Obama, renewables, greenhouse gases and Kyoto

Atul Chatterjee
To take the last first. The US is responsible for more than 25% of the carbon emissions in the world which are being strived to be reduced by the Kyoto protocol. And while it has signed the protocol, it has not ratified it. Many would like to see the country ratify it, but few expect it to do so.

Letīs see what Obama does about it, more likely nothing, it would involve ruffling too many feathers in the US, so as a start we cannot expect him to do anything on this score.

He has been talking of renewables. It is almost impossible to think that renewables can substitute the electrical energy production needs of American which is well near the 5500 kilowatt hour per head per year. However a start has to be made.

Here we will disregard the total energy needs of the Americans which includes petroleum products and natural gas which is needed for heating and transportation.

The effort has to be made in striving for reduction in electrical energy use, arising from fossil fuel generation, much as many utilities would hate to see. Some examples from around the globe would serve as a path beacon for the US.

Solar energy for heating and producing electricity. Installation of solar heaters would be effective in most parts of the US. If the country can think of a multi billion bailout for banks it can well think of providing a capital subsidy to residential homes installing solar heaters. In parts of India installation of solar water heaters earns the residential home a reduction in its electricity bill.

Solar photo voltaics (PV) that generate electricity are being fixed on top of houses in Germany which will provide electricity to the grid. At present they are allowed to sell that electricity. This could be will done in the US. A mechanism to make utilities producing electricity from coal to step down production would have to be evolved, though pricing alone may do the trick since the generation cost of electricity from solar sources would be very low. (Capital costs would have to receive a subsidy)

The problem with such an approach is that it does not discriminate between nuclear, gas-fired or coal-fired generation. Since coal-fired and nuclear generation is lower cost than gas-fired it is gas-fired generation which would be hurt by cheap electricity from PVs. Therefore some form of direct capping of coal-fired generation would have to be taken.


Another area is energy saving devices, especially lighting. Cholorflurocarbon (CFC) tubes consume very little electricity for the same amount of light. In the city of Vishakapatanam, India residents are being provided these tubes at subsidized prices. It reduces the requirement of electricity. Such a step can be contemplated.

Making electricity more expensive is imperative. Higher charges for higher slabs is needed. If you use a lot of electricity you pay more than usual.

The other is time-of-day charges. Introduce charges for specified hours of the day e.g. lunch hour during office timings can meet with higher charges, that is the time that everyone forgets to switch computers to sleep mode or switch of lights, turn down heaters or air conditioner.

When you look at the graphs of electricity consumption for Japan you find a phenomena of lunch hour consumption of electricity dipping very sharply for the nation as a whole, not so for most other countries of the world. The Japanese as a nation are very conscious of their energy use. For the rest of the world higher charges have to do the trick.

The other renewables of wind energy, biomass, municipal wastes etc are Ok if you are thinking of supplying electricity to the grid. But all these would find it hard to compete with large scale utilities producing cheap electricity. Without initial start-up subisidies it is hard to see them survive.

Overall Obama can start a multimillion if not billion campaign for solar energy. This also will create jobs not just in terms of equipment but also in terms of installation. This can be targeted to the incremental requirement of electricity. This will make people more conscious of energy potentials. And on the other front saving of electrical energy through education which for starters means higher charges in a calibrated manner.

But there are regulatory issues involved in this which need to be untangled. Obama could well look at the whole legal framework. At present the odds are stacked against renewables in the US.

So letīs see what he can do best, he has to start in a small way before trying to evolve any national program.

Dwight Eisenhower gave the US a wonderful interstate roadways system. Obama will need help to evolve an energy highway that meets needs and curtails extravagant consumption of energy.
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Atul Chatterjee

Atul C holds a degree from the Delhi School of Economics.

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