[Fresh Ink] Memo to the President-elect on Energy Realism - Richard Heinberg

[Richard Menec]

http://www.energybulletin.net/node/47404

Museletter: Memo to the President-elect on Energy Realism and the Green New 
Deal

04 Dec 2008

MuseLetter 200         December 2008

by Richard Heinberg

Executive Summary Our continued national dependence on fossil fuels is 
creating a crippling vulnerability to both long-term fuel scarcity and 
catastrophic climate change.

The current economic crisis requires substantial national policy shifts and 
enormous new government injections of capital into the economy. This 
provides an opportunity for a project whose scope would otherwise be 
inconceivable: a large-scale, coordinated energy transition away from fossil 
fuels and toward renewable energy.

This project must happen immediately; indeed, it may already be too late. We 
have already left behind the era of cheap and plentiful fossil fuels, with a 
permanent decline of global oil production likely underway within three 
years. Moreover, the latest research tells us we have less than eight years 
to bring carbon emissions under control if we hope to avoid catastrophic 
climate change. Lacking this larger frame of understanding and action, a 
mere shift away from foreign oil dependence will fail to meet the challenge 
at hand.

The energy transition must not be limited to building wind turbines and 
solar panels. It must include the thorough redesign of our economic and 
societal infrastructure, which today is utterly dependent on cheap fossil 
fuels. It must address not only our transportation system and our 
electricity grid, but also our food system and our building stock.

Our 21st century nation's dependence on 20th century fossil fuels is the 
greatest threat we face, far more so than the current financial crisis. A 
coordinated, comprehensive transition to an economy that is no longer 
dependent on hydrocarbon fuels and no longer emits climate-changing levels 
of carbon-a Post Carbon Energy Transition-will be the Obama Administration's 
greatest opportunity to lead the nation on a path toward sustainable 
prosperity.

Overview: Need and Scope As a new Administration prepares to take the reins 
of power, America's economy is descending into a recession or, quite 
possibly, a depression. Deepening economic turmoil is generating an 
assortment of urgent priorities for the national leadership. Among 
economists there is widespread discussion of the need for an economic 
stimulus package of historic proportions to create jobs and spur more 
production and consumption.

Meanwhile, a more profound crisis has been silently gathering for decades, 
and is now reaching a point of no return. This crisis issues from our 
reliance on fossil fuels, and it manifests as the twin dilemmas of fossil 
fuel depletion and climate change.

Fossil fuels define the modern era. Their concentrated, inexpensive energy 
has generated unprecedented economic benefits, enabling Americans to enjoy 
cheap food, cheap travel, and cheap manufactured goods made from and with 
petrochemicals. But our unbridled consumption of fossil fuels has brought us 
to the current crisis, where we face both the imminent decline of our most 
important energy source and the very real possibility of catastrophic global 
climate change.

These two challenges highlight the hidden costs of our still-growing 
dependence on oil, coal, and natural gas-costs that may do far more than 
merely drive the economy into a depression.

Fossil fuel depletion and climate change present threats of a scale 
unprecedented in human history. Failure to address them will risk an 
economic collapse from which no recovery is possible, as well as 
environmental calamity of apocalyptic dimensions. Moreover, the impacts we 
face are not decades away; they are immediately threatening. It is no 
overstatement to say that if we in this nation-and soon, the entire human 
family-cannot agree upon and undertake a deliberate, proactive transition 
away from fossil fuels beginning immediately, we may forfeit our last 
realistic opportunity to avoid global economic and environmental collapse.

As the world's top oil consumer and economic power, it is incumbent upon the 
United States to lead the way out of this crisis. A wide range of 
far-reaching policies and initiatives-touching every aspect of modern 
society from transportation and electricity to food and housing-is needed 
worldwide to ensure a peaceful and equitable energy transition. This global 
effort must begin here and now with a national plan to reduce energy 
consumption, develop renewable energy sources, and reconfigure our fossil 
fuel-dependent infrastructure.

By taking up a de-carbonized renewal of America's transport, electricity, 
food, and housing systems, the new Administration can address a number of 
problems simultaneously: climate change, economic contraction and 
unemployment, environmental destruction, resource depletion, geopolitical 
competition for control of energy, balance of trade deficits, the threat of 
hunger, and more.

The energy transition plan must not be merely a wish list of good ideas, but 
a prioritized, staged program with robust funding and hard yet realistic 
targets.

