Economics of Renewable Energy

Summary:  In the U. S. regional and state initiatives are in place aiming to reduce emissions of greenhouse gases significantly.  Use of renewable energy sources plays a prominent role in these programs.  This post presents a discussion of wind energy, solar photovoltaic electricity, and solar thermal electricity, focusing on the economics of utility-scale projects.  Generally, each of these modalities has already attained, or is projected to attain, economic competitiveness with fossil fuel-driven electricity generation, based on evaluation of the “levelized cost” of electricity.  A previous post on this blog presented the harsh economic and humanitarian costs arising from extreme weather events tied at least partly to global warming.  Here it is concluded that those costs and the investments needed to construct renewable energy facilities are broadly comparable.  Renewable energy is preferable in order to mitigate the need for dealing with the harms caused by extreme weather events. 

Introduction.  Warming of the long-term average worldwide temperature due to accumulation of greenhouse gases such as those that result from burning fossil fuels has been proceeding with increasing severity in recent decades.  In a recent post entitled “Economic Costs of Extreme Weather Events Due to Global Warming” we assessed the economic impact of three events tied to extremes of weather that could be ascribed at least partly to global warming.

The U. S. has failed to implement a national energy policy that addresses global warming.  In the face of this void some regions and states in the U. S.  have implemented their own initiatives to reduce greenhouse gas emissions and to seek to mitigate global warming.  For example, the state of California, both by itself and as part of the Western Climate Initiative, is actively taking steps to limit its greenhouse gas emissions, including the solar power projects described below.  Expanding renewable sources for electricity is an important aspect of such programs.  Here we assess economics and energetics of three types of renewable energy, wind power, solar photovoltaic electricity and solar thermal generation.  (The discussion of these topics is relatively lengthy.  Some readers may wish to jump directly to the Conclusion section at the end.)

Renewable sources of energy in the U. S., as of 2009, constituted 8% of the total supply, according to the U. S. Energy Information Agency’s Annual Energy Outlook 2011 (AEO).  Nuclear energy, which is not responsible for any greenhouse gas emissions once the plants are in operation, accounts for 9%. (Manufacture of cement, and refining of metals, which are used in construction, are both very greenhouse gas-intensive.)  The predicted levelized costs of generating electricity (see indent following the graphic) from coal, uranium, wind, and natural gas using a combined cycle generator are shown below, for the years 2020 and 2035.

Price in cents per kWhr for electricity generated from four sources predicted for 2020 and 2035.  The contributing factors are blue, capital costs; green, fixed costs; magenta, fuel and other varying costs; and orange, incremental transmission costs.

Source: U. S. EIA, Annual Energy Outlook 2011; http://www.eia.gov/forecasts/aeo/pdf/0383(2011).pdf.

Levelized Cost of Generating Electricity models the expected cost including all factors over the operating lifetime of a project.  A model includes the capital cost and the future discounted cost of the capital, any investment tax credits and preferential land use credits, fuel costs where applicable, the expected lifetime of the installed facility, its peak power output, the capacity factor accounting for the fraction of the time that power is actually generated, operating and maintenance costs, and transmission and distribution costs.  In the case of fossil fuels, the levelized cost does not include costs associated with considering waste CO₂ as a greenhouse gas and its harmful effects on global warming.

Considering the levelized cost for wind power in the graphic above, the capital costs decrease from 2020 to 2035, presumably as more units are installed leading to economies of scale.  Importantly, wind power has no variable costs such as those arising from fuel costs.  The transmission costs are greatest for wind power of all those shown, perhaps because wind installations require completely new transmission lines.  For natural gas, using a combined cycle generator (one in which gas is first burned in a jet engine-like turbine, then the hot exhaust gases are used to heat water to steam, producing additional turbine-driven power) the levelized costs remain approximately unchanged between 2020 and 2035.  The biggest expense in natural gas is the price of the fuel, which can be quite volatile.  The cost for the other three modalities decreases significantly between 2020 and 2035.

The graphic below shows that the projected contributions in 2020, 2030, and 2035 of generating capacity from geothermal power, solar power, biomass-fueled generation and wind power all increase significantly over the actual 2009 level, as reported by the AEO.

Sources for renewable electric power generating capacity. Black, municipal solid waste/landfill gas (MSW/LFG); brown, geothermal energy; orange, solar; light blue, biomass; and green, wind. Source: U. S. EIA, Annual Energy Outlook 2011; http://www.eia.gov/forecasts/aeo/pdf/0383(2011).pdf.

