The green paradox: wealth, power, and crisis

From the collective standpoint of the global rich and powerful the manifest imperative is to increase wealth and power and to respond to all threats to the global imperium of wealth. This means that there’s little willingness to take collective emergency measures to respond to the ever worsening prospects for global ecological collapse before increasing global levels of carbon dioxide, methane, and other greenhouse gasses unleashing catastrophic consequences.

The essential problem is not technical. Solar, wind and efficiency technology make the potential for reducing greenhouse gasses possible. The issue is not a question of how to respond to the deepening global ecological crisis, but when an effective global response will happen.

Currently, renewable development is rapidly increasing along with increasing global emissions. There’s a silent global consensus to support renewable development, and at the same time refuse to require even an annual 1 percent reduction in greenhouse gas emissions. Fossil fuel companies continue to pour emissions freely into the atmosphere as profits continue to soar. The numbers are stunning. From 14.9 gigatons (billion tons)of carbon dioxide emissions in 1970 to 25.5 gigatons in 2000 to 37.5 gigatons in 2023 and still rising. Concentrations of carbon dioxide were 325.06 parts per million (ppm) in January 1970 , 370.76 ppm in January 2000, 425.5 ppm in July 2024.

Without the pursuit of both ecological and social justice on a global scale, it’s simply increasingly likely that we will face ecological consequences of climate change from carbon dioxide pollution ranging from dire to catastrophic.

The real issue on the table is not an end to capitalism, or making economic growth to supplanted by “degrowth”, but how to make our economic system support profit/surpluses that pursues ecological economic growth (EEG) in a system that makes sustainable actions less expensive, more profitable and increases market share, slaying the beast of self-destructive externalities.

We will explore ways to make all or most renewable energy users have an equity stake in our renewable future and a seat at the table to make the key decisions to accelerate renewable development while mandating year by year reductions in fossil fuel pollution.

There’s a continuity in the current world system largely shared by both polluters and green developers. That is the concentration of wealth and power in an oligopoly of the control of wealth. Investment of trillions of dollars in green energy need not mean that trillions of dollars will not still be invested in profitable devastation of the ecosphere.

The market system is aggressively pursuing global renewables. But at the same time it’s also bankrolling and financing fossil fuel development. As a solar developer, I worked on a solar project on farm land that had an existing 2 megawatt scale installation owned by Goldman Sachs who had leased a portion of the farmland. They were willing to allow my smaller project to be built (210kw about 500 solar panels) to the south of their array as long as I could demonstrate I would not shade their system.The attitude by the Goldman boys was that they are working on saving the planet and building equity. Billionaires becoming trillionaires.

BlackRock, for example, is the world’s largest asset holder managing $10.5 trillion in assets in 2024. Blackrock is committed to developing and managing trillions of dollars more of green development. According to BlackRock, in the next 30 years there will be a shift of global energy sources from two thirds fossil to two thirds renewables. This represents a $9 trillion investment opportunity.

Climate infrastructure already represents one-third of global infrastructure deal flow. In rich nations there is a movement toward electrification to replace fossil fuel combustion, and in emerging markets of the aspiring poor there is a similar demand for increased renewable power generation. Concludes BlackRock “substantial investment is required across other parts of the climate infrastructure value chain including energy storage, energy distribution and electrified transport”.

For example, BlackRock and their transnational development partners are happy to finance wind and solar large scale micro-grids to replace in part or whole existing utility fossil fuel generated power. They offer a good deal.They will build and own and operate the solar, wind and storage system and sell energy at prices below existing fossil fuel rates as part of long term agreement. There are zero fuel costs to run the renewable and storage system.

The existing high prices for fossil fuels and for utility distribution and transmission means that , particularly in areas with high utility rates, BlackRock costs to build, operate and maintain and profit from the renewable plus storage system are substantially below existing costs and are quite profitable.