Further, it must be presented to the American people in a compelling way: 
public education on a massive scale will be required to help ordinary 
citizens understand what is at stake and how sacrifices undertaken now can 
build a better world tomorrow.

Despite the need for public buy-in, the purpose of this document is not to 
outline a program that will be an easy "sell" from a political standpoint; 
rather, its intent is to set forth what is actually needed in order to save 
America and the world from economic and environmental collapse-and what is 
needed may not be easy or palatable. Somehow the necessary must be 
reconciled with the possible, but it is the empirical requirements for 
survival that are ultimately decisive. It will be the task of leaders at all 
levels of government to mold political realities to fit those requirements.

The current financial calamity is appearing at perhaps the last historic 
moment when action to avert climate catastrophe has a chance of succeeding. 
Crisis is nearly always an opportunity for someone or something. In the 
current instance, economic crisis affords the opportunity for bold action of 
a kind and on a scale that would otherwise seem unacceptable.

The Problem The fossil-fueled economy Something both wonderful and terrible 
has happened in the past two centuries. As a people, we have become more 
mobile. We now spend only a small portion of our incomes on food, and only a 
tiny proportion of us need to bother ourselves with growing it. Our shopping 
malls have become filled with a dizzying array of products, many of them 
imported from around the world.

These are just some of the gifts of fossil fuels-concentrated energy sources 
that have proven both cheap and abundant.

But claiming these gifts has led us to build a societal infrastructure that 
is designed for, and utterly dependent on, plentiful oil, coal, and natural 
gas.

We have built cars and trucks, and an extensive network of highways on which 
they travel. We have built passenger aircraft that are swift and safe, and 
airports in practically all medium and large cities.

We have configured our food system to take advantage of these fuels by 
mechanizing production, by using petrochemicals to fertilize crops and kill 
weeds and pests-and then by transporting food ever further distances to 
centralized processing and storage centers and finally to giant supermarkets 
intended to be accessed almost exclusively by private automobile.

We heat our homes with fossil fuels, and we have designed our homes around 
automobiles, setting aside a large portion of interior space to enclose them 
in garages. We have built countless neighborhoods through and to which no 
one is expected to travel by any mode other than by car. We define the 
functionality of our cities by the highways that connect their neighborhoods 
and suburbs.

We have built an electric grid system to supply power for every aspect of 
commerce and daily life-from communication to entertainment to food 
refrigeration. This essential system depends on fossil fuels for two-thirds 
of its energy.

In short, we have become systemically dependent on cheap fossil fuels. And 
in this systemic dependency lie acute vulnerabilities.

Fossil fuel depletion It may be too soon to speak of the end of fossil fuels 
altogether, but we have unquestionably reached the end of an era.

It is increasingly clear that global oil production growth is stalling, with 
permanent decline likely underway by 2012. The petroleum price spike of 
2008, in which the cost of a barrel of oil rose to $147, was a warning of 
what is to come. The International Energy Agency (IEA) World Energy Outlook 
2008 report released in November concluded:

Current global trends in energy supply and consumption are patently 
unsustainable,...the sources of oil to meet rising demand, the cost of 
producing it and the prices that consumers will need to pay for it...[are 
all now] extremely uncertain. The report's Executive Summary points out that 
nearly all future world oil production growth depends on supplies from OPEC, 
and ends with the unequivocal judgment that "the era of cheap oil is over," 
warning member nations that, "the time to act is now."

We have tended to think of coal as being so abundant that supply constraints 
will not appear for many decades or even centuries. Yet a 2007 report by the 
National Academy of Sciences concluded:

Present [official US] estimates of coal reserves are based upon methods that 
have not been reviewed or revised since their inception in 1974, and much of 
the input data were compiled in the early 1970s. Recent programs to assess 
reserves in limited areas using updated methods indicate that only a small 
fraction of previously estimated reserves are actually minable reserves. A 
2007 report from an energy research body established by members of the 
German Parliament, suggests that production of coal in the US may reach its 
maximum level as early as 2030, after which it will decline as high-quality 
resources are exhausted. With such limited supplies, and in the absence of 
commercially viable carbon sequestration-which is still at least 25 years 
away and has its own set of challenges regarding energy efficiency and 
scalability- coal is neither an economically nor environmentally sustainable 
solution for our future energy needs.

