11 Jun 2011

Calculating the REAL cost of major energy sources – who has a credible model?

Written by theenergyfix


The Energy Fix appeals to credible economic modelers to devise a means to calculate the real cost of energy sources. This includes assigning dollar costs that don’t exist yet but if they did, would help energy users and policymakers around the world grasp the benefits of moving to more sustainable sources of electricity and transportation fuels.

A few attempts have been made to establish the full life-cycle costs of certain sources of energy and the cumulative burden they impoose on the environment, human health and the economy. Yet with all of the brainpower at academic institutions such as Harvard, Duke, Cal-Berkeley that can shake free of political ties that bind think tanks and government labs, where there is a will — with a band of bright students coached by seasoned professors and retired energy professionals — there should be a way to tackle this in a comprehensive manner.

A new accounting could be dubbed “ecological economics” and join the academic disciplines in the nation’s leading schools of engineering and economics. A recent Harvard Medical School study, featured here on The Energy Fix Feb. 21, DID perform a thorough assessment of the entire industrial coal process – extraction, transport, processing and combustion — crunched the numbers. Researchers included all known, so-called externalities (such as healthcare costs from pollution, or damage to ecological resources/services) in their analysis to account for the complete “life cycle” of coal in raw, monetary terms. Their conclusion: “We estimate that the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to over one-half of a trillion dollars annually.”

Credit: LSI Industries and their LED lighting products

So, it IS possible.

While the time, energy, personnel and resources needed to tackle such an endeavor are no doubt enormous, so are problems posed by harmful if not life-threatening pollutants emitted into the air and water making the challenge of sustaining society a larger task each passing year.

One approach could be to partner with a global media organization such as Silver Spring, MD-based Discovery Channel as a means of reaching out to curious and qualified minds willing to join the cause. Discovery already helps educate consumers about how much electricity is consumed by various appliances in the home. It could work with the Pew Research Center and be spearheaded by former Michigan Governor Jennifer Granholm who is now championing clean energy as a Pew advisor.

Another approach could include funding from foundations that care deeply about the environment (e.g. Google.org, The Energy Foundation, the William and Flora Hewlett Foundation, the Rockefeller Brothers Fund).

Calculating one’s “carbon footprint” — be it a business, a home, a trip to a business conference — is now a widely adopted practice. Eventually, so too can be this ever more valuable formula for fixing what our energy habits are doing to humans around the world.

No doubt there is bound to be one controversy after another over assumptions that need to be made. Established U.S. energy interests will defend the purchase price of their fuels as among the lowest in the world. Environmental activists will be seen as inflating various costs and their consequences. But somewhere in between, a series of common denominators can emerge.

Among the very tough ‘nuts’ that need to be cracked include:

  • What is the price of a human life spent defending democracies’ access to fossil fuels?
  • What are the costs of storing nuclear waste? What about transporting it to a central underground repository such as Yucca Mountain in Nevada?
  • What does it take to restore lands and bodies of water to their previous state after large oil spills?
  • What are subsidies costing the American taxpayer not just for oil, natural gas and coal, but for all forms of renewables?
  • How about the costs of building an infrastructure for electric vehicles in major metropolitan areas

Who can develop a credible model?  Who is up to the challenge?








1 Comment to Calculating the REAL cost of major energy sources – who has a credible model?

  1. DiogenesNJ's GravatarDiogenesNJ
    July 11, 2011 at 1:09 pm | Permalink

    You are missing a European effort along these lines. Google the ExternE project, which attempted to do exactly this to establish the risk for all electric power generation technologies, normalized for generating capacity as deaths per terawatt-hour produced.

    The results may surprise you. Nuclear power, including the effects of Chernobyl (using WHO estimates) is by far the safest power generation technology when the entire life cycle is considered.

    Take a look at:


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