In the graphic above, wind energy is shown as remaining relatively constant in the future years.  The AEO’s projection giving this result is based on expiration of an investment tax credit for wind energy before 2020, which discourages projected further development of wind.

Considering the total amount of electric generation in the U. S. in 2009, nuclear energy provided 20%, hydroelectric generation provided 7%, wind provided 1.8%, geothermal generation provided 0.2%, and solar provided 0.02% (USEIA).

Wind Energy.  According to the American Wind Energy Association’s (AWEA) Annual Market Report for 2009, more than 10,000 MW of wind generating capacity was constructed that year (see the left-hand multicolored bar for 2009 in the graphic below).

Annual additions of generating capacity (blue and multicolored bars), and cumulative total of installed generating capacity (green bars) from 1995 to 2009.

Source: ©AWEA Annual Market Report for 2009 http://www.awea.org/learnabout/publications/upload/Annual_Market_Report_Press_Release_Teaser.pdf

AWEA points out that wind power capacity installed in 2009 represented 39% of all new generating capacity added during that year. 

The wind industry employed 85,000 people in the U.S. in 2009.  There were over 200 operating facilities manufacturing wind energy equipment in the U. S.  Nine corporations making wind turbines share the market currently.

Cost of wind energy.  Specifying costs for installing utility-scale wind turbines results in varying numbers.  Factors included in arriving at final numbers may differ regionally and over time.  The first graphic above shows that wind energy is fully competitive with coal-fired power, and becomes more competitive with natural gas by 2035.  Here are some additional examples of identified costs for onshore (land-based) facilities.

Wikipedia provides an estimate by the British Wind Energy Association for wind generated energy (see Details below for the distinction between electrical power and electrical energy) of US$0.05-0.06/kW-h as of 2005.  Such a cost basis was evaluated as being comparable to the energy cost from new coal- or natural gas-fired plants providing electrical energy.  These costs for fossil fuels do not include recognizing that the CO₂ produced by burning fossil fuels is a waste product responsible for global warming which creates further economic costs and societal harms (see the post “Carbon Dioxide – The Waste Product of Our Energy Economy”).  In addition, in the U. S. generation of electricity by wind entitles the producer to a Production Tax Credit of US$0.01/kW-h. 

Clipper Windpower, Inc. reports that from 1989 to 2004, as exemplary wind turbines increased in rated power output from 25 kW to 1,500 kW the cost fell from $2,600/kW of capacity to $800/kW.  The overall cost of electrical energy is calculated as US$0.0617 per kWh in 2004 before the production tax credit. New technologies have improved the efficiency of generation as well as the ability to interface with the electrical grid. 

Details.

The rate of delivering electricity is the power, identified in watts, kilowatts (thousands of watts; kW), megawatts (millions of watts; MW) or gigawatts (billions of watts; GW).  The energy delivered is the power averaged over time, or watt-hours (w-h), or KW-h, or MW-h. 

 AWEA offers a detailed list of considerations in creating a wind farm project.

Understand the wind pattern.  A minimum average wind speed of 11-13 miles per hour (mph) is needed.

Distance from existing grid lines.  Transmission lines cost several thousand dollars (US) per mile.  Siting should minimize this distance.

Access to land. Arrangements for land use, whether public or private, need to be made.  During construction, load-bearing roads need to be available or built.  Local opinion should be favorable.

Arranging capital.  As of 2009, AWEA estimates wind power requires about US$2 million per MW of power generating capacity, installed.  For economies of scale, a project should include several turbines, say at least 20 MW, translating to a cost of US$40 million.

Contract for a buyer of the generated power.  Long term purchase commitments should be arranged, covering an operational lifetime of up to 30 years.

Siting arrangements.  This factor includes considerations such as visual and sound esthetics, multiple uses for the land, environmental regulations, and community acceptance.

Wind energy economics.  Wind speed and rotor length affect the amount of power generated.  Financing modalities, including interest rates and investor relations, affect overall profitability.

Zoning and environmental permitting.  This is a major ancillary requirement that needs to be satisfied before a project can begin.

Understand the characteristics of the turbines.  Various models and designs for turbines exist.  These should be explored and understood.

Make arrangements for operation and maintenance.  Reliability of turbines installed is important.  Qualified operators and service personnel should also be available.

