 Okay, we're back. We're live. Welcome to Energy in America on ThinkTech. I'm your host, Jay Feidl. Our show today is called The Challenges of a Transition to Clean Energy. We're going to talk about a new study. A transition to low-emissions clean energy may not be so feasible and less costly, as we think. And we have to take a close look at exactly how fast we want the transition to go and how we actually think we're going to get there. If you want to ask a question or participate in a discussion, you can tweet us at TinkTechHI or call us at 808-473-2014. Our guest for the show is Lucien Boudirisi of E-Princk, who joins us by Skype. Welcome again to the show, Lucien. Hi, Jay. It's nice to be here. Great to have you. Sorry, you mentioned going in that there's new research just published by a researcher named David Victor of UC San Diego and the Booking Institute. Exactly. So David Victor plus about a dozen other top energy researchers, including Energy Modeling Forum out at Stanford, NOAA, the National Renewable Energy Laboratory, a broad cross-section of the researchers looking at the utility grid. And I think there was this view that they, and some of them even had published this before that we could quickly achieve 80% decarbonization of the US grid, the continental grid, at reasonable cost. I think that was it. And that this grid could be optimally configured with a high voltage transmission system with solar and wind plus infrastructure, right? And there were, you know, this could be done by excluding not just fossil fuels, but bioenergy and nuclear power, right? And the main option, but it's not becoming apparent, right? That there are several features that make this unattainable, at least across a reasonable time period. The first is that the expectation was we could curtail load at times when energy is not available. That's how long we could organize the grid so that the load would disappear. People would be willing to shed load, and they could do that at almost zero economic cost. We could deploy lots of storage. That was the key, right? And the third, we could have on standby widespread, cheap, supplemental, dispatchable capacity. Those three items at a closer look are now appear to be much more difficult than we thought. Clearly within, say, oh, I don't know, 2040, which I think is a number that the Hawaiians are quite interested in. 2040, 2045, depending on who you talk to, but it's right in that range. So I think that this, I have some slides here. And I think these can become, you know, how difficult this is and what the task before us looks like is to look at some of the data from this study. Okay. And the first slide is, of course, I can't see it when it comes up, so you have to tell me, but the first looks at the reliability of a proposed, what does it take to do 100% solar, wind, and hydroelectric power systems, right? Okay, the slides out there. Okay, so take a look at this. You see the, what I want you to look at on this chart is the capacity additions, you know, because in order to do this, you have to add a lot of capacity and you have to add it over a relatively short period of time. So you have to increase our hydroelectric capacity by 13 times. That would be the blue line. You're going to have to increase our wind capacity by 33 times current level. Solar would have to increase by 271 times. And so-called other, which would include coal and other things that people don't like, we would have to reduce that by 18 times. And the interesting things you would need to make this really work, you would also need virtually a 113 time increase in the storage capacity, an infinite supply of hydrogen, and you'd have to really load our whole system, our whole capacity would have to increase by 10 times. And that would have to occur through a short period of time, you know, between now and say 2040. So because of the previous modeling was much too optimistic and really didn't dig into it, these 12 plus researchers, and I'm most happy to give the site to you. I can email you the site if any of your listeners would like to read the report. It's not that long and it's very well done. Well, what interests me is that the tools we used before, which we, I guess you could say we have been using them for five, 10 years anyway, the modeling tools were invalid. And you've also said that they were invalid because we were too optimistic, or maybe that was an outcome of being of whatever was wrong with the tools. But what was wrong with the tools specifically that now we get to a point where we have to reconsider the tools? Yeah, I think that there's an interesting thing is constant in a lot of the work we do is that it's, there are two elements to any kind of responsible government policy. The first is what things cost is really important. You know, you can do a lot of stuff with the Aloha spirit, but you really can't change physics with that. And then the second part is that whatever strategy you undertake, it should be robust under uncertainty. You can't really know about the future. I mean, the government makes forecasts all the time, but the variance about that forecast is often many times that number. So policies which lock you into a specific number, a specific worldview, if you like, going forward tend to get you into a lot of trouble because the world changes, and you can't. The renewable fuel standard we have for the transportation sector is a case in point. We're running up against the limit on how much ethanol we can put into the transportation fuel system, even though the law says we have to keep putting more. That's bad law, actually. So we didn't think that one through too carefully. Yeah, right. I agree. Well, but let me