The good news is that big capital wants to build, bankroll, and own the renewable energy future. The bad news is two fold. First, there is little appetite to slash greenhouse gas emissions from fossil fuel use on a desperately needed emergency basis. The oil majors and fossil fuel producing nations are determined to continue producing oil, coal and natural gas as long as they have reserves and can profit. Renewables will be built on increasing scale, but fossil fuel production will decline as slowly as possible if at all. Carbon capture and storage as the latest clearly uneconomic smoke screen to help keep the fossil profits rolling. $Billions of subsidies for oil, coal and natural gas will continue to flow keeping prices “affordable”. The International Monetary Fund (IMF) finds that there are $7 trillion in yearly subsidies for fossil fuels to keep prices lower for both business and consumers. We are subsidizing our self-destruction.

The dance of the mega polluters

The United States and China are the world’s largest economies and largest greenhouse gas emitters and polluters. China is currently the largest emitter. The United States is now second. The U.S. is by far historically the largest emitter. China in total to date has emitted 284 billion tons of carbon dioxide; the United States 509 billion tons. The U.S. remains the leading emitter per person of 17.6 tons of carbon dioxide equivalents per person per year; China is at 10.1 tons per person. A sustainable level globally is around 2 to 3 tons per person per year. Many of the poorest countries are not industrialized and have minuscule carbon emissions per person. The average is 2.6 tons in South and Southeast Asia and 1.6 tons per person per year in Sub-Saharan Africa.

Carbon dioxide pollution is driven by the richest countries and is by far the responsibility of the richest members of the population. Emissions of the richest 1% since 1990 are increasing the fastest. In contrast, the poorest half of the global population have per capita emissions increasing from 1.2 tons per person to 1.6 tons per person.And the poorest billion people emit less than one ton per person.

China and the United States have undertaken steps to respond to the deepening climate crisis. The Biden administration has through the Inflation Reduction Act (IRA) support aggressive tax credits for renewable development and great expansion of wind and solar with regulations to limit emissions from fossil fuel plants and internal combustion engines.

The goal is reducing U.S. greenhouse gas emissions 50-52% below 2005 levels in 2030, reaching 100% carbon pollution free electricity by 2035 and a net zero emissions economy by 2050. These goals are admirable if achieved. They certainly would be supported by a future Harris administration and destroyed by Donald Trump, climate denier. But so far the increase in renewable energy and energy efficiency has not led to a reduction in U.S.and global greenhouse gas emissions which continue to increase. There is simply not a real commitment to reduce yearly greenhouse gas emissions, for example, by 1% a year. We have neither reached peak oil production or taken steps to limit emissions.

The United States is now the largest global producer of oil in history, averaging in 2023 12.9 billion barrels of crude a day. In December 2023 the U.S.broke the 13 billion barrel barrier, producing 13.3 billion barrels monthly daily average.This puts even Saudi Arabia to shame. The Saudis have abandoned plans to reach 13 billion barrels a day in 2027.

The oil producers talk about carbon capture and storage to reduce emissions. The truth is that oil is already unable to compete with renewables that offer zero fuel cost and ever decreasing production costs and ever increasing efficiency.

For example, new storage technologies like Form Energy’s iron-air batteries use common materials that will replace lithium batteries at a fraction of the cost for stationary wind and solar. Oxford researchers have developed a new light weight ultra thin film perovskite solar material that can be easily applied to almost any building and generate solar power at an increased 27% conversion efficiency .The material can be mass produced cheaply without the use of existing heavier silicon based solar modules.

China is by far the largest builder of renewable energy, and the largest global producer of solar and wind hardware. China just announced a a series of important energy and climate steps. On August 6, China released “Action Plan for Accelerating the Construction of a New Electricity System (2024-2027)" focused on carbon reduction, climate change and moving toward an ecological civilization. On August 11, the Chinese government released the “Opinions on Accelerating the Comprehensive Green Transformation of Economic and Social Development.” This represents a systematic attempt to accelerate a comprehensive green transformation of economic and social development.

The document declares, “We shall accelerate the building of a new development pattern, unswervingly follow the path of giving priority to ecological protection, being intensive and economical and green and low-carbon for high-quality development… accelerate the modernization of the harmonious coexistence between humanity and nature.” This is a detailed national policy announced by Beijing as a guide for implementation and conduct that will have a broad effect throughout China.