Production of "conventional" natural gas in North America is declining, but 
recent technical advances have enabled the industry to extract substantial 
new quantities of this fuel from low-porosity reservoirs. We are now hearing 
assurances from some of the companies producing such "unconventional" gas 
that the nation has over a hundred years' worth of the resource. However, 
rapid depletion rates in new gas wells force the industry to pursue 
ever-higher drilling rates (drilling rates are today three times what they 
were a decade ago), suggesting this resource may be much more short-lived.

There are also economic problems with shifting to natural gas. The low 
amount of energy returned on the energy invested in unconventional gas 
infrastructure and drilling efforts suggests that further production growth 
will be achievable only with very high natural gas prices, and that much of 
the resource theoretically available will never be produced no matter how 
high the market price goes. Liquefied natural gas (LNG) imports are a poor 
long-term alternative, given growing global demand for the fuel, significant 
gas import dependency in Europe, and reports of shipments being diverted en 
route to higher bidding ports.

Altogether, over the course of a few generations we have depleted what 
nature generated throughout tens of millions of years. We have picked the 
low-hanging fruit. We must plan and prepare for the end of fossil fuels now, 
while we still have a relative abundance of energy with which to build the 
alternative energy infrastructure that we will soon need.

Climate change In the process of burning fossil fuels, we are releasing 
gases into the atmosphere that are changing the global climate, and thus 
reducing the survival prospects of future generations.

New data always seem to outdistance previous forecasts: the north polar 
icecap is melting much faster than projected, and thawing arctic permafrost 
is already releasing unexpectedly large quantities of methane, a greenhouse 
gas 20 times more powerful than carbon dioxide.

In other words, the level of atmospheric carbon dioxide believed only a few 
years ago to be "safe"-in that it would not trigger catastrophic climate 
change-seems already to be making some of the predicted worst-case impacts a 
reality.

Leading climate scientist James Hansen of NASA, among others, is now 
advocating the adoption of 350 parts per million of atmospheric carbon 
dioxide as the global target for climate protection efforts. The current 
level, however, is approximately 387 ppm. We are already beyond the 
threshold.

This means that, if humankind is to avoid catastrophic climate change, we 
must being reducing fossil fuel carbon emissions immediately, and bring them 
virtually to zero before mid-century.

The financial crisis Ostensibly, the ongoing credit crunch is the result of 
a subprime mortgage fiasco plus the leveraging of debt through financial 
instruments so sophisticated that virtually no one who purchased them 
understood their risk.

However, the fact that world oil production was essentially stagnant during 
the years 2005-2008 (leading up to price spike of 2008) should not be 
overlooked as a contributor to the economic meltdown. Previously, the growth 
of financial capital could be supported by the energy-based growth of the 
real national and global economy. But as energy prices soared-crippling the 
airline and auto industries and raising costs for farmers, manufacturers, 
and shippers-the financial balloon suddenly began to deflate.

Unfortunately, connections between energy and economic activity are often 
overlooked: energy is widely regarded as merely a component of the economy, 
whereas in fact the entire economy crucially depends upon energy. If energy 
supplies are cut off, economic activity halts; and without energy growth, 
economic growth becomes problematic if not impossible.

Paradoxically, now that the global economy is contracting, investment in 
future oil, coal, and gas production projects is dwindling. At the same 
time, investment in renewable energy projects is also falling away. This 
virtually guarantees future energy shortages.

The cruel result is that as soon as the economy begins to grow once again, 
energy supply limits and skyrocketing energy prices will nip recovery in the 
bud.

Therefore it would be self-defeating for the new Administration to put the 
energy transition on the back burner while giving full attention to the 
immediate financial crisis. The financial crisis must be addressed by 
pursuing an energy transition.

Similarities to, and differences from, the 1970s The current energy and 
economic crises carry unmistakable and disturbing echoes of the 1970s. In 
1977, President Carter addressed the nation, telling Americans that,

With the exception of preventing war, this is the greatest challenge our 
country will face during our lifetimes . . . We simply must balance our 
demand for energy with our rapidly shrinking resources. By acting now, we 
can control our future instead of letting the future control us . . . The 
most important thing about these proposals is that the alternative may be a 
national catastrophe. Further delay can affect our strength and our power as 
a nation . . . This difficult effort will be the "moral equivalent of 
war"-except that we will be uniting our efforts to build and not destroy. In 
retrospect, his speeches were a courageous effort to prepare the nation for 
the inevitable decline in fossil fuel production, which now looms, and to 
avert geopolitical conflict over remaining supplies. Had we followed the 
course that President Carter recommended, America might not be so vulnerable 
today.

