Tuesday, May 19, 2015

33. How to END Global Fossil Fuels Subsidies

A headline from May 18th from The Guardian really caught my eye.

Fossil Fuels Subsidised by $10 million a minute, IMF says (note the British spelling of subsidize)

In summary, the International Monetary Fund (IMF) has completed a study of global fossil fuel subsidies. They calculated a whopping $5.3 trillion worth of annual subsidies for fossil fuels. I have not yet had a chance to thoroughly read the study, and doubt that I will find time in the near future. 

These subsidy calculations include implicit impacts from both local air pollution (see: Beijing, China) as well as impacts purported to be the result of increased heat being trapped in the atmosphere due to the increase in the concentration of atmospheric CO2 that has been observed following the ever-increasing combustion if fossil fuels, with the combustion products (mostly CO2) being dumped more or less directly to the atmosphere. Most people shorten this to climate change, formerly known most often as anthropogenic global warming (AGW).

Note that this post is not meant to argue whether global warming or anthropogenic climate change exists, it is simply to lay out a simplistic plan that would eliminate, over a matter of roughly 2 to 3 decades, a great deal of the subsidies enjoyed presently by fossil fuels (which mostly freely release combustion products to the atmosphere).

The simple proposal (other than politically simple)
Most proposed carbon taxes I have seen over the years have suggested a tax of at least $25 dollars per ton. The article I linked above mentioned a projected cost of 42 pounds per tonne (roughly the same as a ton) of carbon dioxide emissions.
Aside: I should maybe be ashamed to admit that I never have bothered to research the rigor of whether these often-thrown out number are per ton of Carbon in the CO2 released or per ton of CO2, with the oxygen molecules included on the calculation. This is basically irrelevant for the discussion of my proposal here, other than being about a factor of about 3.66 off (3.66 = 44/12 : rough CO2 molecule atomic weight versus carbon atom atomic weight). End aside

Whichever method is typically used in the calculations for computing a carbon/CO2 tax, my proposal will involve instituting such a "carbon" tax in the U.S., but limiting the tax to only $10 per ton (of carbon or carbon dioxide). This cost is much lower than most carbon taxes that have been proposed (that I can recall). Of the revenues generated by this carbon tax, I propose that in the neighborhood of only $2-3 Billion per year for ONLY 5-10 years be allocated to help advance peaceful nuclear power. This level of spending will leave plenty of money leftover for other worthy causes, which I will leave for others to fight over. Despite this "relatively" modest amount dedicated to advancing peaceful nuclear energy, the amount would be enough to kickstart nuclear energy. Properly deployed funding within the U.S. would put the world on a course that can legitimately end the need for any future fossil fuel subsidies. This will eventually result in a reduction reduction global CO2 emissions and allow an increasing of the standard of living of people all across the globe.

For this reduction of CO2 emissions and increase of worldwide standard of living to occur, I would prefer to see the United States regain a top position in supplying nuclear power plants for export. The U.S.-produced designs must be capable of competing with Russian, South Korean, and Chinese plant designs, as those three nations are presently far-and-away leading the world in exporting ready-to-build nuclear power plants. I am afraid that without some fairly rapid policy shifts within the next 5 years, the U.S. will have fallen fully behind the 3 nations listed above, possibly with no hope of recovering.

2 Primary Uses of the Funds

1. Regulatory Funding Reform (combined with a shift toward Enabling rather than Disabling)

Of the $2-3 Billion annually to be allocated to advancing to U.S. peaceful nuclear power endeavors, $200 Million should go towards providing additional funding to the Nuclear Regulatory Commission (NRC), above and beyond the present $1 Billion budget, all but about 10% of which is provided directly from license-holder fees. The primary use of these new funds (greater than 60%) should be to fund hiring of new employees and training staff to support licensing of advanced reactor design and fuel cycle facility license applications.

In conjunction with this new increase of funding, the overall direction of the NRC should be ever so-slightly re-calibrated, more towards enabling than disabling, with NO CHANGE to its reason for being:  "The NRC was created as an independent agency by Congress in 1974 to ensure the safe use of radioactive materials for beneficial civilian purposes while protecting people and the environment."

2. D.O.E. Nuclear Innovation Fund

The funds wouldn't necessarily have to all go through the D.O.E., but more funding needs to be provided to some innovative nuclear power startups than the $452 Million over 6 years that the SMR program was allocating. While those funds should be useful, they are going to light water reactor designs, which are well-proven and probably a little less worthy of subsidizing than some advanced designs that could really advance the overall nuclear fuel cycle. These designs and concepts would not be limited only to reactor designs, but also to advanced fuel cycle facilities. 

Why Will It Work

Simple: Because E = mc^2  (E being energy, m being mass and c being the speed of light........and the speed of light is FAST, really really fast, and SQUARED; thus a tiny change in mass equates to a massive amount of energy)

If you don't understand why I provide such a short answer, PLEASE go read more about nuclear energy and energy density. Basically, nuclear power is a far superior energy source to any other alternative that has been commercially developed so far in terms of the combination of energy density, controllability, and overall environmental impacts.

Limiting the funding to no more than 10 years would make it slightly more palatable politically, although this proposal would be sure to have numerous vehement opponents who would stand to lose out in a true nuclear renaissance. The combination of several years of sustained funding, combined with slight regulatory recalibration would be sufficient to overcome the "coefficient of static friction" that is presently hindering the deployment of peaceful nuclear energy within and from the U.S. and enter a period facing only "rolling resistance" (kinetic friction). Kinetic friction is generally much less than static friction, so once nuclear power enters more of a kinetic friction regime, other sources of energy will be unable to beat it out in any properly-designed, fair market. The qualities that make nuclear energy a superior source of energy will cause it to win out in the markets it is suited for. I would expect that in this hypothetical future, that fossil fuel subsidies could be all but fully eliminated from the world within 25-30 years of the start of my proposed program.