Clean Investment Boom on the Horizon

January 1, 2013 in Building the Green Economy, Climate Destabilization, Mapping the Open Future, Quipu Economic Forum, Renewable Resources, Zero-combustion paradigm by Joseph Robertson

We are not in the business of forecasting investment trends, here at the HotSpring Network, but we are in the business of hunting the paradigm shift, and the coming economic paradigm shift is all about energy. Fossil fuels have outlived their usefulness, in that they are now causing far too costly external impacts to human civilization and the world economy, given the alternatives we have available. Clean energy technology will capture the next major investment boom, and that boom could last longer than the oil boom of the last 150 years.

In the year 2200, if they are still around at all, institutions like Goldman Sachs will be the most skilled investment engines centering their activities on clean energy technologies and clean energy “reserves”, not as they are now: the world leaders in petroleum investment holdings. Petroleum will be an expensive commodity harvested primarily for refinement activities such as the creation of high-grade medical polymers and other plastics; recycling will diminish the need for new extraction.

The clean energy boom will be economically sustainable, because it will be environmentally sustainable. The logic of clean energy pulls the overall economy ever further along the road to full-spectrum sustainability, and electronics allow us to activate more and more robust efficiency gains. Quantum computing and manufacture will also allow us to achieve efficiency gains far beyond what we now find to be routine about physical electronics output.

But we don’t need to wait until 2200, or 2100 for that matter. As of 2009—according to research conducted by Mark Jacobson, of Stanford, and Mark Delucci, of UC Davis—then state-of-the-art technology for wind, solar and hydro power production could cover many times our total energy demand. Ramping up to 100% clean energy production, given questions of affordability and the need for new infrastructure, would take roughly 20 years, by their estimation.

The truth is: as of Jan. 2013, after back-to-back years of record growth in wind and solar power production in the United States, and faced with the massive cost burden of upgrading fossil fuel infrastructure for already planned petroleum and natural gas production and distribution, we have an opportunity to achieve at least 80% clean renewable energy production, without added costs, over and above what is already planned, by 2020.

All we need to do is transfer investment planning from outmoded, inefficient, high-seepage, fossil fuel infrastructure to self-funding, cost-effective, efficiency-accelerating clean energy infrastructure, planning as we go for the seamless introduction of new technologies. There are four crucial energy sectors we need to retool, and we can immediately ramp up retooling on all four, without further delay: electricity, transport, industrial production and military.

The Pentagon has already established policy finding that localized spontaneous clean-energy production capability is a measurable asset, in tactical and fiscal terms, in both combat and non-combat zones. The USS Makin Island—the first true hybrid-drive combat-ready warship—is already at sea, and advanced research into 100% clean renewable energy options, beyond the capabilities of 100% solar-powered drone aircraft, is underway and gathering momentum.

By the year 2016, we expect to see on the consumer market advanced solar photo-voltaic technologies, such as “spray-on solar” or “solar paint”, and fabrics comprised at least in part of “solar glitter”, solar threads and “printable solar” inks. These advances will make solar power the most efficient and user-friendly way for consumers to power mobile devices. Even children’s toys may finally move beyond the “Batteries Not Included” warning so many parents dread.

Applying the kind of relentless determination to innovate that allowed Steve Jobs and Apple to re-establish the rules for industrial design efficiency and compact-form user empowerment, embodied in the iPhone, Richard Branson, of Virgin, is heading a consortium of aero-space investors aiming to create zero-emissions jet fuel within 10 years. The work of Solar Impulse, based in Switzerland, has already shown the promise of a future in which airplanes will not require combustible fuel at all.

Solar Roadways, in Montana, and the Israeli-American venture Better Place, together illustrate the immense potential for a rapid and seamless retooling of our transportation infrastructure, that will allow not only for “instant recharge”—via battery switch-out—of electric vehicles, but also for an immense distributed energy production plant, across the continental United States, capable of replacing nearly 100% of our national electricity supply.

Now, the why: Clean renewable energy technologies will be the next long-running world-altering capital investment boom economy, because 1) they afford solutions to several major global problems confronting humanity, 2) they afford more efficient investment-to-output return, regarding energy production, and 3) they will establish a new paradigm that will likely never be displaced by anything but a more efficient variation of clean renewables.

This last point is the most important for policy-makers, energy producers and investors to understand right now. The primitive-feudal model of tax-for-passage energy use—we own a finite resource, you pay us for access to it—will be replaced by a new, more open, more democratic mode of production—we give you technology, you use it as efficiently as possible, collaborate in overall production, and new technologies will allow you, the consumer to continue to make efficiency gains at regular increments.

When that transformational tipping point happens, and we enter the clean renewable distributed energy market paradigm, the logic of energy economics will change, drastically, and the balance of power will shift to the consumer side in unprecedented ways. Technological innovation will rapidly replace land and lease-ownership, or futures speculation, as the leading indicator of market power and leadership. Apple Computer surpassing Exxon-Mobil in total market value is the first indicator that this transition is irreversibly underway.

Information, electrons, efficiency and innovation, now demand that leading market drivers (companies, regions or nations) be prepared to function in the innovation-centric sustainable economy. No longer is it feasible to use 17th- and 18th-century combustible fuel technologies, with relatively minor improvements over time, to power the 21st century economy. The age of clean renewable power is setting down roots, and we all need to understand the lay of the land.

There are ways to motivate this massive flow of new investment capital into clean, renewable energy technologies. The simplest is to offer a coordinated, reliable price signal to major institutional investors, by putting a price on the introduction of carbon-dioxide-emitting fuels into our economy, returning revenues to households—so this simple solution spans the entire marketplace—and steadily escalating that carbon fee, and the household reimbursement, so the market can better see the cost-efficacy of clean renewables.

The fossil fuel divestment movement is gaining traction, with activity on more than 200 campuses across the United States, and some municipalities, including the city of Seattle, declaring their plans to reorganize public finances to comprehensively divest from fossil fuels. This is another market-driven motivator of an accelerated transition, and another reason the United States economy will benefit from a revenue-neutral carbon correction fee and household reimbursement plan that makes clean renewables cheaper and more prevalent sooner rather than later.