throw this at you, Lou. It strikes me that money is not the sole factor here. There's also the factor of climate change. There's a factor of dealing with carbon emissions and saving the planet. And what exactly is that worth? If you made me king, if they still had a monarchy in Hawaii and you made me king, then I would say it doesn't matter what the cost is. We have to get there. We must spend whatever it takes to get there because of all the risks of not getting there. So economic modeling, in my view, has to have some other element of the larger picture for the planet, for humanity, for our living together on this earth. So, I mean, it's a reasonable position, I think that you could say. But it's important to translate that comment into something we can hang policy about. If you're saying to me that a failure to reach this goal for which there's huge uncertainty on the climate modeling, but a failure to reach some goals set by some bureaucrats or very smart researchers, means that it's the end of the world as we know it, and that we should impoverish ourselves. We should just move into caves and get rid of our cars and just live off of, you know, live off the way. That's a very interesting view. But there's a more optimistic view which says, okay, well, there's a lot of uncertainty, but man's pretty resourceful. And that one way to deal with climate is just to get rich. And if we get richer, we'll be able to adapt and adjust and come up with solutions. Money will buy it. At the beginning of time. So, I mean, I think it's important to operationalize this view in some concrete way. Yeah, well, you know, but there has to be, it has to, the whole thing has to be moderated by practicality and practicality that's all the study says. Yeah, yeah, yeah. Well, you know, what does this mean, though? This study is a little, you know, it's disturbing for the people who want to see clean energy pretty much at any cost. What do we do now? If you assume you accept this, this is the new model, except you assume you accept the study and, you know, the economists who are behind it, and you say, well, wait a minute, we can't just, you know, cruise down at any speed at any cost to renewable energy, because that's going to have secondary bad effect on the way we live from day to day and how much the loaf of bread costs and whether we can afford it, all that. So, how do we moderate the one with the other so that we come up with some kind of reasonable compromise? The question is, how can we move along a cost-effective gradient that gets us let's us move towards our goal, whatever that might be, in a very cost-effective way, not to try to undertake tasks for which the fundamentally the physics and the material science is just not there yet. So, if you look at the US, the revolution in shale gas production has fundamentally altered the amount of coal we use and has continuously dropped our emissions. So, our emissions are declining in the US. They have been declining since 1990. They're just for some people not declining fast enough. But it's just like the cafe stand, all the things we've talked about, when you get on the steep side, the steep part of that gradient, you impose very high costs and very low yields. And probably at that point, we should back away and say, okay, let's put some more money into research and development. Let's not just throw this money away in things that aren't working. Oh, I think that's a fabulous suggestion, that suggestion. And maybe somebody says, you have to, you can't adopt the research, the technological progress immediately, because you have to see how it works. And indeed, it may change. You may find something better next year or the year after. So, you have to watch it carefully before you jump on board. And maybe the way to deal with that problem is to do more research and do faster and throw more money at it. And then I disagree. There are more reasons to sort of the Bill Gates approach. But here's the question for life. Had you moved to this goal of 100% renewable, at a somewhat slower pace, at a somewhat slower pace, or maybe used to bridge fuel like gas, or you relied on your base load, the fuel oil for a bit longer, and you achieved a large percentage of your objective. But the electricity price in Hawaii was 35% less than it is today. Well, that's a choice that people should be able to at least debate and talk about. Yeah. But let me ask you a hard question. May I? It won't be hard for you, but for me, it sounds hard. Let's assume that we know this report. We accept this report, but we don't abide by it. We ignore this report. As we often ignore reports, actually, we shelve this report. And we cruise on, do regard for the fact of this report. We cruise on and we try to do it as fast as we can. And we throw all the money at it. And we shoot first and aim later, that kind of thing. So what happens then? How do you see that kind of track as a kind of pathway affecting our society? So if you think about the other day, there was a story in the Wall Street Journal in which the government of Hong Kong said it was removing all subsidies for electric cars ahead of time. Tesla sales went to whatever they were to zero overnight. They dropped to zero. And so the question is, and I think this is a political question, you can get the middle class to spend several billion, maybe 20, 30 billion dollars to give money to the upper class to do something, whether it's solar power or driving fancy electric cars, you can't get them to give 500 billion dollars. So if these things are costly, the people who are paying for it will rebel. They won't rebel right away, but eventually they'll say, you know, this electric bill is ridiculous. I'm