Saturday, January 24, 2009

How Sustained Economic Progress Underscores Energy Innovation

We currently live in a world where prosperity/sophistication/affluence and poverty/destitution/inadequacy surprisingly co-exist. This isn’t an unusual state that our world is in, but what’s unusual is the staggering number of people that are in the former state, i.e. impoverished!

Dipal Barua, Managing Director of Grameen Shakti (and Deputy MD of Grameen Bank, i.e. right hand man to Muhammed Yunus, The Nobel Prize laureate) was awarded the Zayed Future Energy Prize ($1.5 million) for his pioneering work in facilitating the provision of solar powered lanterns to millions of homes that do not have access to electricity in Bangladesh, and empowering indigenous entrepreneurs to help service these same devices in these communities. This helped to radically cut-back the hazardous and hardly effective use of low intensity naked flames as light sources. Kids can now do their home-works at night; entrepreneurs can now work better after sunset and many other possibilities have become a reality.

World leaders have since realized the potential catastrophe that could result if the current state we are all in persists. Many of us would be surprised to learn that much more than a billion people have never experienced the joy of electricity, or the use of electrically powered devices; let’s not even begin to consider these colleagues of ours having access to the internet, or even making telephone calls.

On this premise, many nations (at least those that care to look, perceive, understand and act) have embarked on a host of empowerment/enlightenment/development programs aimed at mitigating, perhaps overturning these unacceptable conditions existing amongst humans with supposedly equal rights (at least that’s what we have inscribed on documents such as our Sovereign Constitutions, or the UNs “Universal Human Rights Declaration”)

A host of economic development and rural empowerment programs have been enacted by Development Strategists in National and Multilateral Development agencies and not-for-profits all around the globe and these are being implemented and monitored by experienced executionists. One of the core challenges we however face in our time, has been the unprecedented surge in human population. This essentially translates into much less accessibility to and availability of fixed resources per head. (Examples of relatively fixed resources are Water, Land, Air, and Subsurface Resources including metals and fossil fuels and some more). Hence, we are left with no option but to find ‘better’, i.e. ‘more efficient’ and ‘conservative’ ways of utilizing these limited resources fairly.

We humans are great learners, and have an extraordinary ability to adapt to changes that we recognize (or more accurately, changes that we choose to recognize). Take a peek at a city like London. The average apartment is so small (relatively), that a middle-class first time visitor (or immigrant) from Nigeria would begin to wonder whether the houses were built for high school students. But the reality is London has had to adapt to the surge in population, and by implication, such huge demand (and fixed supply) for real estate because of her esteemed status of “Leading Global Commercial Nerve Center”.

My focus here is on energy, and I want to point out that significant and sustained economic advancement would remain an elusive dream if we do not ensure that energy is reliably available, and not at a high cost to help power entrepreneurial and development activity. (‘High cost’ refers to whatever we have to pay for it, be it in strict economic terms, or in less definite terms such as the destruction of our ecological and environmental systems).

I’ll be swift to point out that renewable/alternative energy technologies are not designed to replace fossil fuels and other traditional sources we’ve been familiar with. Rather, the purpose of exploring and developing these technologies is to complement and expand /diversify our energy base. The pace of anticipated economic development that is required to bring out millions (perhaps billions) out of extreme poverty would create enormous increase in energy demand that legacy sources would certainly not be able to cope with.

Furthermore, even if additional reserves of legacy energy sources (such as coal, gas, crude-oil, bitumen and some more) are discovered in large enough quantities, and are exploited to keep up with rising demand, then we may end up sacrificing the critical life support systems of our planet altogether in the name of ‘economic growth’. Already, scientific data has provided more than enough evidence to support the proposition that human activities have exacerbated CO2 (and other GHG) concentrations in our atmosphere, resulting in a climate imbalance that threatens both aquatic and terrestrial life.

CCS (Carbon Capture and Storage) technology, Geo-Thermal energy, CO2 reinjection into petroleum reserves for EOR (Enhanced Oil Recovery), The CDM’s (Clean Development Mechanism) Emissions Trading (of Carbon credits using “Cap & Trade” to help orchestrate flow of funds from the culprits, i.e. industrialized economies, to developing economies and in the process cutting back net-global emissions), and the new-improved Nuclear Technology, have all proven to hold significant promise for clean energy. Japan for instance, derives about 30% of its energy needs from nuclear technology. Though Nuclear technology has been quite controversial (particularly with respect to dilemma of dealing with nuclear waste), we have to understand that just about only 10% of global nuclear waste is a product of the civilian applications of nuclear technology, and the technology has been greatly improved. (Please do not ask where the other 90% of nuclear-wastes came from). Also, Iceland has exploited geo-thermal energy to take care of more than half of her energy needs.

The readily and abundantly available energy of the Sun and Wind provide massive opportunities for even larger scale implementation than earlier mentioned sources. CSP (Concentrated Solar Panel) technology is being utilized for the MASDAR project ( in Abu Dhabi, UAE. CSP is about seven times more efficient than traditional solar panels, and holds great promise for harnessing solar energy.

The path we face now is that of entire cities being powered by solar, wind and other forms of abundant, long-lasting renewable energy sources. Admittedly, many of these projects require enormous financial and human start-up capital (tell me which project doesn’t require that!), but once they are up, marginal costs of keeping them operational decline steeply. Worthy of note is that many rural areas, especially in the developing world currently do not even have the luxury of a nearby grid. Grid expansion projects require enormous capital, and are usually the exclusive domain of national governments. However, renewable energy technologies (such as solar and wind) do not have to be fed into a grid.

Independent projects could (and ought to) be implemented and replicated in several remote communities, implying partial elimination of grid expansion/distribution costs over large areas.

Efficiency is an absolutely important aspect of energy production, transmission and usage. A research conducted in a region of the United States showed that the average grid was about thirty years of age. This sounds more like a case of powering today’s economy with yesterday’s energy solutions. A lot of energy is actually wasted during transmission on in-efficient grids. (I wonder how much energy we lose on our poorly maintained grids in Nigeria, and Africa). Investing in grid-efficiency, and efficient usage of other energy sources have been proven to hold the potential for achieving 25% of the emission reduction targets that have been set for 2050 (i.e. returning global emissions to 1990 levels). We now have to think deeply when making choices about which cars to purchase (but this has little to do with my desire to purchase a BMW when the money comes – BMW has a technology that converts the heat energy generated when you apply your brakes to electricity, which is then harnessed for other uses in your car plus a low-resistance rolling technology that allows your wheels to roll with so much ease, reducing the energy needed to overcome gravity and friction. BMW ought to pay me for this!)

We need to be innovative. We need our economies to continue developing rapidly. We need energy, and more energy. We also need to take care of our planet (except someone has found another one). We need as many as possible to have fair access to 21st century technologies and resources, powered by reliable and renewable energy sources. Who knows whether the next Nigerian Nobel laureate is playing around in some remote village, waiting to be a given a well deserved opportunity for self-expression?

“Outliers” – A book written by Malcolm Gladwell brilliantly ties success (what many call genius) to opportunities (Time and Chance). Take nothing away from successful people; they worked hard and were rewarded, but they were presented with opportunities at dead accurate times that many did not have. Indeed, to whom much has been given, much is expected. If we want ‘much’ to come out of our societies, then we must present ‘much’ to our citizens. I’m excited NNPC has partnered with Masdar (The Future Energy Company, whose parent is the famous Mubadala) in aligning Nigeria with the Clean Energy movement. Great things lie ahead.

Renewable energy provides great opportunities that must be embraced now, and I dare say is the FUTURE of ENERGY. Well done MASDAR!