As discussed by Wikipedia, a wind turbine, or turbine farm, produces only a fraction, called the capacity factor, of the total possible energy that could be generated, because of the intermittency of the wind, and because the grid load may not require the full power at all times.  Typical capacity factors range from 20% to 40%.  According to the U. S. Department of Energy’s Office of Energy Efficiency and Renewable Energy, new wind turbines achieve capacity factors of 36%.  Let’s assume 35%, so averaged over one year a 1 MW turbine will actually deliver power at 0.35 MW, and provide a total amount of energy of 0.35 MW x 24 hrs/day x 365 days/yr, or 3,066 MW-h. 

Solar Photovoltaic Renewable Energy.  There are two differing approaches to using solar energy for electric power.  Photovoltaic (PV) energy uses semiconductor films, made of ultra-pure silicon, to convert the sun’s energy directly into electricity.  Solar thermal energy uses extensive arrays of mirrors to concentrate sunlight onto a single heat-absorbing element containing a high-boiling heat exchange liquid.  The liquid then heats water to steam which drives a turbine to generate electricity.  Both modalities require large land areas to provide enough generating scale to be commercially significant.

About half the cost of solar PV is consumed by the silicon PV elements themselves.  Solar PV produces direct current (like a simple battery).  In order to be introduced into the commercial power grid, this has to be converted into alternating current using a device called an inverter.  In order to minimize equipment failures many inverters are used to connect a relatively small number of PV cells.  Much of the remaining cost of solar PV is taken up by the inverters, the circuits controlling their operation, and the cabling that connects them. 

In a recent description of a solar PV project, Solargen Energy Inc. summarized its new installation using land under existing power transmission lines.   Its cost is minimized because the company uses newly-developed thin-film silicon PV cells, which can be as much as 99% cheaper than older conventional PV cells.  For this project Solargen states

The project installs 250 MW of solar PV capacity, which is expandable to 1,500 MW;

          It requires 1,000 acres;

          It uses 550,000 thin-film solar PV panels;

          Its cost is $750 million; and

          It has contracted for at least 20 years of delivery of the resulting power.

This project is to be installed in California’s Central Valley.  Because of California’s renewable energy policy, and federal tax credits, there is considerable incentive for developing renewable energy sources such as this.  In addition, as solar PV is expected to expand, its cost per installed watt capacity is expected to fall.

The U. S. Department of Energy announced on June 30, 2011 that it is offering conditional commitments for partial loan guarantees totaling almost US$4.5 billion for three solar PV projects in California.  The projects utilize cadmium-telluride PV films made by First Solar, Inc., rather than the more usual silicon.  When completed, the projects together will generate solar electricity using utility-scale inverters for stable continuous delivery of power to grid power companies.  The total power rating is expected to be 1,330 MW (1.33 GW), which should deliver enough electricity for 274,000 homes.  During construction these projects will create 1,400 jobs for electrical and installation work, and subsequently additional jobs for maintenance and operation.  It is expected these farms will eliminate 1,810,000 metric tons of CO₂ emissions per year.

The National Renewable Energy Laboratory (NREL) published an analysis of solar PV in February 2011.  We will focus here on utility-scale solar PV.  NREL analyzes that the cost per watt for installing solar PV facilities falls dramatically with the scale of the project (see the graphic below, in which both axes are logarithmic scales)

The solid and dashed red lines refer to utility-scale solar PV farms, showing the installed system cost in US$/watt of peak DC electric capacity (before conversion to AC and feeding to the grid).  Both the capacity axis (horizontal) and the cost axis (vertical) are on a logarithmic scale.

Source: National Renewable Energy Laboratory, U. S. Department of Energy http://arpa-e.energy.gov/LinkClick.aspx?fileticket=2WF9d-ukumA%3D&tabid=408

The various factors involved in contributing to the cost of a utility-scale PV farm are shown in the following graphic, referring to the three bars on the right for, respectively, silicon PV with fixed mirrors, silicon PV with moveable mirrors, and cadmium telluride PV with fixed mirrors.

Cost factors contributing to the installed cost of a utility-scale solar PV farm (187.5 MW), referring to the three right-most bars.  The contributing factors, reading from bottom to top of each bar, are costs for the solar PV module, the DC-to-AC inverter, installation materials, a tracker (purple, only in the fourth bar, turning the panels to face the sun), installation labor, permitting & commissioning, land acquisition, site preparation, contractor overhead and profit, and sales tax at 5%.