not paying this anymore. Who is this nutcake, you know, utility commissioner or, you know, senator who's pushing this on? Yeah. There's a political reaction. Yeah. The political reaction is not unfounded. It's based on the fact, oh, do you guys know what you're doing? Because my bill has gone through the roof. Yeah. And that goes really to the core of the connection between energy and government and our society and our systems of governing ourselves, which is, you know, that's a pretty deep subject. And before we actually get into that, I would like to take a short break so I can sort of straighten my brain cells. Okay, Lou, we take a one minute break. You'll see. We'll come back after that. Okay, we're back. We're live on Energy in America with Lou Polirisi, who is the CEO of Eprink in Washington. He joins us by Skype as he does every couple of weeks. And we love having this conversation about energy in America. So as we left it, you know, the issue was, gee whiz, people would object to any increase or to any remarkable increase in the cost of energy because they don't like to pay any increases in anything, taxes, energy or anything else. And the question I put to you is, well, suppose they were informed and they really accepted the notion that it is life or death for the planet. It is life or death for the society. And we have simply got to have energy and we've got to be, you know, resilient and sustainable and, you know, all those things. And if they were fully cognizant of that, if they bought into that, then they wouldn't object so much. But they're not, they're not cognizant and they do object. And the problem is that, you know, our form of government allows them to object. And there's no way for any one leader, even a good leader, we don't have a good leader these days, but any one leader to convince them otherwise. So, you know, to me, this is inextricably interwoven with our form of government, our way of, you know, tumultuousness in democracy. Right. But I think, you know, I don't think people have been convinced that I think they're convinced that a lot of people are kind of lukewarmers, right? They give us, well, it's kind of a problem. Maybe we should work on it, but I don't really think it's the end of the world. So what's that? And so I think that's part of it. And I don't think I think because it's so far in the future, people have a real difficult time getting their head around. And because there's so much uncertainty, it's like, how much money should we spend to prepare for an asteroid hitting the earth? Oh, we should spend some, right? That's a pretty catastrophic outcome. But, you know, you got to look at the probabilities, the statistical analysis. You have to look at the outcomes of those probabilities. Yeah. But, you know, you mentioned a minute ago about electric cars. And, you know, we have an interesting situation here in Hawaii. The Hawaiian Electric Company has allowed for a rebate of $10,000 in addition to the federal rebate, federal tax credit, I guess it is, of roughly $7,500 on each electric car. So that means if I go out and buy an electric car at a sticker price of say $30,000, I get to pay, you know, $1750 for that car. I get that right. No, it's less than that. $13,000, $13,000, $1250, it's $1250. That's pretty cheap for a $30,000 car. So what happened was the thing was supposed to, this rebate, the $10,000 was supposed to expire 10 days ago or so. And guess what? They didn't really get the kind of response they hoped for, I think. I'm not sure why, but they extended the rebate of $10,000 benefit until September, which is, you know, which is a very interesting thing. Because I think, and you were saying this a minute ago, the metric here, the canary in the coal mine, is how interested people are in electric cars. Because that means a significant change in lifestyle. It means a short of these rebates, a significant expense too. And it means, you know, facing right up front, you know, to the inconvenient truth of what we're dealing with. So my question to you is, why do you think they extended this rebate? And should we extend all the rebates? Because once you give something away to people, it's hard to take it back. I mean, you know, there's a political support group that gets surrounded by the dealers, the people care about electric cars, people that build the charging stations. They say, what are you doing? You know, we have a nice, good thing going here. But what happens is the government runs out of money. And I'm telling you, this electric car thing is very interesting because right now there's a big fight in the Congress on what to do with the corporate average fuel economy standards. And they have this separate standard for California and New York, which the autos want a national single standard. And there's a lot of negotiations going on. And I think a lot of the people are saying, okay, well, we might ease up on the short term, but then you have to commit to a higher percentage of electric cars post 2022, 2025. You have to get to 3%. The autos are saying, look, we can't go to those higher numbers of electric vehicles without increasing the price of all our vehicles by $5,000 to $6,000 a year. To cover the development costs. Yeah. So the question is, there's a lot of people. And I'll tell you, here's the interesting, here's the politics of this, right? I can just see the politics of this. In 2018, you're going to have some Democratic senators from the Midwest. Maybe it's Debbie Stabenall, maybe it's Mikulski, maybe it's Sherrod Brown, Democratic senators from Ohio, Michigan. And Trump is going to be tweeting, you know, Nancy Pelosi, and there's going to be some layoffs in the industry