But Carter lost the 1980 election to Ronald Reagan, who promised a 
sacrifice-free return to prosperity. All politicians understandably regard 
this as a cautionary tale when considering any bold effort to reduce America's 
dependence on fossil fuels. Nevertheless, there are reasons that the 
situation today is different.

First, the energy crisis isn't going away this time. In the 1980s, the 
nation could turn to recently discovered giant oilfields on Alaska's North 
Slope and the world had gained access to abundant, high-quality crude oil 
from the North Sea. Today there are few new frontiers available for 
exploration. Oil from the planet's polar regions (including ANWR) will be 
costly to produce and slow to arrive. Crucially, these new supplies will 
probably be insufficient to make up for worsening production declines from 
existing oilfields.

Second, the economic crisis is worse this time. While the oil shocks of the 
1970s and the costs of the Vietnam War forced the U.S. to repudiate the gold 
standard and resulted in several years of low or negative growth, the 
economic calamity currently engulfing the world is leading historians to 
look further back to the 1930s or the 19th century for precedents. Many 
economists have concluded that interest rate adjustments and a $700 billion 
bailout package will not be enough to forestall a depression. Something bold 
must be done-and it must involve government spending on a grand scale that 
has the effect of massive job creation. Today the question is not, Can our 
leaders afford to be bold? It is rather, Can they afford not to?

Finally, there simply is no longer a "business as usual" option for our 
energy future. According to the IEA, trillions of dollars of new investment 
will be needed for exploration and the implementation of new extraction 
technologies if fossil fuel production is to continue satisfying growing 
demand for the next two decades (for the world as a whole, over $26 trillion 
will be required in year-2007 dollars for the period 2007-2030). On the 
other hand, trillions will also be needed to build a renewable energy 
infrastructure.

The difference is that the former solution would be temporary: fossil fuels 
are finite and depleting resources. We will still face scarcity even after 
paying the enormous cost of finding and developing the last of the world's 
oil and gas fields and coal mines. Renewables, on the other hand, can power 
society indefinitely. In either case most of the needed investment should 
come not from government, but from the private sector. However, government's 
role will be decisive in setting the course through leadership, 
coordination, regulation, and investment.

The current financial crisis forces the conclusion that America cannot have 
it both ways. Either we direct public investment toward developing 
expensive, low-grade fossil fuels (such as tar sands, oil shale, and shale 
gas) in a vain effort to maintain growth in our fossil-fuel dependent 
economy, or we direct investment toward building the renewable energy 
infrastructure of the future.

If the 1970s were an early warning, today is the final moment for action. We 
will have no third chance at the energy transition.

The Solution The obvious answer to fossil fuel depletion and climate change 
is to simply substitute alternative energy sources for oil, natural gas, and 
coal.

However, this solution quickly bogs down on two fronts. First, there are no 
alternative energy sources (renewable or otherwise) capable of supplying 
energy as cheaply and in such abundance as fossil fuels currently yield, in 
the time that we need them to come online. Second, we have designed and 
built the infrastructure of our transport, electricity, food, and heating 
systems to suit the unique characteristics of oil, natural gas, and coal; 
changing to different energy sources will require the redesign of many 
aspects of those systems.

The energy transition cannot be accomplished with a minor retrofit of 
existing energy infrastructure. Just as the fossil fuel economy of today 
systemically and comprehensively differs from the agrarian economy of 1800, 
the post-fossil fuel economy of 2050 will profoundly differ from all that we 
are familiar with now. This difference will be reflected in urban design and 
land use patterns, food systems, manufacturing and distribution networks, 
the job market, transportation systems, health care, tourism, and more.

It could be argued that these changes will occur in some fashion whether we 
plan for them or not, that it is only necessary to wait for the market price 
of fossil fuels to reflect scarcity, with higher costs forcing society to 
adapt. However, lack of planning will result in a transition that is 
chaotic, painful, destructive, and perhaps (if the worst climate forecasts 
are realized), unsurvivable. As a recent study for the U.S. Department of 
Energy showed, such a passive approach to the problem would lead to "social, 
economic, and political costs" of "unprecedented" scope. Once again: bold 
action is required.