Source: National Renewable Energy Laboratory, U. S. Department of Energy http://arpa-e.energy.gov/LinkClick.aspx?fileticket=2WF9d-ukumA%3D&tabid=408

NREL also assessed the labor effort that would be needed for a 317,000 kW (peak DC) project.  Hours of effort for electrical work amount to 1,784,483, or almost 900 person-years, and for hardware hours, 544,735, or 272 person-years.  Each person-year corresponds to a new construction job for one year.  Additionally, considering all contributors to construction such as itemized in the legend to the graphic above, NREL estimates that the overall installed cost would be US$4.40 per watt at peak capacity, DC (before conversion to AC for delivery to the grid; this is not a levelized cost for energy).  The NREL presentation offers several cost factors that can be further optimized to achieve cost reductions from this level.

Solar Thermal Electricity.  An alternative way of capturing the energy of the sun is by solar thermal power plants, or concentrated solar power.  Although there are several variants of this method, its central feature is use of large arrays of mirrors to focus sunlight onto fixture containing  a circulating receiving fluid.  The fluid may be a high-boiling oil, or a pure melted salt.  It is heated to very high temperature by the focused sunlight.  The heated fluid is passed through a heat exchanger that converts water to steam for use in driving a conventional turbine to generate electricity.  Since the turbine produces AC power, no inverter is needed.  In addition, the heated receiving fluid can be stored for generating power at night.

An example of a solar thermal installation currently marketed includes several modular heliostat mirror arrays focused on a tower with heated fluid.  Each modular array has a capacity of 33 MW, and one installation can attain as high as 500 MW using many modules. 

The Mojave Desert region of California has had pilot solar thermal plants since the 1980s; many have been successful and have since been decommissioned.  Two solar thermal facilities currently being installed are discussed here.  The Blythe Solar Power Project, operated by a subsidiary of Solar Trust of America,  has four separate plants whose total generating capacity will be just under 1,000 MW, and whose rated energy will be 2,200,000 MW-h per year.  It will be the largest solar thermal plant in the world when completed.  Instead of a tower, it uses parabolic trough mirrors to focus light on pipes containing the circulating heat exchange fluid.  Its final cost is estimated at US$5-6 billion, and it will be located on over 7,000 acres (10.9 sq. mi; 28.4 sq. km) of federal land.  It has an agreement with Southern California Edison which will purchase the generated electricity.  The first of the four plants is scheduled for completion in the 4^th quarter, 2013.

Its economic and environmental benefits include, for the four plants:

• Over 1,100 jobs during approximately a 3-year construction period;

• More than 220 permanent operations and maintenance jobs during its 30-year rated plant life;

• Annual economic impact of more than $135 million during construction period;

• Estimated annual economic benefit of more than $28 million during operation;

• Approximately 884,000 tons of CO2 emissions avoided  per year;

• Approximately 680 tons of NOx emissions per year avoided; and

• Approximately 585 tons of SOx emissions per year avoided

The second solar thermal plant is the Ivanpah solar tower facility, intended to have a capacity of 370 MW.  Seven other solar thermal were also under consideration during 2010 by California’s Energy Commission.  If all nine projects are approved, they would add 4,300 MW of solar electricity, creating 8,000 construction jobs and 1,000 operational jobs.  All were being considered during 2010 in order to qualify for federal American Recovery and Reinvestment Act (economic stimulus) funding.  The Blythe project is receiving a US$2.1 billion loan guarantee from the U. S. Department of Energy, and the Ivanpah project has a US$1.37 billion loan guarantee.

Levelized Cost of Solar Thermal Electricity.  A Wikipedia entry discussing solar thermal energy, after a long discussion considering factors such as those discussed earlier, arrives at a levelized cost of about US$0.10 per kWh.

A 675 MW tandem solar thermal facility under development west of Cuddleback Dry Lake, in the Mojave Desert (posted 11/05/2007), is to be run by Solar MW Energy, Inc. and affiliate Ecosystem Solar Electric Corp.  One plant will operate directly during daylight, and the second plant using stored molten salt heated during the day will operate at night.  A waste heat recovery system permits combined cycle operation throughout the 24 hour daily cycle.  The post states that as a result of these efficiencies, the levelized cost of electricity will be half that of other solar farms, noting an envisioned cost of US$0.06 per kWh.  The power is expected to be sufficient for over a half million homes and businesses.

Conclusions.  The earlier post on economic costs of extreme weather events discussed three anecdotal examples of consequences of extreme weather events which are, or may be considered to be, due at least partly to global warming.  Global warming is a change in climate which is determined over years and over the entire planet.  Nevertheless, single extreme events are considered consistent with the predictions of models for global warming that lead to the phenomena experienced in these anecdotal examples.  The examples chosen show that each in its own way brought enormous economic costs, humanitarian distress and long-lasting environmental effects, and that at least a part of those costs can be ascribed to global warming. 

