sgouridis 2009 ted talk energy credits
TRANSCRIPT
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ERGOs(Re)architecting the financial system for a post-carbon economy
Sgouris Sgouridis
in collaboration with Scott Kennedy
The Pilot January 28, 2010
Technology Entertainment Design
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Moneyis
abeliefaboutabelief
generatedbydebtinafractionalreservebankingsystem
furtherexpandedby(unregulated)securitizationofthedebt
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The1970s
0
0.5
1
1.5
2
2.5
0
1
2
3
4
5
6
1979January
1979February
1979Marc
h
1979Apr
il
1979Ma
y
1979Jun
e
1979July
1979August
1979September
1979October
1979November
1979December
1980January
1980February
1980Marc
h
1980Apr
il
1980Ma
y
1980Jun
e
1980July
1980August
1980September
1980October
1980November
1980December
1981January
1981February
1981Marc
h
1981Apr
il
1981Ma
y
1981Jun
e
1981July
1981August
1981September
1981October
1981November
1981December
1982January
USGDP&O
ilPrice
(NormalizedN
ominal)
Data sources: Bureau of Economic Analysis & Energy Information Administration
Oil Price
GDP
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The2000s
USGDP&O
ilPrice
(NormalizedN
ominal)
9.2
9.3
9.4
9.5
9.6
9.7
9.8
9.9
10
10.1
0
2
4
6
8
10
12
14
16
18
20
2007January
2007February
2007March
2007April
2007May
2007June
2007July
2007August
2007September
2007October
2007November
2007December
2008January
2008February
2008March
2008April
2008May
2008June
2008July
2008August
2008September
2008October
2008November
2008December
2009January
2009February
2009March
2009April
2009May
2009June
2009July
Data sources: Bureau of Economic Analysis & Energy Information Administration
Oil Price
GDP
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Tippingthehouseofcards
Electricitybill.Waterbill.
Taxifare.
Metroticket.
Gasprice.
Foodprice.Hotelrate.
Mortgagepayment.
Aggregatepricingofaserviceresultsinembedding:
energyrequirements(hidden) externalities(unpricedandunknown=doublyhidden)
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2000s:firstcollisionofrealandimaginaryeconomies
notyetcriticalasfossilwealthremainsaccessible
but
whatifacommunitydesiredtorelyonrenewableenergy
and
maintainstandardsofliving?
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AutonomousGrid
Unlimitedfuel
AutonomousGrid
Fuel/resourcelimits
InterconnectedGrid
Unlimitedfuel
InterconnectedGrid
Fuel/resourcelimits
Fossilfueldominant
capacity
limited
Weak Strong
Weak
Strong
Energy
Constraints
Capa
city
Const
raints
ConnectedSustainable
City
Fossilfueldominant
excesscapacity
Renewable Energy Targets
AutonomousSustainable
City
Hydro/Nuclear
dominant
VariaonsofEnergySystems
EnergyIndepen
denceTargets
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SustainableCityNeeds
NetZeroCarbonenergybalance100%renewable
Strongenergyconstraint+peakloadmanagement Energyaccounting:transparentandauditable
Demandmanagement
Incentivesforefficientenergyuse Mechanismforinformeddecisionsonenergyuse Simplicity,flexibility,commonality
Residentenergy/environmentawareness
Innovationandreplicability
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Commitmenttoastrongenergyconstraintcouldleadto
aformoftechnocraticdictatorship
canwemaintain
freedomofaction,
promoteequality,and
meetresourceconstraints?
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ergoErgo
introducingenergyasaparallelcurrency
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Ergo:EnergyCreditsSystemConcept
Ergo:Unitofenergy-basedcomplementarycurrency i.e.withafiatcurrencyexchange
Ergosare:
Issuedproportionallytoenergyoutput
Allocatedbyafacilitatingauthoritytosubscribers Surrenderedforenergyportionofservices Tradedinaspotmarket
AnErgoEnergyCredit(EEC)systemmakesenergytangibleandfungible.
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ErgoDefinionTangibleEnergy
1Ergo=1EnergyUnit(e.g.kWh)
ServiceshaveanErgopricecomponentreflectingtheirtruedirectandindirectenergyneeds
Ergosrepresentafiniteenergyresourcethatcanbeallocatedequitably
Ergoshaveanexpirationdate
Ergoscannotbehoardedspeculativelybutare
surrenderedforaservicetransaction
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ErgoDefinionFungibleEnergy
ErgoshaveasubscriptionfeeForgenerationcostrecovery
Ergosaretradedasymmetricallyandhaveaspotpricein$
Revenueneutral;externalitypricing
AconservingusercansellexcessErgosatthespotprice
Auserabovebudgetcanbuyandimmediatelysurrender
Ergosatthespotpriceinexchangeforadesiredservice
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ProposedIni)alErgoCoverage
ErgoUsers:Residents
Businesses
Visitors
Cityauthorities
ServiceCoverage:Electricity
ClimateControl-HVAC
Water&hotwater
Transportation
Wastedisposal
Commonutilities
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ErgoIssuance
ErgosissuedcentrallybyCityEnergyAdministration(CEA)reflectenergygenerationbudget
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ErgoMonthlyBudget
EnergyForecast
BudgetCarryOver
ForwardCredits+ +=
Energy
Forecast
ElectricityGeneration
Forecast
Biomass&Thermal
GenerationForecast
+Adjustment
Factorx=
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ErgoAllocaon
Ergosareallocatedtosubscribersbasedonaflatsubscriptionfeeandequitableallocation(otheroptionsexist)
Commercial user allocation determined on case by case and by benchmarking
ErgoMonthlyBudget
ResidentialUsers
CommercialUsers
CommonUtility+ +=
VisitorReserve
CEAExports
Pre-allocatedErgos
+ +
+
ErgoperUser
ResidentialUserBudget
NumberofUsers/=
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ErgoPricing
Subscriptionfee Costrecovery,tier-pricing,subsidizedetc.
Ergospotprice
Updatedregularly BasedonthecomparisonofCumulativeDemandProfile
vs.theCumulativeSupplyprofile
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ErgoPrice
BaseErgoPrice
ShortTermCumulative
DemandGap
+ f (= )
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ErgoPricingMechanism
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CumulativeDemand Curve
CumulativeSupply Curve
Cumulative Demand Gap
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ErgoMarket
ErgoMarketdiffersfromtraditionalenergymarkets:
1. itisretailbased,
2. userscannotspeculativelytradeErgos,and3. userscannothoardErgosduetoexpiration
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ErgoForwardMarkets TwoTypes:
Pre-allocatedErgos ErgoFutures
Accommodatetemporarycapacityshortfalls-Pre-allocatedErgos UsedasregularErgos Trading-offcarbonoffsetswithPre-allocatedErgos Potentialtofinancefutureincrementalcapacity Supportsenergybalanceaccounting
Financeinvestmentinfuturerenewableenergycapacity-ErgoFutures Fullytradable Activationdate(convertedtoregularErgos) Userpriceriskmanagement Improveddemandforecasting
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UserExperience
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Seamless&uncomplicated
Relyon:
smart-phonetypedeviceswithaccesstouseraccounts
wirelesscommunicationwithErgo&$debitdevices
Pre-programmedmodesandintuitiveambientindicators
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OfCiesandSpaceships
SoonerthanlaterGeonautsonSpaceshipEarth
willactascitizensofa
SustainableCity
Energyisamostpreciouscommodity
Andonlyitsappreciationwillheraldthetransitiontoasustainableeconomy
Photo credits: Robert & Shana ParkeHarrison, www.geos.ed.ac.uk, www.masdar.ae