The modern mortgage market was shaped by the federal government’s intervention in another time of crisis: the Great Depression, when property values plummeted and about 10% of all homeowners faced foreclosure. The government stepped in during Franklin Delano Roosevelt’s New Deal, when Congress passed the Home Owners’ Loan Act of 1933 to provide low-interest loans for families at risk of default. As a result, hundreds of thousands of homeowners were able to pay their mortgages, and the program actually turned a slight profit. This program gave rise to Fannie Mae in 1938, and then Freddie Mac in 1968, creating the lowest-cost debt pool the world had ever seen.
To win climate stability and a more robust energy infrastructure, the U.S. government must be just as audacious in financing zero carbon capital. Tomorrow’s infrastructure will necessarily be more personal and distributed, so it’s time to help consumers get the same low interest rates the utilities get. Today, an energy utility can get interest rates below 4% to build yesterday’s infrastructure, but a consumer gets stiffed with 9%–12% when they buy solar panels, heat pumps, electric vehicles, and batteries.
As I write this sentence, 3.45% is the U.S. 30-year mortgage rate. If we finance solar panels at this rate, their electricity will cost just 4.5¢/kWh. If, however, the same installation is financed at 10%, as is common today, the same electricity costs 8¢/kWh, nearly twice as much.
If done right, innovative low-cost financing can be one of the most effective ways to ensure equity and universal access to cheap, reliable energy in the 21st century.
HOW DO WE PAY FOR THE PAST?
We must also think carefully about the economic ramifications of the transition away from fossil fuels.
Digging holes in the ground costs money. Finding the one with oil in it costs more money. Fossil fuel companies spend a lot to find fossil fuels, and only recoup those investments slowly over time. This business model requires borrowing money to dig the holes, and when they write that mortgage to the bank, the asset they pledge to the mortgage is the oil coming out of their last well.
In the context of decarbonization, lingering debts like these are called stranded assets, and they’re a big problem. Stranded assets are resources that once had value but no longer do, usually because of a change in technologies, markets, or social habits — like railroad tracks abandoned due to a shift to automobiles.
Currently, it’s estimated that the total debt attributed to fossil fuels that aren’t even dug up yet is $135 trillion. Despite the fact that no human has laid eyes on these fossil fuels, they appear as assets on energy companies’ ledgers. Climate scientists agree that burning those reserves would compromise the 1.5°C warming limit; indeed, to stay under that target, we must not burn a third of the oil, half of the gas, and 80% of the coal in that asset pool. Because these fuels are already financed, however, they appear as assets on energy companies’ ledgers, and they’re already traded like any other form of money. If you had $135 trillion in the bank, would you relinquish it without a fight?
A 2018 study in Nature Climate Change estimated that as much as $4 trillion would be wiped off the global economy by stranding fossil fuel assets. By comparison, a loss of only $250 billion triggered the crash of 2008. The rippling effects of such an event could be catastrophic.
In navigating this precarious scenario, the best strategy may be to treat the owners of these assets, the fossil fuel industry, as friends rather than enemies. Rather than make deniers and fighters out of these companies, what if we engage them as the best allies to build the decarbonized future? They’re extremely good at financing capital-intensive businesses. They have enormous teams of smart and competent people who are good with shovels. Those people could be just as happily — probably more happily — employed building decarbonization infrastructure. Why don’t we invite them to be a driving force in World War Zero?
The only roadblock is the stranded assets, so what if we buy them out? They would only ever make a slim profit margin (around 6.5%) anyway. Let’s round it up to 10% to be generous: 10% of 135 trillion dollars is $13.5 trillion, a small fraction of our $100 trillion global GDP. The fossil fuel companies would have a huge amount of capital they could invest in the new energy economy and the new infrastructure of the 21st century, generating jobs and building new businesses with valuations far exceeding that of the stranded assets.
This may sound like a crazy idea, but it’s the type of thinking we must embrace to solve our climate problems with the biggest energy infrastructure buildout ever to occur.
20th vs. 21st Century Infrastructure
In the 20th century, public infrastructure was large and centralized — power plants, transmission lines, bridges, roads, and dams — and much of it was built to support an economy run on fossil fuels:
- 8.8 million lane-miles of roads
- 170,000 gas stations
- 500,000 bridges
- 101 nuclear reactors
- 800,000 miles of sewer lines
- 84,000 dams and reservoirs (not all hydroelectric)
- 200,000 miles of high voltage transmission lines
- 5.5 million miles of local distribution lines
- 4.4 million miles of gas pipelines
- 72,000 miles of oil pipelines
- 130+ oil refineries
Our 21st infrastructure will include more personal infrastructure connected to the public infrastructure — climate fixes we can engage in every day (see Make: Volume 72, “Decarbonization Begins at Home,” makezine.com/go/fop2) — almost all of which help us generate or store clean energy:
- 120 million solar roofs
- 253 million cars
- 16 million trucks
- 90 million furnaces
- 150 million refrigerators
- 100 million hot water heaters
- 1 billion parking spaces
- 120 million new smarter fuseboxes
- Power meters that go both ways
How to Finance World War Zero
» Minimize the cost of solar and wind with the right incentives and regulations. This means detailed local regulatory and building code work, as well as reform of National Electrical Codes (NEC) and FERC.
» Eliminate all fossil fuel subsidies to even the playing field.
» Minimize grid costs by allowing energy to flow both to and from the consumer. This will require utility reform.
» Finance industrial manufacturing infrastructure to lower the costs of EVs, batteries, solar, heat pumps, and smart grid components, similar to how the U.S. government underwrote the Arsenal of Democracy.
» Climate loans — Create a federal government-guaranteed, low-interest consumer financing instrument similar to Fannie Mae for the package of decarbonizing infrastructure that decarbonizes a home.
» Buy the proven reserves of fossil fuel companies to bring them into the green future as allies, not enemies.