anyway, right? And he said, look, I'm trying to fix this, but Chuck Schumer and Nancy Pelosi want to tell you what kind of car to drive. And you need to get these Democratic congressmen to talk to them, or you need to get rid of them. Interesting. You watch this. I don't, people think Trump is stupid, but he's not too stupid to figure that out. Oh, it's, you know, it's, in the end, it's politics. And worse than that, in the end, it's the whole, the whole system of leadership and how you, you know, I mean, in another world, in another country, in China, for example, Xi Jinping would get out there and say, all the cars will be electric by this year. But they're trying to do something similar to that. They're having very aggressive targets. Let's see what happens. Yeah. Well, remember Volvo? It was only a few days ago. Volvo announced that they were, by a certain year, I don't remember, maybe 2020, 2025, they're going to make all their car, all their cars, and electric cars. Well, actually, I don't think people read that statement carefully. They're going to make all their cars hybrid electric or all electric. Remember, Volvo has only 0.8% of the U.S. auto market. So you have to sell a lot and I can send you a chart. You know, all the expectations, I want you to know, all the expectations on electric car sales haven't come close to this. I know that. Yeah. And why, why do you think that is? Because people are not all that excited about electric cars. They want to hold on to their fossil cars. One is range anxiety. You shouldn't have range anxiety in Hawaii. But the second is the time it takes to charge the car. I mean, people won't make a left-hand turn to save a nickel a gallon. They're not going to spend 30 minutes even getting a minimal charge. They're busy. So you're coming to Hawaii. We're thinking about Hawaii. And certainly, as you said, you know, in connection with this study, it should give this study should give Hawaii pause. So how would you integrate this, the truth or at least the reported truth in this study, the outcome of this study into Hawaii's planning? So I think, you know, Hawaii has some special conditions, of course, that are not, you know, they have a lot of sunshine so the solar should be amenable, but they also have these fundamental grid problems that are inherent in going to 100% renewable. And I really think we talked about this many times, but it's worth repeating. You need a hard-headed and honest analysis of what this costs. And then you have to ask yourself a very hard question. Is this the best thing we should be doing with this money? Even though it might be other people's money, like the citizens of Hawaii, is this the best thing we should be doing with their money in terms of the environment or climate? Is there something that money would have a much higher yield if we put it into either adaption or other kinds of strategies to move ourselves to a cleaner environment? Well, let's talk about what you mentioned before. That is research and development, technology. Certainly, you know, energy is technology. I mean, that's the bottom line here. And so the question is, when you say that we should give pause before we spend big bucks on, you know, on the straight ahead with trying to develop the grid, maybe without having all the technology that could come down the pike to do that, would you take that money or a fair share of it anyway and put it into research on new technology and then use that at a later time to get even a better jump on how to deal with the grid? Absolutely. I mean, we should be probably spending more money on not demonstration projects and not commercial deployment, but basic research or fundamental research. I mean, if you look at the just take the physics of the ion battery, it's never gets more than its density. It's a capacity to deliver power. Still is a small fraction of a gallon of gasoline in terms of pure density. That's why all these views of gasoline is going to disappear. Ridiculous. There is nothing that can deliver the, you know, transportability, the fungibility and the density of power that you get out of a gallon of gasoline or you get out of a million cubic feet of natural gas. It's just a lot of dense energy in those fuels. Yeah, we have to find a path here. And that is pretty much what the Hawaii Energy Policy Forum is planning for its discussion on August 28th. And I'm inviting you, in fact, I'll take you by the hand to that program, Lou. And I'll introduce you to everybody there. And you can participate in that discussion. You can hear what they have to say. And we can raise this issue. We should raise this issue at that time. Yeah, I'm sure this debate must be going on in the legislature and in academic circles in Hawaii. Yes, it is. But what's interesting, though, is we've had a number of shows in Toralia with, you know, the Hawaii Natural Energy Institute, which is a research organization at the University of Hawaii. And it does research, you know, in energy. And they are doing the kind of basic research you're talking about. It's not ready for market, a lot of it. But they're working hard on it. And they have world-class researchers from many, many countries here. They brought them in. They recruited them. And so, you know, in terms of that possibility, that step, I think Hawaii is actually doing that. And when you're here, I'd like to introduce you to some of them and see what you think. Great. I look forward to it. Well, thank you, Lou. Lou Pulirisi, the CEO of EPRINC, joining us today again on Energy in America. So enjoy these conversations. So nutritious. Appreciate it every time. And I'll talk to you again in two weeks, right? Absolutely. Thank you. Aloha.