The results will be expressed by speed of slashing emissions particularly by reduction in coal emissions with detailed plans including integrating organic material in firing. The International Energy Agency (IEA) outlook is for China’s fossil fuel demand to peak in 2024 and then decline as rapid drop in coal use offsets increases in oil and gas.

China is also the leader in EV purchases and battery development as well as solar installations and reforestation. Chana has installed a total of 609 gigawatts of solar by 2023 an increase from only 4.2 gigawatts in 2012 and still rapidly expanding in 2024. Total global solar capacity in 2023 according to the IEA was 1,600 gigawatts with China representing 38% of global installations.

Two basic pathways for social and ecological health

First, broad and shared ownership of the $ trillions of renewable resources is crucial in all nations. This will represent yearly investment in the range of 2 to 4 trillion dollars a year from now to 2050. Shared ownership and democratic control is a central concern for both ecological survival and economic democracy.

The renewable energy and efficiency that drives civilization needs to be based on making all energy users energy owners.The economics of solar can easily lead to ownership by energy users. Solar finance is based on having long term agreements with off-takers, that is, energy users.

In the US, for example, when tax equity is exhausted in year six, user purchase and ownership can be easily financed by muni bonds or green bank finance. The price of solar power already includes all costs and profits which can be shared by energy users. For example, on a large scale NY City could own the gigawatts of planned renewables. Public and cooperative power is the path.

This is relevant for all parts of the world. The issue is fair distribution of capital to make things happen writ large following Green Bank and Grameen Bank models applied to renewables.

Second, are new market rules realistically valuing ecological conduct and emission reduction. A central failure of the market system has been the failure to properly deal with so-called externalities, that is, the economic and ecological consequences of pollution, depletion and ecological destruction.

The most straightforward tool is not increasing taxes on fossil fuels, beloved by economists and despised by consumers and politicians, but to monetize the positive results of sustainability and pollution reduction. For example, solar displacing carbon pollution results in ecological and social savings valued by the Nation Academy of Sciences and the EPA of $190 dollars per metric ton of carbon dioxide equivalent emissions with 2.5%. discount rate.

In the US, average kilowatt hour of electric power releases .86 pounds of carbon dioxide per kilowatt hour. Each megawatt solar in the northeast generates about 1.2 million kilowatt hours per year, displacing a bit more than 468 metric tons of carbon dioxide valued at $92,340. NY state plans to complete installation of 6 gigawatt hours of community solar (or 6,000 megawatts) capacity. This has a grredreal value in addition to the power generated a yearly value of $554 million dollars for displacement of fossil fuel pollution. In 30 years this means $16.6 billion in monetized ecological value.

A regulatory asset, Sustainability Credits (SCs), is based on the value of displacing a metric ton of carbon dioxide emissions through renewable energy or increased efficiency. It can be monetized as paid in capital and as cash on the books of banks to be used for investments in further sustainable projects. The solar system’s annual production is carefully measured, and the system is given an identification number to prevent double counting by both regulators and banks.

Displacing the global polluting 37 gigatons of annual carbon dioxide emissions can become the basis quickly for trillions of dollars of wealth to be reinvested in future sustainable activities. 37 gigatons of carbon dioxide emissions eliminated at $190 per metric ton is $70 trillion dollars annually for ongoing carbon dioxide displacement by renewables. The IPCC goal is a 50% reduction in carbon dioxide emissions by 2030. That would mean, conservatively, by 2030, a global potential yearly investment in sustainability of $27.5 trillion.

Conclusion

We face both ecological and social challenges that transcend questions of technological design. Failure to really respond to climate change in time can mean irreversible geophysical changes, great misery and cascading social and economic collapse.

Our positive choices are to follow pathways for ecological and social health. An ecological civilization will arise from pursuit of justice and ecological sanity, and a clear eyed view of the future supported by ecological market rules, law and regulation. Our interest is in the health of the biosphere that is inseparable from the health of humanity and our collective prosperity and freedom.