We need to reduce our overall energy consumption, and restructure our 
economy to run primarily on renewable energy-and the federal government must 
lead the way. This energy transition should have five components: a massive 
shift to renewable energy, and a retrofitting of the four key systems of 
electricity, transportation, food, and buildings.


1. Make a massive and immediate shift to renewable energy

The development of alternative energy sources must obviously be a 
cornerstone of any plan to reduce our national reliance on conventional 
fossil fuels. However, many alternatives being discussed-including nuclear 
power, industrial-scale biofuels, and low-grade fossil fuels such as oil 
shale and tar sands-suffer from serious drawbacks, including low energy 
profit ratios, high environmental impacts, or a limited resource base.

Renewable energy sources such as wind, solar, and advanced geo thermal 
clearly represent the long-term solution to the nation's and the world's 
energy problems. However, in many cases these require further research and 
evaluation. For example, research is needed into new energy storage 
technologies, as well as new photovoltaic materials and processes, and new 
geothermal and tidal power technologies. While much of this could be 
accomplished by the private sector, the economic crisis is likely to delay 
or undercut needed funding, increasing the need for government support.

The U.S. Department of Energy should be tasked with undertaking a rapid but 
thorough assessment of available alternative energy production technologies 
using a carefully mapped set of consistent criteria. This assessment should 
be formatted in a way that helps states and communities, as well as the 
federal government, make practical planning and investment decisions.

Given the immediacy of this need, Post Carbon Institute, in collaboration 
with the International Forum on Globalization, is currently undertaking a 
preliminary comparative review of alternative energy sources, using criteria 
including energy profit ratio, environmental impacts, scalability, and 
materials requirements. That publication will be available by February 2009.


2. Electrify the transportation system

America's sunk investment in highways, airports, cars, buses, trucks, and 
aircraft is enormous. However, this is a transport system that is completely 
dependent on oil. It will be significantly handicapped by higher fuel 
prices, and devastated by actual fuel shortages.

The electrification of road-based vehicles will help; however, this strategy 
will require about two decades to fully deploy, given that the average 
passenger vehicle has a useful lifetime of 15 years. Meanwhile, road repair 
and tire manufacturing will continue to depend upon petroleum products, 
unless alternative materials can be found.

Even if it is electrified, a ground transport system consisting of trucks 
and private automobiles is inherently energy intensive compared to public 
transit alternatives like bus and rail, and non-motorized alternatives like 
bicycling and walking. The building and widening of highways must come to a 
halt, and the bulk of federal transportation funding must be transferred to 
support for electrified and non-motorized infrastructure and services. This 
overall shift of transport investments and priorities will require 
comprehensive planning and coordination at all levels of government.

There are few if any good options for maintaining the airline and air 
freight industries without cheap fossil fuels. While some amount of air 
travel is likely to persist throughout the transition, its cost will 
inevitably and persistently rise, and the airline industry will contract 
accordingly. Increasingly, high-speed electric rail connections between 
major cities will become the lower-cost option, but the national high speed 
rail network is still in its infancy. Meanwhile, the existing fleet of 
private automobiles must be put to use more efficiently through carpooling, 
car-sharing, and ride-sharing networks coordinated primarily at the local 
level, but supported by federal policy and funding.


3. Rebuild the electricity grid

Nearly all experts on the U.S. electricity grid agree that the system is 
approaching crisis and desperately needs a substantial overhaul. Electricity 
demand has been growing at over one percent per year due to rising 
population and an explosion in the numbers and types of electronic devices 
now considered essential, but power generation capacity has not kept up. 
Meanwhile our transmission networks rely on 100- year-old technology and 
high-voltage trunk lines that were installed in the 1950s and '60s. It is a 
fragile and extremely inefficient infrastructure, and managers of the system 
anticipate widespread blackouts in the near future.

What is needed is not merely an enhancement of the existing system with more 
of the same technology. New generating capacity must come from renewable 
sources, many of which are intermittent and are likely to be sited far from 
existing power lines. The transmission system must support distributed 
generation, as well as robust two-way communications, advanced sensors, and 
distributed computers to improve the efficiency, reliability, and safety of 
power delivery and use.

