Local businessman Jim Wellehan, a self-described “environmental geek,” should be applauded for spending $189,000 to sheath the roof of his Auburn shoe store in photovoltaic (electricity generating) solar panels, a project completed this month.
Environmental enthusiasm aside, however, Wellehan‘s bottom-line motives for undertaking this project suggest the kind of public policies and economic incentives that are needed to make the “green revolution” a success. They include a Rural Development Authority grant for 25 percent of the project’s costs, a $2,000 grant from Energy Maine, a 30 percent federal tax credit and 1 percent financing on $35,000.
Wellehan crunched the numbers and figured out his solar setup, with an estimated lifespan of 25 to 35 years, would pay for itself after the first seven or eight years through annual energy operational savings and generate free electricity thereafter.
“Hot, Flat and Crowded” by Thomas L. Friedman (published in 2008), perhaps the best popular book yet written on the critical importance of restructuring America’s energy system, offers a global context for understanding local business decisions like Wellehan’s.
Friedman believes that worldwide trends – “hot” (warming climate, resulting from fossil-fuel carbon dioxide emissions and deforestation), “flat” (the increasing urbanization, affluence and per-capita consumption of hundreds of millions of former rural peasants, especially in China and India) and “crowded” (a growing global population, projected to reach 7 billion by the end of this month) – are creating monumental shortages of energy and other finite resources that can only be managed only through a “green revolution.”
Such a revolution, Friedman argues, will not be quick, easy, cheap or painless. In fact, it will be the biggest revolution the world has ever seen, bigger than the Industrial Revolution and the Information Revolution. And it will have to come about through a confluence of strong political leadership, far-sighted government policies, technological innovation, entrepreneurial energy, and widespread public awareness and participation.
Most importantly, Friedman urges, the revolution must start immediately. There’s no time left for complacency or denial. The longer we wait, the more painful the transition will become. And the U.S., still the world’s foremost economic power, should be taking the lead, instead of playing the reluctant follower, because greening will quickly move from an economic survival to a growth strategy.
Among Friedman’s proposals:
Initiating an entirely new rate paradigm for electric companies, rewarding them for getting customers to conserve, rather than maximize, daily electricity use. Such measures would include building “smart” electrical grids (capable of monitoring in real time the power consumed by every electrical device in a customer’s home, office and factory and of efficiently synchronizing that demand with power availability), and offering financial incentives to customers for buying energy-efficient appliances, weatherizing buildings and shifting to off-peak-hour use.
Encouraging utilities and other power generators to shift from oil, natural gas and coal to renewable fuel sources through renewable energy quotas and subsidies, direct taxes on fossil fuels or indirect taxes on carbon dioxide emissions.
Imposing a high enough tax on gasoline and diesel fuel to encourage America’s transportation fleet (except airplanes) to rapidly transition to hybrid and all-electric plug-in rechargeable vehicles.
Enacting building codes which require new construction to meet high-performance standards for energy efficiency, with an ultimate goal of mandating “net zero” buildings that produce as much energy as they consume (through solar, wind and geo-thermal generation).
Far from distorting the free market, Friedman argues, measures like these will level the playing field with fossil fuels and provide utilities, industries and investors sufficient market predictability to make big, long-term investment bets on research, development, production, and deployment of renewable energy generation and transmission systems.
And as these players ramp up the market for renewables, the increasing pace of technological innovation and economies of scale will force down the per-kilowatt-hour price of renewable energy sources, encouraging an accelerating shift to renewables.
Historically, subsidies for fossil fuels — including tax breaks for oil, gas and coal companies, favorable drilling leases on public lands and sea beds, deployment of America’s armed forces to protect international petroleum sources and supply lines, low tariffs on imported foreign oil, and construction and maintenance of the interstate highway system — have given an unfair advantage to the traditional energy giants.
So has their monopolistic power, which has enabled them, along with OPEC’s petro-dictatorships, to exert considerable control over pricing, at least on the supply side, and to exert a lobbying stranglehold on Congress and state legislatures.
For the near term, fossil fuels will likely remain cheaper and more accessible than renewables. But their increasing costliness and adverse effects upon the environment, public health, weather patterns, balance of trade, and military readiness will soon become too burdensome for society to bear. Well before then, we’d better have a Plan “B” in place.
Jim Wellehan celebrated completion of his solar array by staging a daylong energy fair at his store on Oct. 15 to promote alternative energy, energy conservation and, of course, his own business. The event drew plenty of media attention.
I’m happy for Wellehan. But I’ll be even happier when projects like his become so commonplace that they don’t attract any notice. That’s when we’ll know that the “green revolution” has become part of the established order.
Comments are no longer available on this story