In this post we have tried to show, again by anecdotal example, that planned expenditures (or rather investments) have total costs that are in the same range as damages created by various anecdotal extreme weather events.  These investments can be used to develop renewable energy sources whose effects will be to mitigate the worsening of global warming.  In addition, the examples show that each modality, wind turbine farms, solar PV farms and solar thermal facilities, has levelized costs of electricity estimated to be comparable to those of nuclear energy, for example, and to fossil fuel-derived generation of electricity (see the earlier graphic).  As already noted, the levelized costs for fossil fuel-powered generation do not account for the harms ascribed to CO₂ as a waste product such as the costs of the extreme weather anecdotes described in the earlier post.  If these were included, the levelized cost of electricity for fossil fuels would be higher.  In addition, it is important that renewable energy projects create new jobs in the economy, both during construction and throughout the operating lifetime of the project.

The earlier post on economic costs of extreme events and the present post consider the relative costs of dealing with catastrophic disasters arising from extreme weather events on an unpredictable, emergency basis on the one hand, and making rational long-term plans for mitigating global warming by investing in new renewable energy sources on the other.  The latter course is the better  one to follow, for it confers significant economic and societal benefits that are absent in emergency responses to catastrophic climate-induced disasters.

© 2011 Henry Auer

Carbon Dioxide – The Waste Product of Our Energy Economy

Summary.  Human activity generates waste.  As the earth’s population grows, and as the world-wide standard of living rises, we create more and more waste.  Examples include household trash, electronic devices, and acid rain.  Most significantly, as we burn more and more fossil fuels to produce the energy that powers modern life, we emit more and more carbon dioxide into the atmosphere.  This substance, an important greenhouse gas, is being released as the waste product of our energy economy. 

As with other forms of waste, significant costs are implicit in reversing any harmful effects that the waste may have on our environment.  It is imperative to treat manmade carbon dioxide as a cost-bearing waste product because of the harmful effects of the global warming that it produces.  These harms carry enormous costs with them.  Accounting for these costs makes it more acceptable to make the investments, and bring about the changes needed, to reduce greenhouse gas emissions.

Introduction.  Humans have always generated waste as part of their life activities.  In prehistory and in historical times it has been a simple matter for mankind to discard its waste, typically in a refuse area, and not to be concerned about its effects, its cost or any need for recovery.  (Archeologists relish these deposits for the clues they contain about ancestral daily life!)  Unfortunately in our day carbon dioxide, an important greenhouse gas, likewise has been regarded as a waste not to be concerned about.

Historical Perspective: Production of Waste  The industrial revolution has brought with it a dramatic increase in the complexity of our daily life.  We use and discard products of manufacture, and burn quantities of energy derived from fossil fuels, that were inconceivable two centuries ago (please see the graphic below). 

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Diagram by Henry E. Auer

Pathway for humanity’s use of resources.  Each stage has costs associated with it.  Here we emphasize the costs incurred at the landfill stage.  The landfill can be a tract of land on earth, or a globalized atmospheric dumping ground for gases.

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Let’s consider some examples of problems attached to waste disposal, and how they have been resolved.

Household waste, including food waste and discarded common items considered to be “disposable”, has increased dramatically in recent decades.  The world’s population has doubled from three billion souls to six and one-half billion currently in about 50 years.  Much of this increase has been in countries with advanced economies that characteristically produce large amounts of waste.  As the population of the world has grown, so has its waste production.  In earlier centuries, disposal of waste was not a serious problem; land available for dumping waste far exceeded the need.  But this is no longer true.  While we in urban and suburban settings think little of waste disposal, there is in fact a cost associated with it.  Cities and towns typically provide waste disposal service as part of their operations.   New York City, for example, has run out of its own municipal landfills for solid waste.  It exports its refuse to other regions of the U. S. at a cost that was budgeted at $296 million for 2008.  This example shows that costs for dealing with waste must be clearly accounted for.

In recent decades in the U. S. many municipalities have implemented recycling programs directed at waste materials that can have a secondary use, such as aluminum and other metals, paper and various plastic materials. Many of these were originally used in packaging.  Costs associated with recycling may be considered to compensate for the original costs involved in preparing the packaging or other item for its first use.  Here again, local governments have recognized costs associated with wastes generated from human activities, and have accepted spending the money involved.  In 2008, New York City required $24 million for recycling activities, after accounting for revenue from the sale of recycled paper.  The total weight recycled was 611,000 tons.