Regional utility companies are already beginning to invest in renewables and 
"smart grid" upgrades, but the work is going much too slowly to avert 
looming power supply problems. Moreover, the credit crunch will likely slow 
the work that is currently under way.

Therefore the federal government must step in to set goals and standards and 
provide public investment capital. This effort must not favor commercial 
utilities over municipal power districts; indeed, the devolution of control 
over power systems to the community level should be encouraged, as 
decentralized power systems are likely to be more resilient in the face of 
now-inevitable power disruptions.


4. De-carbonize and relocalize the food system

Our national industrial food system performs spectacularly well at producing 
cheap, abundant food using minimal human labor. However, it is 
overwhelmingly dependent upon oil and natural gas for tractor fuel, 
fertilizer, pesticides, herbicides, and the transport of farm inputs and 
outputs. Moreover, the current food system is responsible for over 20 
percent of all greenhouse gases introduced into the atmosphere from human 
activities in the U.S.

This situation is patently unsustainable. As fuel prices rise, farmers will 
go bankrupt and food prices will skyrocket. As the global climate becomes 
destabilized, crops will wither. Unless America undertakes a coordinated, 
planned redesign of its food system to eliminate dependence on fossil fuels, 
the future looks bleak. Famine, which formerly was an unwelcome but 
unavoidable fact of life in agrarian societies, could make a comeback even 
here in the wealthy U.S.

New farming methods, new farmers, and a re-localization of production and 
distribution are all required. These in turn will require land reform, 
educational and financial support for new farmers, and the creation of local 
food processing and storage centers.

Post Carbon Institute, in collaboration with the Soil Association of Great 
Britain, is producing a report (forthcoming in early 2009) on "The Food and 
Agriculture Transition," highlighting the context, issues, and possible 
strategies in detail.


5. Retrofit the building stock for energy efficiency and energy production.

Most Americans live in homes that require heat during the winter months, and 
most of those homes are inadequately insulated by modern standards. Natural 
gas heats most of the nation's homes, with a majority in the Northeast 
heated by oil. Buildings in the South and Southwest require air conditioning 
during summer months. Fuel shortages, power outages, and energy price hikes 
could bring not just discomfort, but a massive increase in mortality from 
cold and heat.

The technology already exists to increase energy efficiency in both new and 
existing buildings. Germany has successfully pioneered the "Passive House" 
standard that dramatically reduces the energy required for heating and 
cooling; the European Union is considering adopting it as a building 
standard by 2012. In this country organizations like Affordable Comfort 
Incorporated (ACI) have been doing important work along similar lines for 
decades, and both the US Conference of Mayors and the American Institute of 
Architects have adopted the 2030 Challenge to set a nationwide 
carbon-neutral standard for all new buildings by 2030.

Throughout America, millions of buildings can and must be superinsulated 
and, in as many instances as possible, provided with alternative heat 
sources (passive solar, geothermal, or district heating).

However, the widespread deployment of existing knowledge and experience to 
retrofit millions of American homes and public buildings will require 
investment as well as trained workers. Once again, the potential exists for 
the creation of millions of jobs-as Van Jones has discussed in his proposals 
for a Clean Energy Corps. But funding, new regulations, and education are 
needed.


Requirements for an Energy Transition

1. Investment and capitalization

Clearly, enormous amounts of investment capital will need to be mobilized to 
accomplish the energy transition. The promise of $150 billion to be spent on 
renewable energy over the course of the next ten years is a welcome 
beginning; however, it must be seen merely as a small component of the 
entire transition program. As noted, much of the needed investment can 
eventually come from the private sector, but since the private sector is 
currently contracting economically this puts the onus back on government.

How can enough capital be deployed? The current practice of deficit spending 
may not be sustainable in the context of a faltering global economy, as 
there may be limited demand for U.S. government IOUs.

Other options for creating the needed capital should be explored, such as 
direct money creation through government spending. While this practice might 
have adverse implications for the value of the dollar, it is constitutional 
and has historical precedents during the Kennedy and Lincoln presidencies.


2. Coordination

The energy transition will be complex and comprehensive, and its various 
strategies will be mutually impacting. For example, efforts to redirect 
transport away from highways and toward rail service will need to be 
coordinated with manufacturers, farmers, retailers, and employers.

Therefore, within every government department considerable effort will need 
to be spent coordinating that department's overall efforts with the energy 
transition.

