"This country only gets excited about energy when oil prices get high," Dan Arvizu, director of the National Renewable Energy Laboratory, said during a presentation at the Clean-Tech Investor Summit taking place here. "We do have a problem with how serious we are about our energy challenges."
Arvizu, who advises the White House on energy policy, underscored the point by displaying pie charts detailing U.S. and global energy consumption at the present and projected for 2030.
In 2004, oil accounted for 40 percent of the U.S. energy budget, while coal took up 26 percent. Natural gas accounted for 21 percent; nuclear power, 6 percent; and renewable energy, 7 percent.
Flash forward to 2030. The figures are almost identical, with oil sticking at 40 percent and renewable actually dropping to 6 percent.
The worldwide figures aren't much better. Renewable energy accounted for 14 percent in 2002 and is projected to be at 14 percent again in 2030. While the renewable figure is higher worldwide, that's only because many people in emerging nations rely on dung and wood fires, which account for a disproportionate amount of those renewable energy sources.
The problem is twofold. One, energy demand continues to increase. Overall, the world now uses about 13.5 terawatts of energy a year: the figure includes oil, electrical power and other sources of energy. That figure will rise to 20 terawatts per year by 2050.
Thus, the demand for energy is outstripping the ability of solar, wind and other purveyors of alternative energy to displace traditional fossil fuels.
Second, installing an alternative-energy infrastructure isn't cheap, despite the influx of venture money into the field and the strong demand for technologies such as solar. If oil drops below $55 a barrel, most biofuel concepts will be unprofitable, Arvizu projected. Even if oil doesn't drop that low, it will cost a lot to get an ethanol-solar-wind society off the ground.
To meet the Department of Energy's goal of making ethanol 30 percent of the U.S. transportation fuel budget, fuel manufacturers will have to invest $100 billion in refineries. To make wind power 20 percent of the source of the electricity in the U.S., it will take $500 billion in infrastructure investments.
After depressing the crowd, however, Arvizu did sound some optimistic notes. The National Renewable Energy Laboratory and other national labs are working to transfer technologies out of the labs to private-sector companies. Alternative energy is popular with the population at large and many politicians. In a discussion with investors and reporters after his speech, he even said that President Bush is the greenest member of the Cabinet.
What's more, current energy infrastructure isn't that efficient. Sixty-two percent of the energy consumed in America today is lost through transmission and general inefficiency. In other words, it doesn't go toward running your car or keeping your lights on.
"Sixty-two percent is an untenable amount of waste," he said. "Energy efficiency should be our No. 1 priority."
Other scientists, such as Stephen Chu, director of Lawrence Berkeley National Laboratory, have said that conservation can provide gains in energy efficiency.