Electronic products, including viewing personal computers, monitors, printers, and cell phones, have proliferated greatly in recent decades.  The components in these devices are frequently wired together with lead solder, the lead being a toxic heavy metal, and may contain other toxic metals such as mercury, cadmium and beryllium.  Regular and compact fluorescent bulbs contain mercury. In order to prevent these metals from leaching into our soils and water supplies, they should be collected and the toxic substances harvested from them.  In general, the costs involved in dealing with electronic waste are not built into the sales price of the item.  Thus the cycle for dealing with these substances is incomplete (see the preceding graphic); we mine and produce the toxic metals for manufacture of the final product, but do not complete the cycle for handling the toxic substances.   Only recently are recycling programs for electronic products and light bulbs being set up, and these are mostly entirely voluntary.  Society has not adequately recognized the costs involved when marketing and selling the products.

The problem of acid rain came to be recognized in the 1980’s.  The phenomenon refers in part to killing of fresh water fish, and of extensive areas of forest, by acidic components in the atmosphere.  The acidic components were identified as being produced primarily by coal-burning power generating plants upwind of the affected areas.  The coal is contaminated by sulfur, which burns to produce the acidic gas sulfur dioxide.  Burning also produces acidic oxides of nitrogen.  In clouds and raindrops the acidic gases produce sulfurous acid, nitrous acid and nitric acid when combined with water, all of which acidify groundwater when they fall to earth.  The increased acidity kills the waterways and forests, usually many hundreds of miles downwind, and frequently in a different state.  This led at first to the denial by the power companies to accept responsibility for the acid rain phenomenon.

Here again the cost of a waste, the acidic oxides of sulfur and nitrogen, originally was not built into the costs of providing electricity to the utilities’ customers.  By 1990 the Clean Air Act was amended to control these emissions, using a cap and trade market mechanism. The technology involves installing waste gas scrubbers that chemically remove the acidic gases.  By the last decade the program has been considered to be largely successful, reducing the acidic emissions considerably, at a cost estimated between $1-2 billion per year.  As recently as April 14, 2011, an agreement was reached between the Tennessee Valley Authority, which operates coal-fired electricity plants, and the Environmental Protection Agency, four states and environmental groups to close 18 such plants and modernize three dozen others with the objective of reducing acid rain. 

Carbon dioxide (CO₂) is the direct product obtained when any fossil fuel is burned in air to provide energy.  Mankind has treated CO₂ as a neglectable product in this process.  Yet CO₂ is the principal greenhouse gas released into the atmosphere by human activity.  Its amounts are unfathomably large, and have grown dramatically since beginning of the industrial revolution hand-in-hand as the production of coal, oil and natural gas have increased.  Fossil fuel extraction and CO₂ production have grown at exponential rates because a) populations that demand the amenities of modern life are growing, b) more and more people around the world are moving from agrarian life to urbanized life styles, and c) urbanized life depends on homes, appliances and modes of transportation all of which consume larger amounts of energy.

Humanity is dumping more and more CO₂, a greenhouse gas, into the “landfill” that is the earth’s atmosphere (see the preceding graphic) with each passing year.  Just as in the examples above, this CO₂ brings with it a cost associated with the effects of its waste dumping.  Increasing atmospheric concentrations of CO₂ produce worsening global warming, whose environmental impacts bring massive costs associated with alleviating their impacts.  These include aridity and drought in some regions with their associated decreases in crop yields and increased incidence and severity of forest fires; increased rainfall and flooding in other regions with their associated crop losses, property losses and human displacements; and rising sea levels, among others.  The costs of these harms are not built in to the economies of extraction and consumption of the fuels.  Just as in the other cases in the examples presented here, our CO₂ economy must incorporate costs associated with, and institute measures directed toward, reducing the emission of CO₂ as well as other manmade greenhouse gases.  We need to embark on these measures in order to limit global warming and its detrimental effects on humanity. 

Conclusion.  Just as in the cases of other commodities produced and consumed by humans, we must recognize and account for the CO₂ waste product of our energy economy.  Simply dumping this waste into the earth’s atmosphere that is our CO₂ “landfill” is harmful to life on earth, because of its effect of worsening global warming.  Recognizing the costs implicit in this waste production justifies the economic and technological investments needed to minimize CO₂ emissions. 

© 2011 Henry Auer