The coordination process could be aided substantially by the creation of an 
office, tied to no existing Department, specifically tasked with tracking 
and managing the energy transition, and with helping existing Departments 
work together toward the common goal.


3. Carbon and energy policy

Worldwide, there has already been much discussion of, and some 
experimentation with, policies to discourage fossil fuel use and encourage 
the transition to renewable energy sources. More exploration of such policy 
options is needed.

The carbon Cap-and-Trade scheme that was deployed in the European Union, in 
which fossil fuel companies were automatically awarded carbon credits, has 
tended merely to push high-polluting jobs to poorer nations, while enriching 
bankers with trading commissions and rewarding established polluters.

The auctioning of all carbon credits, so that existing polluters must buy 
them, would be a clear improvement on that system. Cap-and-Dividend or 
Cap-and-Share programs would go further still by promoting social equity, 
with the proceeds from carbon credit auctions going directly to the public 
to offset the impact of rising energy costs.

As Al Gore has suggested, carbon taxes could raise government revenue to pay 
for the energy transition and discourage fossil fuel consumption while 
replacing payroll taxes-thus adding minimally or not at all to the tax 
burden of citizens.

However, all such systems assume a market for fossil fuels in which severe 
resource scarcity plays little or no role. In fact, scarcity may partially 
undermine carbon trade, share, or dividend systems (no oil company would 
need to buy carbon credits if the supply of oil is shrinking as fast as 
yearly caps would otherwise mandate), while resulting in extreme price 
volatility that would overwhelm both individual consumers and entire 
industries. Under a carbon tax system, falling oil production would 
translate to falling government tax revenues.

A policy solution to the depletion-led scarcity dilemma might be a fuel 
quota rationing system administered so that the total number of quotas 
issued declines annually. Such a system, called Tradable Energy Quotas 
(TEQs), is being studied in Britain. In it, quotas of carbon or specific 
fossil fuels (e.g., gasoline) would be issued electronically to all adults 
yearly, with the information stored on a magnetic card swiped at the point 
of fuel purchase. Each year the total quantity of quotas would be reduced to 
conform either with carbon reduction targets or declining fuel availability. 
Consumers could sell extra quotas or purchase them as needed, with the 
market price reflecting aggregate supply and demand. Each consumer would 
thus have an immediate interest in conserving fuel. Allowances could be made 
for low-income citizens with temporary need for more quotas as they get rid 
of older cars and insulate homes.

Policy tools to directly support the deployment of renewable energy sources, 
such as Renewable Portfolio Standards (RPS) and Feed-in Tariffs, should also 
be reviewed for effectiveness, comparing existing case studies. In general, 
Feed-in Tariffs, in which government guarantees a price for electricity 
generated from renewable sources, appear to succeed in harnessing 
entrepreneurial zeal to the energy transition.

Innovative financing policies like California's AB 811 could help cities 
provide low-interest loans to homeowners for renewable energy.

Meanwhile, laws and incentives affecting the food system (including food 
safety laws and farm subsidies) will need to be reconsidered so as to 
provide preferential support for small-scale, local, low-input producers.


4. Education

The energy transition will result in the creation of many millions of new 
jobs and careers. While President-elect Obama called for the creation of 
five million green-collar jobs, the energy transition will in fact demand 
something on the order of a ten-fold increase in that goal. However, these 
new jobs and careers will require skill sets largely different from those 
currently being imparted by our educational system.

Because they are inexpensive, numerous, and widely dispersed, community 
colleges could play a central role in preparing workers for new 
opportunities in sustainable food production, renewable energy installation, 
grid rebuilding, rail expansion, public transport construction, and home 
energy retrofitting.

In order for community colleges to fill this new role, teacher training and 
curriculum development on a grand scale will be needed, ideally organized 
and coordinated at the national level through the Department of Education.

This reorientation of curriculum should begin with gardening programs in all 
grade schools and increased course emphasis on topics related to energy and 
conservation.


5. Public messaging

The successful management of a project of the scope outlined here will 
require public buy-in at every stage and level, and this in turn will depend 
upon the use of language and images to continually underscore what is at 
stake, to focus attention on immediate and long-range goals, and to foster a 
spirit of cooperation and willing sacrifice. This in itself is no small task 
in a nation that is politically divided and that has come to regard 
consumerism as patriotic.

