EduNecessity, Possibility & Difficulty.

Kickthe Fossil Fuel Habit

Cleantech Lead Advisor, MaRS Discovery DistrictEntrepreneur and InvestorAuthor, Kick the Fossil Fuel Habit

www.tomrand.net

Tom RandP.Eng., Ph.D.

Economic PossibilitiesEconomic Developers Association of Canada

Peterborough, October 3rd, 2011

© 2001 Eco Ten Publishing

The Low Carbon Economy…

is Necessary & Urgent

“climate change … could alter the way we live in the most fundamental way … It is life itself that we battle to

preserve.“Margaret Thatcher, to the UN General Assembly, 1989.

The Low Carbon Economy…

is Necessary & Urgent

“Business-as-usual commits us to 2 degrees of warming by 2021.“

Best-case scenarios now lead to 4 degrees plus …

Which is global chaos.

The Low Carbon Economy…

is Possible

The Low Carbon Economy…

Will be Difficult

“The nation that leads the world in creating a new clean energy economy will be the nation that leads the 21st century

global economy.“Barak Obama, 2009

... But also opportunity

Necessity: Climate ChangeEconomic, Moral, Existential Opportunity

Necessity: Climate ChangeThe “Skeptics”

DELAY

Bjorn Lomborg

WiliamNordhaus

AGNOSTIC/SCOFFERS

Margaret Wente

MichaelEconomide

s

DENIERS

“Conspiracy”

“Junk”

Necessity: Climate Change

DELAY

Bjorn Lomborg

WiliamNordhaus

AGNOSTIC/SCOFFERS

Margaret Wente

MichaelEconomide

s

DENIERS

“Conspiracy”

“Junk”

GET ON WITH IT !

SirNicholas Stern

Necessity: Pace of Cleantech Adoption

Possibility: Successful companies …

Commodity-based supply chains.

Scalable, simple manufacturing processes.

Low technical risk; financeable.

Leverage existing infrastructure.

Difficulty: Scale & Speed

Lab to Prototype: Technical Viability

Commercial Scale: Economic Viability

Infrastructure Scale: Displace Fossil Fuels ?What do

you get for

$1 Trillion

Cleantech Economics:Market Push vs Market Pull

Technology

MaRS, Venture Capital,Entrepreneurs

POLICY: Green Energy Act

SDTC, etc.

Risk = Probability (High) * Consequences (Severe)

Create Global Opportunities

Lowering Risk: Smart Policy

Ensure Long-Term Growth

EFFICIENCY

More GDP ($)-

Less Energy

CLEAN ENERGY

-Less

Carbon

More Energy

Necessity: Lower carbon emissions

Possibility:Clean Energy

BioFuels

Kick It:BioFuels

“There’s just not enough fresh water and arable land to produce enough biofuels to replace the

petroleum”Dennis Bushnell, chief scientist, NASA Langley Research

BioFuels

BioFuels

Upper limit:

Replace approx 1/3 of oil supply.

BioFuels

20,000 miles of high-speed track and trains, and enough transit to offset 7.5 billion car trips.

Efficiency:

Efficiency:Buildings – Low Hanging Fruit

Efficiency:Buildings – Low Hanging Fruit

EfficiencyBuildings – Low Hanging Fruit

Technology

Geo-exchange

Solar Thermal

Solar PV (ONLY SUBSIDY)

Power-pipetm

LED Lighting/switching

Energy Reductions

40 %

7.5 %

15%

7.5%

5%

75%TOTAL

5%of capital unlocks

75%Reduction

AT A PROFIT

Buildings – Low Hanging Fruit

Efficiency

Efficiency

Economic CompetitivenessEn

erg

y /

$

Efficiency ($ / Energy)

Increasing Wealth

Japan, Germany

Canada

*

*

China

India

Developed

Developing

* US

Efficiency

ReduceG7 energy use by half…

and have $500

billion left over.

Efficiency

Solar

Energy production equal in cost to the Tar Sands… and …

Replace half US coal-based electrical production

.

Solar

Replace 20% of US electrical production.

Wind

Geothermal

Replace 2/3 of US coal power.

Hydro

Develop global potential tidal power … equivalent to US electrical production.

Oceans

www.kickthefossilfuelhabit.com

April 10, 202334

Continental – Grid-Balancing,

Reliability.

Local – Demand Response

Storage

Energy Internet

SolarBiomass

Wind

Wind

HydroGeothermal Tidal

Wind

Wind, Tidal,Hydro

Biomass

Wind

Solar

Wind

Energy Internet

Risk = Probability (High) * Consequences (Severe)

Create Global Opportunities

Lowering Risk: Smart Policy

Ensure Long-Term Growth

Lowering Risk: Smart Policy

•Set target, no priceCap and Trade

•Set price, no targetCarbon Tax(& Dividend)

•Sector-specificRegulation

•Technology SpecificFeed-in Tariff

•Low-cost capitalGreen Bonds

Lowering Risk: Smart Policy shapes markets

•Set target, no priceCap and Trade

•Set price, no targetCarbon Tax(& Dividend)

•Sector-specificRegulation

•Technology SpecificFeed-in Tariff

•Low-cost capitalGreen Bonds

Policy:Green BondsShifting Financial Resources - Capital

Government backing

High RiskHigh Rates

Savings/Money Markets

Policy:Tax & DividendShifting Financial Resources - Spending

Dividend

Tax

Spend

High CO2

Low CO2

Worst case estimates :

It will take 1-3 years longer ….

Cost: High or Low?

To double global average income. By 2050.

www.tomrand.net

Tom RandP.Eng., Ph.D.

Thank you

Time

PowerPower

Release thisEnergy

Store thisenergy

Kick it: Minimal StoragePeak Shifting

Difficulty: Hard Truths

www.kickthefossilfuelhabit.com

April 10, 202344

• Higher Costs• Job Dislocation

• Capital Assets• Psychology

• Lots of it• Debt Crisis

• Shape Markets• International

Co-operation

Skeptical Public

Corp Inertia

CapitalPolicy

Technology/Scienc

e

Control

Environment

Creates Marke

tControl

Environment

Clean Technology

Shape/Create Marke

t

Lowering Risk: Smart Policy shapes markets

Kick It:Storage

Kick It:BioFuels

Enough salt-water irrigation and processing capacity to:

Replace half of the world’s oil supply.

20,000 miles of high-speed track and trains, and enough transit to offset 7.5 billion car trips.

Kick It:TransportKick It:EfficiencyTransport

Possibility:Clean Energy