As in the New Deal and World War II, business leaders, advertising agencies 
and even Hollywood must be enlisted in the effort-indeed, this high-level 
cooperation must be seen as a quid pro quo for the Federal government's 
enormous efforts to salvage the economy by bailing out banks and 
corporations.

President-elect Obama built his campaign around grassroots organization and 
the empowerment of individuals to take ownership of a movement. The energy 
transition could similarly benefit from a sophisticated, interactive, 
web-based program to inspire individual and group action by providing tools 
and resources for reduction of fossil fuel dependence.

Tax breaks could be offered to businesses, churches, and other groups that 
develop personal action teams. Civic programs, such as a mayors' challenge, 
could also play a significant role. Grassroots initiatives, such as the 
international Transition Towns movement, could lead the way toward voluntary 
community efforts to end fossil fuel dependency.


6. Planned decentralism

During the Franklin Roosevelt Administration, advisors engaged in a healthy 
debate about whether the New Deal should consist solely of a top-down 
imposition of new bureaucratic programs, or whether it should also, or 
primarily, seek to build healthy local communities and regions with the 
autonomy to design their own development strategies. Arthur Morgan was 
perhaps the primary decentralist intellectual of the period, but the 
movement-which traces back to Thomas Jefferson-included southern agrarians 
as well.

In the present instance, decentralist ideas and strategies must be taken 
even more seriously than was the case in the 1930s, if only because the end 
of cheap energy will inevitably entail a reduction in Americans' mobility, 
and a re-localization of production and consumption.

This emphasis on decentralism could translate to the creation of programs 
designed at the sub-federal level that promote increasing regional 
self-sufficiency in food, manufacturing, and energy production.


7. Challenging goals and targets

The energy transition cannot be accomplished in four years or eight: the 
construction of our existing fossil fuel-based societal infrastructure 
required a century, and its replacement will take three or four decades at a 
bare minimum. What can and must be accomplished in a single administration 
is the essential change of direction-the beginning of a process of renewal 
that can persist through other administrations to its ultimate fruition.

This sense of embarking on a journey with a long arc of collective struggle 
toward an eventual goal can best be maintained through specific time-based 
targets for reducing carbon emissions, reducing fuel consumption, building 
renewable energy generation capacity, improving public transit systems and 
constructing new ones, producing more local low-fuel food, and retrofitting 
buildings for high energy efficiency. A series of challenging yet feasible 
annual and four-year targets should be set at the beginning of the 
transition process, with the ultimate goal-complete freedom from fossil fuel 
dependency-to be achieved by 2050. Future Administrations will be in 
positions to adjust strategies toward the realization of that goal, but the 
goal itself must remain irrevocable through bipartisan consensus.

Targets can be extended through every sector, from individuals to schools, 
government, and businesses. The Federal government should take the lead by 
setting targets for all federal buildings, departments, and employees.

Achievement of annual targets should be cause for public celebration, mutual 
congratulation, and a refocusing of effort on the long-term goal.


Conclusion

What is being suggested in this proposal is of such enormous scope that its 
intended audience may initially be inclined to dismiss it out of hand. 
However, the authors have not exaggerated likely costs of inaction, nor have 
we overstated the critical need for comprehensive changes in interconnected 
societal systems that now depend upon an unmaintainable flow of cheap fossil 
fuels.

Nevertheless, we have perhaps not adequately stated the benefits of pursuing 
this program. By ending our national addiction to fossil fuels, we can 
shrink this country's need to police energy-rich areas of the world and 
foster international peace, while saving hundreds of billions of dollars 
annually through reduced military budgets. We can save hundreds of billions 
more by creating a food system that substantially reduces massive health 
problems such as obesity, cancer, and asthma. We can dramatically curtail 
environmental pollution, most of which results directly or indirectly from 
fossil fuel use. We can help Americans become more skilled and more 
self-reliant, and more prone to volunteer in community-based programs-and 
they will be happier as a consequence. We can reduce our nation's political 
divisions by calling forth qualities of character prized by both liberals 
(concern for the welfare of others) and conservatives (local autonomy and 
self-sufficiency).

In the end, what is accomplished by this enormous collective effort will be 
not merely the reversal of a historic economic and environmental calamity, 
or even the rebuilding of the nation's infrastructure, but the revival of a 
civilization-and the creation of a sustainable foundation for the 
accomplishments of future generations.

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